Below is a list of Vermont's subtractions from income with a brief description, as well.
Adjustment for Prior Year's Past Bonus Depreciation (Form IN-112)
If you claimed bonus depreciation in the previous year, you can subtract the difference between the MACRS depreciation and federal depreciation from your federal return.
Railroad Retirement Income (Form IN-112)
You may enter the amount you received in Railroad Retirement income. Even though this income is taxable on a federal level, it is exempt from Vermont tax. Enter only the amount that is included in your federal AGI.
Military Pay (Form IN-113)
You may enter the amount of VT exempt military pay received in 2022 that is included in your Federal adjusted gross income. Exempt military pay is:
- Wages earned from the armed services for full-time active duty outside of VT. You may be asked to provide the Required Supporting Documents Required: Copy of active duty orders.
- Up to $2,000 for National Guard or U.S. Reserve training pay earned in VT if your adjusted gross income for tax year 2022 is less than $50,000. You may be asked to provide the Required Supporting Documents: Copy of DFAS form or certification statement from unit that all training was completed during the calendar year.
- Student loan repayment can be taken only if the amount is included in your adjusted gross income. You may enter the repayment benefit made under 10 U.S.C. Chapters 109 and 1609 for 2022. You may be asked to provide Required Supporting Documents: Certification statement from armed services showing your name, address, social security number, amount of student loan repayment, and payment date.
VT Telecommunication Authority Bond/Note Interest (Form IN-113)
Interest income from a bond or note from VT telecommunication Authority is exempt from Vermont tax in the extent that is was included in your federal AGI.
VT-based Solar Energy Credit (Form IN-119)
Any unused VT-based business solar energy credit can be carried forward for 5 years following the year the credit was claimed.
Investment Tax Credit (Form IN-119)
This credit is limited to the amount of Investment Tax Credit attributable to the Vermont-property portion from federal Form 3468.
To enter any of the following subtractions from income on your Vermont return within your account, please follow the steps below:
- State Section
- Subtractions from Income