VT Property Transfer Tax Rules

Big updates are here for Vermont’s Property Transfer Tax, which is due upon closing day when purchasing property in VT. This is normally paid by the homebuyer. Here’s what you need to know:

General Tax Rate

• • Remains 1.25% (no changes).

Clean Water Surcharge

• • Increased from 0.2% to 0.22%.

• • Exemption amounts are higher, reducing costs for some buyers.

Principal Residences

• • The special rate of 0.5% stays the same, but now applies to the first $200,000 (up from $100,000).

• • Above $200,000, the 1.25% General Rate + 0.22% Clean Water Surcharge (total 1.47%) applies.

Non-Principal Residences

• • Tax rate jumps to 3.40%, or 3.62% with the Clean Water Surcharge, for properties like second homes or year-round rentals.

Updated Exemptions

1. 1. Exemption 99:
      • • For principal residences funded by VHCB, VHFA, or USDA grants, the exempt value increases to $250,000 (up from $110,000).
      • • Above $250,000, the 1.47% rate applies.

1. 1. New Exemptions:
      • • Abandoned Dwellings: Municipality-purchased properties for rehab as principal residences are exempt if conditions are met within 3 years.
      • • ENERGY STAR Mobile Homes: Zero Energy Ready mobile homes certified by the U.S. DOE are fully exempt.

Have Questions?

Understanding these changes can make a big difference in your real estate transaction. Contact us for personalized guidance or to discuss how these updates may affect you.