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Property Transfer Tax

Property Transfer Tax is a tax on the transfer of title to real property in Vermont. The tax applies to both property transfers by deed and to acquisitions of a controlling interest in an entity with title to a property.

What's New: Tax Rates and Exemptions

Act 181 (H.687) of 2024 made certain changes to the Property Transfer Tax rates and exemptions, as well as the Clean Water Surcharge. See below for the rate schedule starting August 1, 2024.

Effective August 1, 2024, the Property Transfer Tax rates are as follows:

  • General Tax Rate: Remains the same at 1.25%

  • Clean Water Surcharge Rate: Increases from 0.2% to 0.22% and increases exemption amounts

  • Principal Residence Tax Rate: Special tax rate of 0.5% remains the same, but value subject to 0.5% rate (and exempt from the Clean Water Surcharge) increases from the first $100,000 of value paid to the first $200,000 of value paid.  The General Tax Rate of 1.25% plus the Clean Water Surcharge of 0.22% (total 1.47%) applies to the value paid above $200,000. See the FAQs below to learn how principal residence is defined.

  • Non-Principal Residence Tax Rate (for a non-long term rental residence fit for year-round habitation): Increases from 1.25% to 3.40% (3.62% including the Clean Water Surcharge).

  • Exemption 99 (for a principal residence funded in part with a homeland grant through the Vermont Housing & Conservation Board (VHCB) or which the Vermont Housing Finance Agency (VHFA) or USDA Rural Development has committed to make or purchase): Increases exempt amount from the first $110,000 of value paid to the first $250,000 of value paid. The General Tax Rate of 1.25% plus the Clean Water Surcharge of 0.22% (total 1.47%) will apply to the value paid above $250,000.

New Exemptions from the Property Transfer Tax and Clean Water Surcharge:

  • Abandoned Dwellings: blighted real estate owned and acquired by a municipality through condemnation or tax sale.  Buyer must certify at the time of purchase that the dwelling will be rehabilitated and occupied as a principal residence and not as a short-term rental and prove within three years of purchase that rehabilitation of dwelling has been completed and dwelling is occupied as a principal residence.

  • New ENERGY STAR Mobile Homes: new mobile homes as defined in 10 V.S.A. § 6201(1) that have an ENERGY STAR energy efficiency label and that are certified as a Zero Energy Ready Home by the U.S.  Department of Energy.

Form Changes

New: The 2024 legislative session changes will be reflected on the revised Property Transfer Tax Return (PTT-172 and associated instructions), which is scheduled to be available by August 1, 2024.

How to File

There are two ways to file your return when the transfer is by deed:

Online: Electronically file through myVTax.

Paper Return: Tax preparers who file more than five returns or certificate requests per calendar year are required to use myVTax for filing. If you file fewer than five returns, you can order forms online or by contacting us at (802) 828-2515.

How to Make a Payment

Tax is due within 30 days of the closing date.

Online: You may pay electronically at myVTax.

By Mail: Please make checks payable to the Vermont Department of Taxes and complete Form PTT-173, Property Transfer Payment Voucher. Mail your payment and voucher to:

Vermont Department of Taxes
133 State Street
Montpelier, VT 05633-1401

How to File and Pay Controlling Interest

To report the transfer or acquisition of a direct or indirect controlling interest in any person with title to property please file Form PTT-182, Property Transfer Controlling using myVTax. Tax is due within 30 days of the transfer. You may pay electronically with myVTax, or by check. Please make checks payable to the Vermont Department of Taxes and complete Form PTT-173, Property Transfer Payment Voucher.

If you have questions or if you need assistance filing returns, please contact the Department at (802) 828-6851 or tax.rett@vermont.gov.

Property Transfer Tax Forms and Guidance

New: The 2024 legislative session changes will be reflected on the revised Property Transfer Tax Return (PTT-172 and associated instructions), which is scheduled to be available by August 1, 2024.

myVTax Instructions

Title Number Revised
myVTax Guide: How to Login and File a Property Transfer Tax Return GB-1130 2020
myVTax Guide: How to Record Returns for Town Clerks GB-1216 2021
myVTax Guide: How to Search for Property Transfer Tax Returns for Listers and Assessors GB-1150 2020

Tax Forms and Instructions

Form Number Instructions Title Revised
PTT-172 Instructions Vermont Property Transfer Tax Return 2023
PTT-172 Guide Included PTT-172 Quick Reference Guide 2019
PTT-173 Instructions Property Transfer Payment Voucher 2020
PTT-175 Included with form Additional Transferors And Transferees 2020
PTT-182 Instructions Property Transfer Controlling Interest 2020
RW-171 Included with form Vermont Withholding Tax Return for Transfer of Real Property 2014

