Vermont Homestead Property Tax Credit

Vermont Homestead Property Tax Credit

Vermont homeowners use this annual filing process to declare a qualifying home as a homestead and, when they meet the income and other rules, claim a state Property Tax Credit. The program is administered by the Vermont Department of Taxes. It is not an automatic discount and it is not a one-time benefit attached permanently to a property. A homeowner must file for each year in which the home is being declared and must use the forms and property-tax information for that cycle.

The current page covers the 2026 filing cycle. The regular April filing date has passed, but the Department’s 2026 form and instructions say that a Homestead Declaration and Property Tax Credit claim may still be filed through October 15, 2026. Because the late window is still open, this page uses a rolling deadline. A late filing can carry a municipal penalty, and a claim submitted after the October date generally cannot be accepted.

At a glance

The $8,000 figure is a maximum, not a guaranteed payment. The actual credit depends on the figures reported on the claim, the household-income calculation, ownership interest, and the applicable Vermont calculation. The credit appears as a state payment on the 2026/2027 property-tax bill when a claim is approved.

Two connected filings

The process has two related parts:

1. Homestead Declaration, HS-122 Section A. This tells Vermont that the property is your homestead for education-property-tax purposes. Every Vermont resident whose property meets the homestead definition must file this declaration each year.
2. Property Tax Credit Claim, HS-122 Section B. This asks Vermont to calculate the income-based credit. It is optional in the sense that a homeowner may file the declaration without claiming the credit, but it cannot be processed by itself.

Anyone claiming the credit must also complete and attach Schedule HI-144, Household Income. The 2026 package uses the 2025 calendar year for household income. Filing only Section B, or filing HS-122 without the required HI-144, leaves the credit claim incomplete and generally unprocessable.

Who qualifies for the Homestead Declaration

For the 2026 declaration, the official instructions require that you own the Vermont property as your principal residence as of April 1, 2026 and expect to physically occupy it as your domicile. The declaration is still required even if it is filed late. A Vermont homestead is the principal dwelling and the surrounding parcel used as the resident individual’s domicile. A second home, camp, summer cottage, commercial property, or a home that is not your principal residence is not automatically a homestead.

The instructions allow a specific rental exception: if the home is leased to a tenant on April 1, 2026, it may still qualify if it is not leased for more than 182 days in the 2026 calendar year. Rental and business use must be reported on the form. Do not assume that a home remains wholly homestead property simply because the owner lives there; Vermont may classify part of a property as nonhomestead when the facts require it.

Joint owners should review the ownership and occupancy facts carefully. The official instructions say that when there is more than one owner, only one owner occupant should file the declaration. Life-estate holders who occupy the dwelling as their principal residence, certain qualifying trusts, and some estate situations have separate rules. If the property crosses town boundaries, the form calls for a declaration for each town. Those situations are worth checking against the current instructions before submitting.

Additional requirements for the Property Tax Credit

The 2026 HS-122 instructions list all of these requirements for the credit claim:

• The property must be declared as your homestead.
• You must have been domiciled in Vermont for the entire 2025 calendar year.
• You must own the property as your principal residence on April 1, 2026.
• You must not have been claimed as another taxpayer’s dependent for tax year 2025.
• Your household income must be $115,400 or less.

The income ceiling is not the same thing as federal taxable income. Schedule HI-144 defines household income as modified adjusted gross income, not less than zero, received during the calendar year by household members while they were members of the household. The instructions say household members can include a spouse or civil union partner, roommates, and family members, including children who file their own tax returns and are not dependents. A person who lived in the home for only part of 2025 may still require inclusion for the period of residence.

There are narrow exceptions, including certain legally separated spouses, some older spouses who have permanently moved to a nursing or care facility, specified home-sharing arrangements, qualifying personal-care workers, and certain temporary refugees or asylum seekers. The exact exception must match the official instructions. Do not remove a household member simply because that person did not file a joint federal return with you.

HI-144 also covers income that may be taxable or nontaxable for other purposes. The instructions identify wages, interest, dividends, Social Security, SSI, SSDI, railroad retirement, veterans’ benefits, unemployment compensation, workers’ compensation, alimony or support, business income, rental income, pensions, and other categories. They also list exclusions and adjustments, including some public assistance, certain foster-care or care payments, specified gifts, and particular retirement-account distributions. Use the current schedule rather than treating federal adjusted gross income as the answer.

What to gather before filing

Build the filing from one set of current records. You should have:

• Your 2025/2026 property-tax bill.
• The property’s 11-digit School Property Account Number, or SPAN, from that bill.
• Your Social Security number and the claimant information requested by HS-122.
• The physical location of the homestead and the Vermont city or town of legal residence as of April 1, 2026.
• The federal filing status used on your 2025 federal return, if you were required to file one.
• The housesite value, housesite education tax, and housesite municipal tax from the 2025/2026 bill.
• The household members and every relevant 2025 income source needed for HI-144.
• Ownership percentages and details of any rental, business, trust, life-estate, estate, mobile-home-lot, contiguous-property, or town-boundary issue.

