Vermont 2025-2026 Regular Session

Vermont House Bill H0483 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	BILL AS INTRODUCED H.483
2	2	2025 Page 1 of 8
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5	5	VT LEG #381328 v.1
6	6	H.483 1
7	7	Introduced by Committee on Ways and Means 2
8	8	Date: 3
9	9	Subject: Taxation; income tax; tax credits 4
10	10	Statement of purpose of bill as introduced: This bill proposes to expand the 5
11	11	eligibility requirement for the Vermont Child Tax Credit to allow a credit for 6
12	12	children six years of age or younger, expand the earned income tax credit for 7
13	13	individuals without qualifying children to 100 percent of the federal credit, and 8
14	14	increase the income thresholds used to determine eligibility for the partial 9
15	15	exemption of Social Security benefits and retirement income. 10
16	16	An act relating to the expansion of existing income tax credits 11
17	17	It is hereby enacted by the General Assembly of the State of Vermont: 12
18	18	Sec. 1. PURPOSE 13
19	19	The purpose of this act is to: 14
20	20	(1) expand the eligibility requirement for the Vermont Child Tax Credit 15
21	21	to allow a credit for children six years of age or younger; 16
22	22	(2) expand the earned income tax credit for individuals without 17
23	23	qualifying children to 100 percent of the federal credit; and 18
24	24	(3) increase the income thresholds used to determine eligibility for the 19
25	25	partial exemption of Social Security benefits and retirement income. 20 BILL AS INTRODUCED H.483
26	26	2025 Page 2 of 8
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29	29	VT LEG #381328 v.1
30	30	Sec. 2. 32 V.S.A. § 5830f is amended to read: 1
31	31	§ 5830f. VERMONT CHILD TAX CREDIT 2
32	32	(a) A resident individual or part-year resident individual who is entitled to a 3
33	33	child tax credit under the laws of the United States or who would have been 4
34	34	entitled to a child tax credit under the laws of the United States but for the fact 5
35	35	that the individual or the individual’s spouse does not have a taxpayer 6
36	36	identification number shall be entitled to a refundable credit against the tax 7
37	37	imposed by section 5822 of this title for the taxable year. The total credit per 8
38	38	taxable year shall be in the amount of $1,000.00 per qualifying child, as 9
39	39	defined under 26 U.S.C. § 152(c) but notwithstanding the taxpayer 10
40	40	identification number requirements under 26 U.S.C. § 24(e) and (h)(7), who is 11
41	41	five six years of age or younger as of the close of the calendar year in which 12
42	42	the taxable year of the taxpayer begins. For a part-year resident individual, the 13
43	43	amount of the credit shall be multiplied by the percentage that the individual’s 14
44	44	income that is earned or received during the period of the individual’s 15
45	45	residency in this State bears to the individual’s total income. An otherwise 16
46	46	eligible individual shall be entitled to the credit under this section without 17
47	47	regard for the laws of the United States pertaining to the amount of federal 18
48	48	child tax credit that may be refunded. 19
49	49	* * * 20 BILL AS INTRODUCED H.483
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54	54	Sec. 3. 32 V.S.A. § 5828b is amended to read: 1
55	55	§ 5828b. EARNED INCOME TAX CREDIT 2
56	56	(a) A resident individual or part-year resident individual who is entitled to 3
57	57	an earned income tax credit granted under the laws of the United States or who 4
58	58	would have been entitled to an earned income tax credit under the laws of the 5
59	59	United States but for the fact that the individual, the individual’s spouse, or one 6
60	60	or more of the individual’s children does not have a qualifying taxpayer 7
61	61	identification number shall be entitled to a credit against the tax imposed for 8
62	62	each year by section 5822 of this title. The credit shall be for an individual 9
63	63	who claims one or more qualifying children 38 percent or for an individual 10