Fact Sheets and Guidance

Title Number Revised
Property Transfer Tax Return (PT-172): Forms Acceptable to File with Vermont Towns  FS-1042 2023
Town Clerks: When to Mail Paper Versions of the Property Transfer Tax Return to the State FS-1137 2024
Vermont Taxation on Transfers of Mobile Homes FS-1275 2024

Property Transfer Tax Statistics

Type Frequency
Weekly Property Transfer Tax Data Weekly
Quarterly Property Transfer Tax Reports Quarterly
Calendar Year Property Transfer Tax Reports Annually

For Town Clerks

The following forms are acceptable to record:

Date of Closing Form Number
Prior to June 1, 2015 PT-172, PT-172-S, PT-172-B (Order paper forms)
June 1, 2015 to December 31, 2015 PTT-172, Vermont Property Transfer Tax Return (rev 6/17)
2016 PTT-172, Vermont Property Transfer Tax Return (rev 6/17)
2017 PTT-172, Vermont Property Transfer Tax Return (rev 6/17)
2018 PTT-172, Vermont Property Transfer Tax Return (rev 6/17)
2019 PTT-172, Vermont Property Transfer Tax Return (rev 8/22)
2020 PTT-172, Vermont Property Transfer Tax Return (rev 8/22)
2021 PTT-172, Vermont Property Transfer Tax Return (rev 8/22)
2024 PTT-172, Vermont Property Transfer Tax Return (rev 8/24)

Rate Schedule Starting August 1, 2024

General Tax Rate:  1.25%

Non-Principal Residence Tax Rate:  3.4%

Clean Water Surcharge:  0.22%

Special Circumstances:

  • Principal Residence Tax Rate

    • 0.5% on the first $200,000 of value paid

    • 1.47% on the balance of value paid above $200,000 (includes both General Tax Rate pf 1.25% and Clean Water Surcharge of 0.22%)

    • See the FAQs below to learn how principal residence is defined

  • Non-Principal Residence Tax Rate (for a non-long-term-rental residence for year-round habitation)

    • 3.62% (includes both the Non-Principal Residence Tax Rate of 3.40$ and the Clean Water Surcharge of 0.22%)

  • Exemption 99 Tax Rate (for a principal residence funded in part with a homeland grant through the Vermont Housing & Conservation Board (VHCB) or with the Vermont Housing Finance Agency (VHFA) or the U.S. Department of Agriculture and Rural Development has committed to make or purchase):

    • 0% on the first $250,000 of value paid

    • 1.47% on the balance of value paid above $250,000 (includes both the General Rax Rate of 1.25% and Clean Water Surcharge of 0.22%

Type of Property Value Taxed 0.5% Property Transfer Tax Applies 1.25% Property
Transfer Tax Applies
0.22% Clean Water Surcharge Applies 3.4% Property Transfer Tax Applies
Not Principal Residence fit for year-round habitation and not rented long term All No Yes Yes Yes
Not Principal Residence either not fit for year-round habitation or that is not rented long term All No Yes Yes No
Principal Residence $0 - $200,000 Yes No No No
Principal Residence Marginal Value > $200,000 No Yes Yes No
Principal Residence purchased with VHFA, CVTF, or USDA assistance $0 - $250,000 No No No No
Principal Residence purchased with VHFA, CVTF, or USDA assistance Marginal Value > $250,000 No Yes Yes No
Housing Cooperative to be used as principal residences of all members or shareholders $0 - $200,000 Yes No No No
Housing Cooperative to be used as principal residences of all members or shareholders Marginal Value > $200,000 No Yes Yes No

Frequently Asked Questions

When Should You File a Property Transfer Tax Return?

Transfer by Deed:

A Property Transfer Tax Return must be filed with a town clerk whenever a deed(s) transferring title to real property is delivered to a town clerk for recording. A town clerk cannot record any deed unless it is accompanied by a completed Property Transfer Tax Return.

Transfer by Acquisition of Controlling Interest:

A Property Transfer Tax Return must be filed directly with the Department of Taxes within 30 days after the transfer or acquisition. To report the transfer or acquisition of a direct or indirect controlling interest in any person with title to property please file Form PTT-182, Property Transfer Controlling Interest using myVTax. If you have questions, please contact the Department at (802) 828-6851 or tax.rett@vermont.gov.