The SPAN deserves special attention. Vermont uses it to associate the credit with the correct property-tax account. Copy it from the bill instead of relying on an old return or a remembered number. If the property changed ownership, the home was sold, or the intended occupancy changed before April 1, 2026, stop and review the withdrawal and eligibility instructions before filing.

How to file the 2026 cycle

1. Complete Section A

Start with the Homestead Declaration portion of HS-122. Enter the claimant, spouse or civil union partner information when applicable, mailing address, physical homestead address, legal residence, filing status, SPAN, business and rental-use percentages, and any special-situation boxes. The physical location field is not a post-office box and should identify the actual property.

2. Complete HI-144 for the credit

List the household members and calculate 2025 household income using Schedule HI-144. Follow the schedule’s definitions and exclusions. If your household changed during the year, account for the time each person was a household member. If a spouse or civil union partner does not live with you, use the specific legal-separation, protective-order, or care-facility rules rather than making a general assumption.

3. Complete Section B from the property-tax bill

Answer every eligibility question. Enter the housesite value, education tax, municipal tax, ownership interest, and HI-144 household-income result. If you have a mobile-home lot, qualifying cooperative or land-trust arrangement, or contiguous property that fits the instructions, complete the additional lines and supporting form required for that situation.

4. Sign and submit the complete package

The Department says the fastest option is to file through myVTax.vermont.gov. A paper filer should sign the claim and mail the package to Vermont Department of Taxes, PO Box 1881, Montpelier, VT 05601-1881. A credit claim consists of HS-122 Section A, HS-122 Section B, and Schedule HI-144. Keep a copy and preserve the electronic confirmation or mailing evidence.

The 2026 deadline and late filing

The regular due date was April 15, 2026. The Department’s 2026 form and instructions state that a Homestead Declaration filed after that date may still be classified as a homestead, but the town may assess a penalty of up to 3% or 8% of the education tax depending on the rate comparison. The instructions also say that a declaration filed after October 15, 2026 will be classified as nonhomestead, with the higher rate, penalty, and any additional property tax and interest due under the applicable rules.

For the Property Tax Credit, claims filed after October 15, 2026 generally cannot be accepted, and incomplete claims are considered unfiled. The 2026 instructions say that claims filed between April 16 and October 15 may still qualify. That is why the page’s structured deadline is rolling during this late window: April 15 is a passed regular date, but the opportunity has not yet closed as of the page update.

Do not interpret rolling as permission to wait. Submit a complete claim as soon as possible, check that the receipt date is recorded, and understand that a late homestead declaration or claim can produce penalties or a reduced result. An income-tax extension does not extend the Homestead Declaration deadline.

Situations that need extra care

Rental and business use should be reported even when the use is a small share of the dwelling. A sale before April 1, 2026 can affect a declaration and claim; the instructions direct taxpayers in that situation to review Form HS-122W. A home that is rented for too much of the 2026 calendar year may not meet the homestead rules. A trust, life estate, estate, mixed ownership, or property spanning towns can change who files and what percentage belongs on Section B.

The credit also has a separate ownership-interest calculation. If all eligible owners are household members occupying the property as their principal residence, the relevant interest may be 100%. If an owner does not occupy the property as a principal residence, the instructions direct the claimant to report the percentage owned by the household members who do occupy it. Use the facts and deed, not a default percentage.

If you discover an error after filing, the 2026 instructions identify housesite value, housesite education tax, housesite municipal tax, ownership percentage, and household income as items that may be amended when the original return was filed timely. An amended schedule does not make an otherwise incomplete or late original claim timely, so retain the original submission record and follow the Department’s directions.

A practical final checklist

Before submitting, confirm that:

• The property was your principal residence on April 1, 2026 and your domicile facts support the declaration.
• The credit questions are answered and you were domiciled in Vermont for all of 2025.
• You were not claimed as another taxpayer’s dependent for 2025.
• HI-144 household income is $115,400 or less under Vermont’s definitions.
• The SPAN, housesite figures, ownership interest, and 2025/2026 tax-bill information match.
• All required schedules, signatures, and special-situation forms are included.
• You save the myVTax confirmation or proof of mailing.

The official source for the program is the Vermont Department of Taxes Homestead Declaration page. The current cycle’s 2026 HS-122 form and 2026 HS-122 instructions contain the controlling deadline, eligibility, income, and filing directions. If your facts fall into a special ownership, rental, sale, or household-income category, use those instructions or contact the Department before submitting rather than guessing.