Vermont offers special benefits for service members, veterans, and their families, including property tax exemptions, state employment preferences, education and tuition assistance, vehicle tags, and hunting and fishing license privileges. Eligibility for some benefits may depend on residency, military component, and Veteran disability status. The following are benefits for the state of Vermont.
Vermont Veteran Financial Benefits
- Vermont Income Tax Exemptions for Military Pay: Military pay is exempt from Vermont income taxes for Service members serving on full-time active duty in the U.S. Armed Forces when the pay is earned outside of Vermont.
Up to $2,000 of military pay is tax-exempt for service in the Vermont National Guard or the U.S. Armed Forces Reserves if the Service member’s federal adjusted gross income is less than $50,000.
If funds received through the College Loan Repayment Program are included in the federal adjusted gross income, they are exempt from Vermont income taxes.
- Vermont Income Taxes on Military Retired Pay: Vermont resident retired Service members who have an annual gross income of $50,000 or less for single filers or $65,000 or less for joint filers receive a tax exemption on the first $10,000 of their military retired pay from Vermont income taxes.
Thrift Savings Plan (TSP) does not withhold taxes for state or local income tax, but it is reported annually on IRS Form 1099-R. All TSP distributions are subject to state taxes, and early distributions may incur higher taxes.
- Vermont Taxes on Military Disability Retirement Pay: Military Disability Retirement Pay received as a pension, annuity, or similar allowance for personal injury or sickness resulting from active service in the U.S. Armed Forces should not be included in taxable income. Some of the payments that are considered disability benefits include:
- Disability compensation and pension payments for disabilities paid to Veterans or their Families
- Grants for homes designed for wheelchair living
- Grants for motor vehicles for Veterans who lost their sight or the use of limbs or
- Benefits under a dependent-care assistance program
- Vermont Taxes on U.S. Department of Veterans Affairs Disability Dependency and Indemnity Compensation (DIC): DIC is a tax-free monetary benefit paid to eligible survivors of military Service members who died in the line of duty or eligible survivors of Veterans whose death resulted from a service-connected injury or disease.
- Vermont Taxes on Military Survivor Benefit Plan (SBP)/ Reserve Component Survivor Benefit Plan (RCSBP)/ Retired Serviceman’s Family Protection Plan (RSFPP) Military SBP/RCSBP/RSFPP: A Surviving Spouse who has an annual gross income of $50,000 or less is eligible for a tax exemption on the first $10,000 of their survivor annuity.
- Vermont Property Tax Filing Benefits for U.S. Armed Forces Service Members During Military Conflict: Vermont offers tax filing extensions to the following Service members:
- Reserve component Service members called up for full-time active duty in the U.S. Armed Forces because of a military conflict in an area designated as a combat zone (duty does not need to be performed within the combat zone) or
- Service member serving in an area designated as a combat zone or
- Service member hospitalized due to injuries received during qualified service
Service members meeting the eligibility requirements above are eligible for the following filing benefits:
Income Tax Extension: 180-day extension to file income tax after qualifying service ends.
Penalty and Interest Exemption for Property Tax: 180-day extension to file property tax without penalty, fee, or interest. This extension must be approved by the local municipality. Contact the town clerk in the town where your property is located for instructions to request this exemption.
- Homestead Declaration Abatement: If a resident Service member’s Vermont Homestead Declaration was late or incorrect due to active duty service in the U.S. Armed Forces, they may qualify for 180-day abatement. The local municipality has the authority to abate all or a portion of the Service member’s property tax. Contact the town clerk where the property is located for instructions to request this abatement.
- Combat Zone Property Tax Credit and Renter Rebate: Qualified Service members are eligible for a 180-day extension to file a Vermont Property Tax Credit or a Vermont Renter Credit. Applicants may file online using their tax software, the myVTax webpage, or they can mail their completed Vermont Homestead Declaration and Property Tax Adjustment Claim or Vermont Renters Credit Claim (found in the Vermont Income Tax Return Booklet, Forms, and Instructions) and documentation of their service.
- Vermont Property Tax Exemption for Disabled Veterans and their Survivors: Vermont offers a property tax exemption to disabled Veterans and their survivors on the first $10,000 of the appraised value of their home. Local municipalities may vote to increase this exemption up to $40,000.
