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Understanding Personal Income Tax in Vermont

Filed under State Taxes. Fact checked on June 22, 2012.

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Vermont's personal income tax is discussed.

If you are a resident or nonresident of Vermont and receive taxable income individually from property owned or business transacted in Vermont, you are subject to tax on net income. Therefore, if you are operating your business as an S corporation,partnership, limited liability company, or sole proprietorship, you will be subject to a personal income tax on your business income that passes through to you.

In 2012 the tax will be imposed at rates ranging from 3.55% to 8.95%.

The following marginal tax rates and income brackets apply for 2012:

Single Individuals
Taxable Income Marginal Tax Rate
0 to $35,350 3.55%
Over $35,350 but not over $85,650 $1,255 plus 6.8% of the amount over $35,350
Over $85,650 but not over $178,650 $4,675 plus 7.8% of the amount over $85,650
Over $178,650 but not over $388,350 $11,929 plus 8.8% of the amount over $178,650
$388,350 and over $30,383 plus 8.95% of the amount over $388,350

Married Filing Jointly
Taxable Income Marginal Tax Rate
$0 to $59,050 3.55%
Over $59,050 but not over $142,700 $2,096 plus 6.8% of the amount over $59,050
Over $142,700 but not over $217,450 $7,784 plus 7.8% of the amount over $142,700
Over $217,450 but not over $388,350 $13,615 plus 8.8% of the amount over $217,450
$388,350 and over $28,654 plus 8.95% of the amount over $388,350

Married Filing Separately
Taxable Income Marginal Tax Rate
$0 to $29,525 3.55%
Over $29,525 but not over $71,350 $1,048 plus 6.8% of the amount over $29,525
Over $71,350 but not over $108,725 $3,892 plus 7.8% of the amount over $71,350
Over $108,725 but not over $194,175 $6,087 plus 8.8% of the amount over $108,725
$194,175 and over $14,327 plus 8.95% of the amount over $194,175

Heads of Household
Taxable Income Marginal Tax Rate
$0 to $47,350 3.55%
Over $47,350 but not over $122,300 $1,681 plus 6.8% of the amount over $47,350
Over $122,300 but not over $198,050 $6,778 plus 7.8% of the amount over $122,300
Over $198,500 but not over $388,350 $12,686 plus 8.8% of the amount over $198,050
$388,350 and over $29,432 plus 8.95% of the amount over $388,350

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