Is Social Security Taxed in Vermont in 2026?
Is Social Security taxed in Vermont in 2026? Yes. Yes, but Vermont completely exempts Social Security benefits for single filers earning under $50,000 ($65,000 for joint filers), with a partial phaseout above those limits.
Income thresholds shown adjust annually for inflation. Figures reflect the most recently available data — always confirm the current-year threshold with your state's Department of Revenue before filing.
How Vermont's Social Security Tax Rule Works
Fully exempt below the threshold; a partial exemption phases out at higher incomes rather than disappearing all at once.
Vermont Threshold & Phaseout Rules
Calculate Your Federal Taxable Benefits
State taxes on Social Security start with your federally taxable benefits. Use our free interactive tool to compute your Combined Income threshold.
Compare With Other Social Security Taxing States
Only 8 states in the US tax Social Security in 2026. Explore how other taxing states structure their exemptions:
Frequently Asked Questions (Vermont)
Is Social Security taxed in Vermont?
Yes, Vermont is one of only 8 states that levy state income tax on Social Security benefits in 2026. However, Yes, but Vermont completely exempts Social Security benefits for single filers earning under $50,000 ($65,000 for joint filers), with a partial phaseout above those limits.
What is the top state income tax rate in Vermont?
Vermont's top marginal income tax rate for 2026 is 8.75%. The actual tax paid on Social Security benefits depends on your taxable threshold and eligible deductions.
How can retirees in Vermont minimize Social Security tax?
Retirees can minimize state tax on benefits by managing their Modified Adjusted Gross Income (MAGI) through strategic Roth IRA distributions, timing traditional retirement account withdrawals, and maximizing age-specific deductions.