Does Vermont tax Social Security?
Taxes Social Security for some people
Partly. Vermont exempts Social Security in full at lower incomes and phases the exemption out as income rises. For single filers in 2025, it is full up to $55,000 of adjusted gross income and gone at $65,000.
What the Vermont Department of Taxes says
We do not paraphrase the rule from memory. This is the state's own wording, copied from the page linked below it:
“For all other filing statuses, the Vermont exemption applies in full to an AGI up to $55,000. It then phases out smoothly for filers earning between $55,000-$65,000. It does not apply to filers with AGI greater than or equal to $65,000.”
Details worth knowing
- For married couples filing jointly, the department's page gives two different sets of figures: its text says the exemption is full up to $65,000, while its 2025 table says full up to $70,000. Both say it ends at $80,000. Check the Schedule IN-112 worksheet for your return.
Federal tax is a separate question
Whatever Vermont does, the IRS decides on its own how much of your benefit is taxable on your federal return. Whether it does depends on your other income. Our taxable Social Security calculator follows the IRS worksheet line by line, and this guide explains the rule.
You can ask Social Security to withhold federal tax from each payment. Withholding for Vermont state tax, if you need it, is arranged with the state, not with Social Security. State rules change with new laws, so check with the Vermont Department of Taxes before you file.
Other states where the answer is “taxes Social Security for some people”
Check our work
The answer above comes from this page. Follow the link and compare.
- Social Security ExemptionVermont Department of Taxes. Read on November 12, 2026.