64	64	who does not claim one or more qualifying children 100 percent of the earned 11
65	65	income tax credit granted to the individual under the laws of the United States 12
66	66	or that would have been granted to the individual under the laws of the United 13
67	67	States but for the fact that the individual, the individual’s spouse, or one or 14
68	68	more of the individual’s children does not have a qualifying taxpayer 15
69	69	identification number, multiplied by the percentage that the individual’s 16
70	70	income that is earned or received during the period of the individual’s 17
71	71	residency in this State bears to the individual’s total income. A resident 18
72	72	individual or part-year resident individual who would have been entitled to or 19
73	73	granted an earned income tax credit under the laws of the United States but for 20
74	74	the fact that the individual, the individual’s spouse, or one or more of the 21 BILL AS INTRODUCED H.483
75	75	2025 Page 4 of 8
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79	79	individual’s children does not have a qualifying taxpayer identification number 1
80	80	shall be entitled to a credit under this section. 2
81	81	* * * 3
82	82	Sec. 4. 32 V.S.A. § 5830e is amended to read: 4
83	83	§ 5830e. RETIREMENT INCOME; SOCIAL SECURITY INCOME 5
84	84	(a) Social Security income. The portion of federally taxable Social 6
85	85	Security benefits excluded from taxable income under subdivision 7
86	86	5811(21)(B)(iv) of this chapter shall be as follows: 8
87	87	(1) For taxpayers whose filing status is single, married filing separately, 9
88	88	head of household, or surviving spouse: 10
89	89	(A) If the federal adjusted gross income of the taxpayer is less than or 11
90	90	equal to $50,000.00 $55,000.00, all federally taxable benefits received under 12
91	91	the federal Social Security Act shall be excluded. 13
92	92	(B) If the federal adjusted gross income of the taxpayer is greater than 14
93	93	$50,000.00 $55,000.00 but less than $60,000.00 $65,000.00, the percentage of 15
94	94	federally taxable benefits received under the Social Security Act to be 16
95	95	excluded shall be proportional to the amount of the taxpayer’s federal adjusted 17
96	96	gross income over $50,000.00 $55,000.00, determined by: 18
97	97	(i) subtracting the federal adjusted gross income of the taxpayer 19
98	98	from $60,000.00 $65,000.00; 20 BILL AS INTRODUCED H.483
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103	103	(ii) dividing the value under subdivision (i) of this subdivision (B) 1
104	104	by $10,000.00; and 2
105	105	(iii) multiplying the value under subdivision (ii) of this subdivision 3
106	106	(B) by the federally taxable benefits received under the Social Security Act. 4
107	107	(C) If the federal adjusted gross income of the taxpayer is equal to or 5
108	108	greater than $60,000.00 $65,000.00, no amount of the federally taxable 6
109	109	benefits received under the Social Security Act shall be excluded under this 7
110	110	section. 8
111	111	(2) For taxpayers whose filing status is married filing jointly: 9
112	112	(A) If the federal adjusted gross income of the taxpayer is less than or 10
113	113	equal to $65,000.00 $70,000.00, all federally taxable benefits received under 11
114	114	the Social Security Act shall be excluded. 12
115	115	(B) If the federal adjusted gross income of the taxpayer is greater than 13
116	116	$65,000.00 $70,000.00 but less than $75,000.00 $80,000.00, the percentage of 14
117	117	federally taxable benefits received under the Social Security Act to be 15
118	118	excluded shall be proportional to the amount of the taxpayer’s federal adjusted 16
119	119	gross income over $65,000.00 $70,000.00, determined by: 17
120	120	(i) subtracting the federal adjusted gross income of the taxpayer 18
121	121	from $75,000.00 $80,000.00; 19
122	122	(ii) dividing the value under subdivision (i) of this subdivision (B) 20
123	123	by $10,000.00; and 21 BILL AS INTRODUCED H.483
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127	127	VT LEG #381328 v.1
