Vermont State Income Tax Withholding Information

State Abbreviation:

VT

State Tax Withholding State Code:

50

Acceptable Exemption Form:

W-4VT

Basis for Withholding:

Federal or State Exemptions

Acceptable Exemption Data:

S or M/Number of Exemptions

TSP Deferred:

Yes

Special Coding:

None

Additional Information:

If a State income tax certificate has not been processed or if a valid State exemption code is not present, the Federal exemptions will be used in the computation of State tax. If the Federal exemptions are used and the employee has elected to have additional Federal taxes withheld, then additional State withholdings will be withheld at 27 percent of the additional Federal tax withheld and added to the State tax withholdings.

Additional Resources:

TAXES 15-17, Vermont State Income Tax Withholding

Withholding Formula (Effective Pay Period 06, 2015)

  1. Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Health Benefits Plan payment(s) (includes dental and vision insurance program and Flexible Spending Account - health care and dependent care deductions) from the amount computed in step 1.
  3. Add the taxable biweekly fringe benefits (i.e., taxable life insurance) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages times 26 to obtain the gross annual wages.
  5. Determine the exemption allowance by applying the following guideline and subtract this amount from the annual wages to compute taxable income:

    Exemption Allowance = $4,000 x Number of Exemptions

  6. Apply the taxable income computed in step 5 to the following table to determine the annual Vermont tax withholding:

    Tax Withholding Table

    Single or Head of Household

    If the Amount of
    Taxable Income Is:

    The Amount of Vermont
    Tax Withholding Should Be:

    Over:

    But Not Over:

     

    Of Excess Over:

    $0

    $2,650

     

    $0.00

    plus

    0.00%

    $0

    2,650

    39,750

     

    0.00

    plus

    3.55%

    2,650

    39,750

    93,050

     

    1,317.05

    plus

    6.80%

    39,750

    93,050

    191,600

     

    4,941.45

    plus

    7.80%

    93,050

    191,600

    413,800

     

    12,628,35

    plus

    8.80%

    191,600

    413,800

    and over

     

    32,181.95

    plus

    8.95%

    413,800

    Married

    If the Amount of
    Taxable Income Is:

    The Amount of Vermont
    Tax Withholding Should Be:

    Over:

    But Not Over:

     

    Of Excess Over:

    $0

    $8,000

     

    $0.00

    plus

    0.00%

    $0

    8,000

    68,700

     

    0.00

    plus

    3.55%

    8,000

    68,700

    159,800

     

    2,154.85

    plus

    6.80%

    68,700

    159,800

    239,050

     

    8,349.65

    plus

    7.80%

    159,800

    239,050

    420,100

     

    14,531.15

    plus

    8.80%

    239,050

    420,100

    and over

     

    30,463.55

    plus

    8.95%

    420,100
  7. Divide the annual tax withholding by 26 to obtain the biweekly Vermont tax withholding. If Federal exemptions were used and there are additional Federal withholdings, proceed to step 8.
  8. If Federal exemptions were used and additional Federal tax was withheld, multiply the additional amount by 27 percent and add that to the result of step 7 to obtain the biweekly Vermont tax withholding.