VT · Tax Year 2026
How Vermont taxes Social Security, pensions, 401(k)/IRA withdrawals, and military retirement pay in 2026.
Up to $10,000 qualifying government retirement exclusion subject to income limits; military fully exempt through AGI $125,000
No general age-based private-retirement exemption
Additional Notes
Social Security fully exempt through AGI $55,000 single/$70,000 joint; government retirement and Social Security exclusions cannot both be claimed
Does Vermont tax Social Security benefits?
It depends. Vermont offers partial exemption for Social Security — eligibility is typically income-based or age-based. See the details above.
Does Vermont tax pension income?
Partially. Vermont provides exemptions for certain types of pension income — often public, government, or military pensions — while private pensions may be partially or fully taxable. See eligibility details above.
Does Vermont tax 401(k) and IRA withdrawals?
Yes, traditional 401(k) and IRA withdrawals are generally taxable in Vermont. However, exclusions or credits may apply depending on your age and income — review the details above.
Is Vermont a tax-friendly state for retirees?
It depends on your income mix. Vermont offers some retirement income relief, but the rules vary by income type and eligibility. Review the details above and consider consulting a tax professional for your specific situation.
Partner Services
Planning your retirement location involves more than state taxes. Compare states, model income scenarios, and get personalized advice from a fiduciary financial planner.
DataTactic may earn a referral fee from partner services. Data on this page is independent and unaffected by partnerships.
Data Source
Official Vermont state tax authority guidance. Tax year 2026. Some annually indexed thresholds may not yet be finalized — confirm with the state revenue department before filing.
Related for Vermont
Neighboring States
Data reflects tax year 2026 rules sourced from official Vermont state tax authorities. This page is for informational purposes only — always confirm current rules with the state revenue department or a qualified tax professional before making financial or relocation decisions.