The exemption only applies to the primary residence that is owned by the Veteran or their survivor. Veterans and survivors who rent their homes are not eligible for this exemption.
Who is eligible for the Vermont Property Tax Exemption for Disabled Veterans and their Survivors? To be eligible, applicants must meet one of the following requirements:
- Veterans who have a service-connected disability rating from the VA of 50% or higher
- Veterans who receive a non-service-connected disability pension from the VA
- Veterans who received a permanent medical retirement from the U.S. Armed Forces
- Un-remarried Surviving Spouses or minor Children of Veterans who were eligible for the exemption at the time of their death
- Statewide: 6.0%
- Counties: can levy a sales tax of no more than 1.0%
- Current average sales tax (with local taxes included): 6.30%
Disabled Veteran Hunting & Fishing License: Veterans with a disability rating of at least 60% can get a free lifetime hunting and fishing license.
Hunting and Fishing Licenses for Non-Resident Veterans: Non-resident Veterans who live in a state that provides reciprocal privilege for Vermont residents and who would qualify for a free license under the disabled Veteran provision above if they were a Vermont resident, can get free one-year fishing, hunting or combination hunting and fishing license.
Active Duty Hunting & Fishing Licenses: Active duty members can get free fishing and hunting licenses by signing paperwork that certifies their active duty status. Non-residents on active duty in Vermont can get hunting & fishing licenses at the resident rate.
Green Mountain Passport: Vermont Veterans can get the Green Mountain Passport for $2. Veterans with a disability rating of at least 60% can get it for free.
Vermont National Guard Tuition Benefit Program: This program was established as an interest-free and forgivable loan program in 2018 by the Vermont General Assembly. Loan forgiveness means that you no longer have to pay part, or all, of the loan. The goal is to recruit and retain high-quality VTNG members.
Who is eligible for the Vermont National Guard Tuition Benefit Program? To receive this award, you must:
- Attend a Vermont university, college, or eligible training institution offering certificate training or continuing education programs
- Not have previously earned an undergraduate bachelor’s degree
- Demonstrate satisfactory academic progress
- Be an active member in good standing of the Vermont National Guard
- Have successfully completed basic training or commissioning
- Have exhausted any post 9/11/2011 tuition benefits and other federally funded military tuition assistance, not including Montgomery GI Bill benefits, post-September 11, 2001 educational program housing allowances, federal educational entitlements, National Guard scholarship grants, loans under the National Guard Educational Assistance Program, and other nontuition benefits.
Vermont Armed Services Scholarship: This program was created by the Vermont Legislature to provide free tuition for the Families of Vermont National Guard (VTNG), or U.S. active reserve or active armed services members who have died while on active or inactive duty.
Vermont Interstate Compact on Educational Opportunity for Military Children: It is the purpose of this compact to remove barriers to educational success imposed on children of military families because of frequent moves and deployment of their parents by:
- Facilitating the timely enrollment of children of military families and ensuring that they are not placed at a disadvantage due to difficulty in the transfer of educational records from the previous school district or variations in entrance or age requirements.
- Facilitating the student placement process through which children of military families are not disadvantaged by variations in attendance requirements, scheduling, sequencing, grading, course content or assessment
- Facilitating the qualification and eligibility for enrollment, educational programs, and participation in extracurricular academic, athletic and social activities
- Facilitating the on-time graduation of children of military families
- Providing for the promulgation and enforcement of administrative rules implementing the provisions of this compact
- Providing for the uniform collection and sharing of information between and among member states, schools and military families under this compact
- Promoting coordination between this compact and other compacts affecting military children
- Promoting flexibility and cooperation between the educational system, parents and the student in order to achieve educational success for the student
Housing: The following are the sites for Veterans Homes
Eligibility for admission:
- Honorably discharged
- Have at least 90 days of service
- Vermont veterans have priority admission but veterans from other states are welcome to apply
- Veterans without Medicare, Medicaid, or private insurance will have to pay for their care, but the home’s staff will help make sure all available insurance programs are used if the individual is eligible
Employment and Job Training: Veteran’s Preference
By Federal law, Veterans who are disabled or who served on active duty in the United States Armed Forces during certain specified time periods or in military campaigns are entitled to preference over non-Veterans both in hiring into the Federal civil service and in retention during a reduction in force. Veterans may be entitled to 5 or 10 points included in any scoring process for examination or interviews. Eligible veterans can also apply for jobs that normally are available only to current state employees.
