The State of Vermont has sent $192 million in tax refunds to Vermonters so far for Tax Year 2025 – thanks, in part, to a multi-million-dollar tax relief package signed into law last June.

For Vermonters who filed their state income tax returns by April 15, the median refund turnaround time this year was just 12 days.

“With property taxes having skyrocketed by over 40% in just five years, you can see just how important it is that we got this money back to Vermonters who need it the most,” Tax Commissioner William Shouldice said. “That said, it’s not just about how quickly we got refunds back to Vermonters. It’s how much more we got back to them.”

Scott and Shouldice were also joined by Adjutant General Hank Harder of the Vermont National Guard, who spoke to recently enacted tax relief for Vermont’s veterans. The Vermont National Guard is “all-in on workforce development,” Harder said, but there is more to be done to recruit soldiers and airmen coming off active duty and entering the civilian workforce.

“Vermont is competing with other states for this talent. Vermont is the only state in New England that still levies state tax on military retire pay. New York also has no tax on military retire pay,” Harder said. “People getting off active duty and military retirees pay attention to these tax policies and it is a key factor in where they decide to live and work.”

Laura Sudhoff is the Volunteer Income Tax Assistance (VITA) Program Coordinator for Capstone Community Action, assisting eligible residents of Washington, Orange and Lamoille Counties file their taxes for free. Through their tax preparation services, Capstone has helped 1,800 central Vermonters file their 2025 tax returns, resulting in $600,000 in refunds so far this year.

“For the low-to-moderate income Vermonters we serve, a tax refund can make a meaningful difference. It can help a family catch up on rent or utilities, buy groceries, pay for childcare, or repair their car,” Sudhoff said at Wednesday’s press conference. “The recent changes to the Vermont tax codes have assisted many of our clients.”

As a direct result of the 2025 tax relief package (Act 71 of 2025), the Department of Taxes has reported millions of dollars returned to thousands of Vermont families, low-income residents, retirees and veterans this filing season.

• Child Tax Credit expanded eligibility: Vermont returned more than $3.6 million in new benefits to nearly 4,000 families with children under seven years old. Before last year’s bill, that credit ended when children turned six. In total, the Child Tax Credit has returned $25 million to 20,000 Vermont families for Tax Year 2025.
• Earned Income Tax Credit expansion: Act 71 increased Vermont’s match of the federal EITC rate from 38% to 100% for claimants without children. That change alone delivered an additional $2.4 million to nearly 11,000 filers. In total, Vermont’s Earned Income Tax Credit has returned $28 million to 32,000 Vermonters for Tax Year 2025.
• Social Security exemption expansion: Vermont’s Social Security exemption lowers the state income tax burden for Social Security beneficiaries who are below certain income thresholds. Act 71 increased the income threshold for full exemption of Social Security income by $5,000. That put another $1.3 million in the pockets of nearly 8,000 Vermonters.
• Military Pension and Survivor Benefit exemption expansion: For the first time, Act 71 exempted military pension and survivor benefits from income taxes for households making up to $125,000, with a partial exemption for those earning up to $175,000. So far, that has returned an additional $1.9 million to more than 2,400 military retirees or their survivors.
• Veteran Credit: Act 71 created a new refundable tax credit, up to $250, for veterans who make less than $30,000 per year. That has put roughly $439,000 back in the pockets of 1,888 low-income veterans.

The Department of Taxes estimates there are roughly 35,000 Vermonters who may qualify for refundable credits but are not receiving them. That’s because their incomes are low enough that they are not required to file a federal return. By not filing, they may be leaving hundreds or thousands of dollars in refundable credits – like the Earned Income Tax Credit, Child Tax Credit or Veteran’s Credit – on the table.

“That’s money that’s on table that Vermonters could have in their pockets to pay their groceries, pay their fuel bill, or to pay for other family related expenses,” Shouldice said. “This isn’t the State’s money. It’s Vermonters’ money. It should be circulating the state, helping families make ends meet – not sitting in the State coffers.

Vermonters who believe they may be eligible for these refundable credits can still file before October 15. Vermonters can visit tax.vermont.gov for information on how to file or call 802-828-2865 for assistance.

Additional background from the Vermont Department of Taxes:

• Of nearly 370,000 returns filed in the state this tax filing season, nearly 240,000 generated refunds.
• The median time between the Department of Taxes receiving a return and issuing a refund was 12 days.
• As of August 17, the Department of Taxes has issued $192 million in refunds to Vermonters.
• The Taxpayer Services Division fielded more than 44,000 phone calls this filing season. The average wait time for callers was just 48 seconds.
• For 4,000 filers this season, the Department of Taxes determined that they were owed larger refunds than they had expected – adjusting refunds up by approximately $3 million.
• At the same time, the Department of Taxes protected $7.8 million in taxpayer dollars from being issued in erroneous refunds.
• The Department of Taxes has processed over 175,000 homestead declarations so far this year and 84,000 of those homeowners received a Property Tax Credit.
• The Department of Taxes has processed nearly 22,000 Renter Credit claims, translating to nearly $11 million credited to renters statewide.