128	128	(iii) multiplying the value under subdivision (ii) of this subdivision 1
129	129	(B) by the federally taxable benefits received under the Social Security Act. 2
130	130	(C) If the federal adjusted gross income of the taxpayer is equal to or 3
131	131	greater than $75,000.00 $80,000.00, no amount of the federally taxable 4
132	132	benefits received under the Social Security Act shall be excluded under this 5
133	133	section. 6
134	134	(b) Civil Service Retirement System income. The portion of income 7
135	135	received from the Civil Service Retirement System excluded from taxable 8
136	136	income under subdivision 5811(21)(B)(iv) of this title shall be subject to the 9
137	137	limitations under subsection (e) of this section and shall be determined as 10
138	138	follows: 11
139	139	(1) For taxpayers whose filing status is single, married filing separately, 12
140	140	head of household, or surviving spouse: 13
141	141	(A) If the federal adjusted gross income of the taxpayer is less than or 14
142	142	equal to $50,000.00 $55,000.00, the first $10,000.00 of income received from 15
143	143	the Civil Service Retirement System shall be excluded. 16
144	144	(B) If the federal adjusted gross income of the taxpayer is greater than 17
145	145	$50,000.00 $55,000.00 but less than $60,000.00 $65,000.00, the percentage of 18
146	146	the first $10,000.00 of income received from the Civil Service Retirement 19
147	147	System to be excluded shall be proportional to the amount of the taxpayer’s 20
148	148	federal adjusted gross income over $50,000.00 $55,000.00, determined by: 21 BILL AS INTRODUCED H.483
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153	153	(i) subtracting the federal adjusted gross income of the taxpayer 1
154	154	from $60,000.00 $65,000.00; 2
155	155	(ii) dividing the value under subdivision (i) of this subdivision (B) 3
156	156	by $10,000.00; and 4
157	157	(iii) multiplying the value under subdivision (ii) of this subdivision 5
158	158	(B) by the first $10,000.00 of income received from the Civil Service 6
159	159	Retirement System. 7
160	160	(C) If the federal adjusted gross income of the taxpayer is equal to or 8
161	161	greater than $60,000.00 $65,000.00, no amount of the income received from 9
162	162	the Civil Service Retirement System shall be excluded under this section. 10
163	163	(2) For taxpayers whose filing status is married filing jointly: 11
164	164	(A) If the federal adjusted gross income of the taxpayer is less than or 12
165	165	equal to $65,000.00 $70,000.00, the first $10,000.00 of income received from 13
166	166	the Civil Service Retirement System shall be excluded. 14
167	167	(B) If the federal adjusted gross income of the taxpayer is greater than 15
168	168	$65,000.00 $70,000.00 but less than $75,000.00 $80,000.00, the percentage of 16
169	169	the first $10,000.00 of income received from the Civil Service Retirement 17
170	170	System to be excluded shall be proportional to the amount of the taxpayer’s 18
171	171	federal adjusted gross income over $65,000.00 $70,000.00, determined by: 19
172	172	(i) subtracting the federal adjusted gross income of the taxpayer 20
173	173	from $75,000.00 $80,000.00; 21 BILL AS INTRODUCED H.483
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178	178	(ii) dividing the value under subdivision (i) of this subdivision (B) 1
179	179	by $10,000.00; and 2
180	180	(iii) multiplying the value under subdivision (ii) of this subdivision 3
181	181	(B) by the first $10,000.00 of income received from the Civil Service 4
182	182	Retirement System. 5
183	183	(C) If the federal adjusted gross income of the taxpayer is equal to or 6
184	184	greater than $75,000.00 $80,000.00, no amount of the income received from 7
185	185	the Civil Service Retirement System shall be excluded under this section. 8
186	186	* * * 9
187	187	Sec. 5. EFFECTIVE DATE 10
188	188	Notwithstanding 1 V.S.A. § 214, this act shall take effect retroactively on 11
189	189	January 1, 2025 and shall apply to taxable years beginning on and after 12
190	190	January 1, 2025. 13