Vermont Employees Authorized Absence for Military Training: Any duly qualified member of the Reserve Components of the U.S. Armed Forces, of the Ready Reserve, or an organized unit of the Vermont National Guard or the National Guard of another state shall upon request be entitled to leaves of absence for a total of 15 days in any calendar year for the purpose of engaging in military drill, training, or other temporary duty under military authority. A leave of absence shall be with or without pay as determined by the employer. Upon completion of the military drill, training, or other temporary duty under military authority, a permanent employee shall be reinstated in that position with the same status, pay, and seniority, including seniority that accrued during the period of absence.
Vermont CDL Military Skills Test Waiver: Service members who have a military CDL and have driven a commercial vehicle in the last 12 months may have their skills test waived when applying for a CDL.
Uniformed Services Employment and Reemployment Rights Act: Uniformed Services Employment and Reemployment Rights Act (USERRA) protect civilian job rights and benefits for Veterans and members of Reserve components. USERRA also makes major improvements in protecting service member rights and benefits by clarifying the law, improving enforcement mechanisms, and adding Federal Government employees to those employees already eligible to receive the Department of Labor assistance in processing claims.
Burials and Memorials
Please note that your preference regarding burial in a national cemetery and use of a headstone provided by VA should be documented and kept with your paperwork and medical records.
The National Cemetery Administration (NCA) pays tribute to eligible Veterans and their family members by providing a final resting place and a lasting memorial to commemorate the Veteran’s dedicated service to the nation.
The burial benefits encompass a gravesite in any of our open cemeteries with available space, the opening and closing of the grave, perpetual care, a government-furnished headstone or marker, a burial flag, and a Presidential Memorial Certificate, all at no cost to the family. Some Veterans may also meet the criteria for a burial allowance. Cremated remains are interred or inurned in national cemeteries with the same honors and respect as casketed remains.
Burial benefits extend to eligible spouses and dependents, including burial alongside the Veteran and perpetual care of the interment site. The name and relevant dates of birth and death of the spouse or dependent are inscribed on the Veteran’s headstone at no expense to the family. Importantly, spouses and qualified dependents are eligible for burial even if they pass away before the Veteran and are not required to be interred in the same national cemetery as the Veteran.
National Cemeteries include:
Brattleboro: Prospect Hill Cemetery Soldiers’ Lot (VT)
Montpelier: Green Mount Cemetery Soldiers’ Lot
Vermont VA Benefit Resources
Vermont provides Veterans with a Regional Benefits Office and a VA Medical Center.
Vermont VA Regional Benefits Office
- White River Junction: White River Junction Regional Office
Vermont VA Medical Centers
- White River Junction: White River Junction VA Medical Center
Important information for Vermont Veteran Benefits:
For Veterans applying for VA benefits for the first time, you must submit a copy of your DD 214 (discharge paperwork). This will provide your discharge status, full name, social security number, branch of service, and dates for which you served. Honorable and general discharges qualify a Veteran for most VA benefits.
You should always keep your paperwork and medical records in a safe place where you and your family can access them. It is imperative to have it in a location where it cannot be destroyed or tampered with, which includes a safe.
Your eligibility for most VA benefits is based upon discharge from active military service under conditions other than dishonorable. Active service means full-time service as a member of the Army, Navy, Air Force, Marine Corps, or Coast Guard or as a commissioned officer of the Public Health Service, the Environmental Services Administration, or the National Oceanic and Atmospheric Administration.
Any Veteran discharged from the military under the conditions of “Dishonorable” due to bad conduct discharges issued by general courts-martial may bar VA benefits. Veterans in prison and parolees may be eligible for certain VA benefits. VA regional offices can clarify the eligibility of prisoners, parolees, and individuals with multiple discharges issued under differing conditions.
*This information is accurate as of November 2023
Vermont Veteran Benefits
If you are a disabled Veteran in Vermont and are VA rated 90% or less, you may be eligible for additional benefits. Contact Veterans Guardian for a free consultation with no obligation. Let us review your claim to determine if you are eligible for an increase in VA compensation and whether you qualify for additional benefits.