Introduced by Representative Hosford of Waitsfield
Subject: Taxation; income tax; exemption of Social Security payments
Statement of purpose: This bill proposes to exempt Social Security payments from income taxation.
AN ACT RELATING TO INCOME TAX EXEMPTION FOR SOCIAL SECURITY PAYMENTS
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. 32 V.S.A. § 5823(a) and (b) are amended to read:
§ 5823. VERMONT INCOME OF INDIVIDUALS, ESTATES AND
(a) For any taxable year, the Vermont income of a resident individual is the adjusted gross income of the individual for that taxable year, and the Vermont income of a resident estate or trust is its gross income for the taxable year, less:
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(8) Payments received under the federal Social Security Act, to the extent includible in gross income for federal income tax purposes, received by an individual or surviving beneficiary.
(b) For any taxable year, the Vermont income of a nonresident individual, estate or trust is the sum of the following items of income to the extent they are required to be included in the adjusted gross income of the individual or the gross income of an estate or trust for that taxable year:
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Wages, salaries, commissions, or other income
( excluding excluding:
pay for full-time active duty with the armed services and also excluding funds
received through the federal armed forces educational loan repayment program
under 10 U.S.C. chapters 109 and 1609; and also excluding the first $2,000.00
of military pay for unit training in the state to National Guard and United
States Reserve personnel for whom the adjutant general or reserve component
commander certifies that the taxpayer completed all unit training of his or her
unit during the calendar year, and who has a federal adjusted gross income of
$50,000.00) $50,000.00 received with respect to
services performed within this state; and also excluding
(B) income received for a dramatic performance in a commercial film production to the extent such income would be excluded from personal income taxation in the state of residence; and
(C) payments received under the federal Social Security Act, to the extent includible in gross income for federal income tax purposes, received by an individual or surviving beneficiary.
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Sec. 2. EFFECTIVE DATE
This act shall apply to taxable years beginning on or after January 1, 2006.
The Vermont General Assembly
115 State Street