Vermont homeowners may need to complete Form HS-122, Homestead Declaration, to identify property as their Vermont homestead and, if eligible, claim the Vermont Property Tax Credit.
The Homestead Declaration and Property Tax Credit are completed together through the same section of your Vermont return.
What Is the Vermont Homestead Declaration?
The Vermont Homestead Declaration is filed annually by Vermont resident homeowners to identify a property as their primary residence for education property tax purposes.
A property declared as a homestead is taxed at the homestead education property tax rate. Property that is not a homestead is generally taxed at the non-homestead education property tax rate.
All Vermont resident homeowners must file a Homestead Declaration each year, even if they:
- Are not claiming a Property Tax Credit
- Are not required to file a Vermont income tax return
- Do not owe Vermont income tax
What Is the Vermont Property Tax Credit?
The Vermont Property Tax Credit helps eligible homeowners offset a portion of their property taxes.
The credit is based on information reported on:
- Form HS-122, Homestead Declaration
- Schedule HI-144, Household Income
If you qualify, the credit is generally applied toward your property tax bill.
Who Qualifies for the Vermont Property Tax Credit?
To be eligible for the Property Tax Credit:
- The property must qualify as your Vermont homestead.
- You must file a Homestead Declaration.
- You must have been domiciled in Vermont for the entire tax year.
- You cannot be claimed as a dependent on another taxpayer's return.
- Your household income must meet Vermont's eligibility requirements.
Eligibility requirements and income limitations may change from year to year.
Business and Rental Use of Your Home
If part of your home is used for business or rental purposes, additional information must be reported on Form HS-122.
Business Use
If business use is 25% or less of the home's total use, the property generally continues to qualify entirely for the homestead education property tax rate.
If business use exceeds 25%, the business-use percentage must be reported.
The percentage should match the business-use percentage reported on your federal tax return.
Rental Use
Any portion of the property rented to another person must be reported.
Unlike business use, there is no 25% allowance for rental use. The rented portion is treated as non-homestead property and is generally taxed at the non-homestead education property tax rate.
The rental-use percentage should match the percentage reported on your federal return.
When Is Form HS-122 Due?
Form HS-122 must be filed annually.
- Filing on or before the due date is considered timely.
- Filing after the due date may result in penalties.
- Vermont does not allow extensions for filing Form HS-122.
Because filing requirements and due dates can change, taxpayers should review the current Vermont instructions each year.
How Do I Complete the Vermont Homestead Declaration and Property Tax Credit in TaxSlayer?
To enter the Homestead Declaration and Property Tax Credit in TaxSlayer:
- Go to State Section.
- Select Vermont Return.
- Select Edit.
- Choose Homestead Declaration and Property Tax Credit (HS-122).
- Complete the required information.
- Complete Schedule HI-144 Household Income if required.
TaxSlayer will use the information entered to determine eligibility and calculate any available Vermont Property Tax Credit.
Additional Information
The Homestead Declaration and Property Tax Credit are closely connected. While all Vermont resident homeowners generally must file Form HS-122, only eligible homeowners may receive a Property Tax Credit. Completing both Form HS-122 and Schedule HI-144 accurately helps ensure your property is properly classified and that you receive any credit for which you qualify.
Why combine them?
- Same workflow in TaxSlayer.
- Same entry screen.
- Same audience (Vermont homeowners).
- Eliminates duplicate eligibility information.
- Gives room for future additions, such as household income requirements, Schedule HI-144 details, and links to the Vermont Renter Credit article (RCC-146).