Individual Income

Penalty & Interest Charges

The underpayment in each quarter is assessed from the estimated payment due date to the date the tax is paid:

• Interest of 0.8% per month.
• Penalty of 1% per month.

Calculating the Charges: Use VT Worksheet IN-152 to calculate the amount. Enter the result on Form IN-111, Section 9, Line 36, and include the amount with your tax payment. Payment at the time of filing may reduce the charges as they accrue up to the time of payment. If you have an overpayment but owe underpayment charges, the charges are subtracted from the overpayment. NOTE: If you annualize for Federal estimated tax payments, use VT Worksheet IN-152A.

Penalty and Interest Calculator (.xls)
Penalty and Interest Calculator - Annualized (.xls)

Exceptions to Charges: (1) Taxpayers with occupations as farmers or fishermen are not required to make estimated payments. If you are billed, contact the Department to have the bill adjusted. (2) Taxpayers using the annualized method for Federal estimated payments should use IN-152A to calculate applicable interest and penalty and send a copy of the Federal Form 2210 with supporting pages to the Department.

Next Year: If you owed more than $500 tax this year or you made
estimated payments for tax year 2007, the Department automatically sends you VT Form IN-114 voucher booklet for 2008 tax year. Estimated payments are due April 15, June 15, and September 15, 2008 and January 15, 2009. To assure you do not owe more than $500 tax next year, you may wish to adjust your withholding, or make estimated payments, or a combination of both.

Taxpayer Information Line:
1.866.828.2865 (Toll-free in VT)
or 802.828.2865 (Local & Out-of-State)