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Vermont uses a four-bracket progressive tax from 3.35% up to 8.75% for 2026. The structure: 3.35% on your first $42,150 of taxable income (single), 6.6% to $102,200, 7.6% to $209,900, and 8.75% above that. That 8.75% top rate is among the highest state income-tax rates in the country — behind only California (13.3%), Hawaii (11%), and New York's combined top (10.9%+NYC). Vermont's standard deduction is $6,500 single / $13,050 married — deliberately lower than the federal deduction.

On $82,000 single: taxable income after the $6,500 deduction is $75,500. The first $42,150 costs 3.35% ($1,412), the remaining $33,350 at 6.6% costs $2,201 — total about $3,613, an effective 4.4% of gross. But note the bracket jump: cross $102,200 of taxable income and the marginal rate leaps from 6.6% to 7.6%. Burlington adds no city income tax.

Vermont fully taxes Social Security for most earners (exempt only for low-income households under roughly $45,000 AGI with phase-out), which makes it one of the least retiree-friendly states in New England. The state does offer a retirement income adjustment for military and some civil-service pensions.

Property tax runs 1.86% average — fifth-highest nationally — and combined sales tax is 6.35%. Vermont's total tax burden consistently ranks among the top five states, which is the trade-off for its school funding model and public services.

Filing in Vermont: the resident return is Form IN-111, filed with the Vermont Department of Taxes by April 15. Vermont offers free e-file, and the state lets you itemize on the state return even if you took the federal standard deduction.