Retiring in Vermont

Every figure below is sourced to Vermont’s own publications and dated. Estimates only, and not tax advice.

Retirement tax by state

What your state actually takes from a 401(k) withdrawal, a pension, and Social Security — in dollars, not a yes/no list.

Brokerage account growth

Long-term index-fund growth after expense-ratio drag — and what your state takes from the gains at withdrawal.

Roth vs. Traditional

Decided on the two rates that actually govern it — yours now, and yours at withdrawal, in the state you'll retire in rather than the one you're in.

Contribution limit optimizer

2026 limits, employer match, the 60-63 super catch-up, and whether the Roth catch-up mandate applies to you.

Required minimum distribution

When your RMDs start under SECURE 2.0, how much this year's is, and what missing it costs.

Backdoor Roth pro-rata

What a backdoor Roth conversion would actually cost you in tax — the pro-rata rule most calculators only describe.

Self-directed IRA real estate (UDFI)

The tax a leveraged rental owes inside a self-directed IRA — computed at trust rates, not the rate you'd assume.

Vermont at a glance

401(k) and IRA withdrawals
Taxed
Social Security
Taxed above an income threshold
Below the threshold it is exempt, which is why a yes-or-no answer is usually wrong here.
Top marginal rate
8.75%
The top of 4 graduated brackets.
Tax year
2026
Brackets are legislated and change on a fixed calendar, so the year matters.
  • The Social Security and military retirement figures recorded here reflect 2025 Acts and Resolves No. 71, sec. 3, effective January 1, 2025, which raised the Social Security thresholds and replaced the former flat $10,000 military retirement exclusion with a full exclusion below $125,000 of federal AGI. Any source describing Vermont as excluding only the first $10,000 of military retirement pay, or as using $50,000/$65,000 Social Security thresholds, is pre-2025.
  • Vermont's exclusions are keyed to FEDERAL adjusted gross income, not to Vermont taxable income, so they are evaluated before the standard deduction and personal exemptions and cannot be managed downward by Vermont-specific deductions.
  • For adjusted gross income above $150,000, Vermont applies a minimum tax floor: the tax on Form IN-111 line 8 is the GREATER of 3% of adjusted gross income less interest from U.S. obligations, or the ordinary rate schedule calculation. A calculator that applies only the bracket schedule will understate the liability of a high-AGI filer with large deductions or exclusions.
  • THE BRACKET THRESHOLDS IN THIS RECORD ARE TAX YEAR 2025 DOLLARS, and dollarFiguresYear says so. The four RATES are confirmed for 2026 from the Department's own GB-1210 withholding publication, but Vermont's published '2026 VT Rate Schedules' link serves the 2026 wage bracket withholding charts rather than the rate schedules, so no 2026 threshold table could be sourced. Because 2026 thresholds are indexed upward, a 2026 calculation using this record will slightly overstate Vermont tax. See the brackets source entry.