Certificate Checklist | Department of Taxes

Checklist by Reason Code

Loss Experienced on The Sale

May be requested any time the sale results in a loss.

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Proof of Basis
Depreciation Worksheet or Letter indicating Non Rental/Business use. Statement signed by the seller stating that the property has not been used for rental or business purposes. If this claim cannot be made, then submit a depreciation worksheet.
If Applicable:
Listing of Sale Expenses
Listing and documentation of Purchase Expenses
Improvements List and Documentation Breakdown should be a detailed list of the improvement by project with the associated cost. This does not include any repairs, maintenance, or personal property. Sales receipts are only requested if there are questions about the scope and cost of an item on the list.
Passive Loss Carryforward Amount and Documentation
Deferred Gain Amount and documentation
Letter explaining or clarifying any unusual issues

Withholding on The Gain Would Be Lower Than 2.5% Of Sale Price

May be requested if the calculation would result in 8.75% of the gain being less than 2.5% of the sale price.

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Proof of Basis
Depreciation Worksheet or Letter indicating Non Rental/Business use. Statement signed by the seller stating that the property has not been used for rental or business purposes. If this claim cannot be made, then submit a depreciation worksheet.
If Applicable:
Listing of Sale Expenses
Listing and documentation of Purchase Expenses
Improvements List and Documentation Breakdown should be a detailed list of the improvement by project with the associated cost. This does not include any repairs, maintenance, or personal property. Sales receipts are only requested if there are questions about the scope and cost of an item on the list.
Passive Loss Carryforward Amount and Documentation
Deferred Gain Amount and documentation
Letter explaining or clarifying any unusual issues

Amount of Gain Realized On Sale Is Lower Than Federal Exclusion Amount

No longer available in myVTax.

Federal §121 Exclusion Will Be Claimed

May be requested when the seller used the property as a primary residence for 2 out of the last five years. This is also referred to as the primary residence exclusion:

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Proof of Basis
Signed document from the sellers stating that: They have owned and occupied as a primary residence 2 of the last 5 years They will be taking their once every 2-year federal exclusion They have not taken the federal exclusion in the last 2 years The property has not been used for rental or business purposes. If this claim cannot be made, then submit a depreciation worksheet.
If Applicable:
Listing of Sale Expenses
Listing and documentation of Purchase Expenses
Improvements List and Documentation Breakdown should be a detailed list of the improvement by project with the associated cost. This does not include any repairs, maintenance, or personal property.
Letter explaining or clarifying any unusual issues

Transaction Is Part of A §1031 Exchange Agreement

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Proof of Basis
Depreciation Worksheet
The §1031 exchange agreement
Copy of the purchase and sale for the replacement property, if identified, If the replacement property has not yet been identified, you have the maximum time allowed federally to provide that information to the Department. For a Land Gains Certificate to be issued, the replacement Property must be located in Vermont.
If Applicable:
Listing of Sale Expenses
Listing and documentation of Purchase Expenses
Improvements List and Documentation Breakdown should be a detailed list of the improvement by project with the associated cost. This does not include any repairs, maintenance, or personal property. Sales receipts are only requested if there are questions about the scope and cost of an item on the list.
Passive Loss Carryforward Amount and Documentation
Deferred Gain Amount and Documentation
Letter explaining or clarifying any unusual issues

Some or All Sellers Are Vermont Residents or Domestic Entities

Important note: This is not a primary residence exemption. Use this reason only when the property is being sold by multiple parties - some parties are Vermont residents, and some are nonresidents.

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Attach a signed statement from each Vermont resident seller stating that “they are a Vermont Resident and the percentage of the proceeds they will receive from the sale.” If the seller is a domestic entity, attach a signed statement from the members/shareholders stating that “the entity is a Vermont domestic entity,” and members/shareholders that represent a controlling interest are Vermont residents. a copy of the certificate of organization or incorporation issued by the Vermont Secretary of State.
Letter explaining or clarifying any unusual issues

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Attach a signed statement from each Vermont resident seller stating that “they are a Vermont Resident and the percentage of the proceeds they will receive from the sale.”

If the seller is a domestic entity, attach a

signed statement from the members/shareholders stating that “the entity is a Vermont domestic entity,” and members/shareholders that represent a controlling interest are Vermont residents.
a copy of the certificate of organization or incorporation issued by the Vermont Secretary of State.

Letter explaining or clarifying any unusual issues

Selling Entity Is Tax Exempt

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Proof of Basis
You must attach a copy of the Tax Clearance Certification issued by the IRS
Letter explaining or clarifying any unusual issues

Other Reason Where Gain Is Not Recognized Federally

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Proof of Basis
You must attach a written description of the situation and documentation to substantiate that this situation applies to the transfer of this property.
Letter explaining or clarifying any unusual issues