What is a “Controlling Interest?”

For Corporations:

  1. 50 percent or more of the total combined voting power of all classes of stock of the corporation, or
  2. 50 percent or more of the capital of the corporation, or
  3. 50 percent or more of the profits of the corporation, or
  4. 50 percent or more of the beneficial interest in voting stock of the corporation.

For Partnerships, LLCs, Associations, Trusts, and Other Entities:

  1. 50 percent or more of the capital of the entity, or
  2. 50 percent or more of the profits of the entity, or
  3. 50 percent or more of the beneficial interest in the entity.

What is a "Principal Residence?"

"Principal residence" means a dwelling that, within one year from the date of transfer, will be occupied as the purchaser’s domicile, together with land that is beneath or directly contiguous to the dwelling and that is transferred with the dwelling. A domicile is a person’s principal dwelling. Principal residence includes any multi-family dwelling up to four units, if the purchaser will use at least one unit within the dwelling as their principal residence within one year from the date of transfer.

Principal residence” also means any dwelling that will be used by the purchaser as their principal residence within one year from the date of transfer, even though the purchaser also carries on or will carry on commercial activity in that dwelling. Commercial activity includes an office for the purchaser’s business or profession or a retail store. See 32 V.S.A. §§ 9601(11), 10002(b), and 10002a.

What Types of Non-Principal Residences are Taxed at a Higher Rate?

A property transfer will be subject to the Property Transfer Tax rate of 3.4% and Clean Water Surcharge of 0.22% for a total tax rate of 3.62% in the following circumstances:

  • The property is of a type considered to be residential property; and

  • The property is fit for year-round habitation; and either:

    • The property will not be used as the buyer's principal residence, or

    • The property will not be used as a long-term rental that requires the filing of a Landlord Certificate

See 32 V.S.A. § 9602(4); Act 181 of 2024, Sec. 73.

Is a Transfer of a Licensed Lodging Establishment or a Multi-Dwelling Building with Five or More Units Taxed at the Non-Principal Residence Tax Rate? 

No, a licensed lodging establishment or a multi-dwelling building with five or more units is not considered residential property.  These types of properties are considered commercial properties used for business purposes.  Accordingly, transfers of these types of properties are taxed at the general Property Transfer Tax rate of 1.25% and not at the non-principal residence Property Transfer Tax rate of 3.4%.

Is a Transfer of Open Land or Unfinished Construction Taxed at the Non-Principal Residence Rate?

No, open land or unfinished construction is not considered a residential property fit for year-round habitation at the time of transfer.  Evidence of habitability includes insulation or weatherization, heating system, plumbing, and running water.  Accordingly, transfers of these types of properties are taxed at the general Property Transfer Tax rate of 1.25% and not at the non-principal residence Property Transfer Tax rate of 3.4%.

What is the Landlord Certificate and When Does it Have to be Filed?

Annually on or before January 31, landlords are required to submit a Landlord Certificate to the Department of Taxes for any property that has been used as a rental for periods of 30 or more consecutive days, with or without a lease.  See 32 V.S.A. § 6069.

To show that the non-principal residence Property Transfer Tax rate of 3.4% does not apply to a transfer because it will be used as a long-term rental, the buyer must file a Landlord Certificate with the Department of Taxes within one year of the transfer.

Example:

On October 31, 2024, a buyer purchases a non-principal residence fit for year-round habitation that the buyer intends to rent to long-term tenants.  The buyer selects the general tax rate on the Property Transfer Tax return, attesting that the property will be used as a long-term rental, and does not pay the 3.4% non-principal residence Property Transfer Tax rate.

The buyer makes repairs to the dwelling that are not finished before the end of 2024, and so cannot rent the property.  There are no rental periods in 2024 to report, so the buyer does not file a Landlord Certificate on or before Jan. 31, 2025.

The buyer signs a lease with a tenant on August 1, 2025, and rents the property for the rest of the year. The buyer is required to file a Landlord Certificate for their rental property for the 2025 calendar year.  The buyer can file a Landlord Certificate for the rental periods in 2025 up until January 31, 2026.  If the buyer does not file a Landlord Certificate on or before January 31, 2026, then the Department can take measures up to and including requiring payment of the 3.4% non-principal residence Property Transfer Tax.

For more information on Landlord Certificates, see, https://tax.vermont.gov/property/landlord-certificates.

What Types of Mortgages are not Taxed on the Full Value?

The Property Transfer Tax and the Clean Water Surcharge do not apply to the first $250,000 of value paid when the buyer obtains a mortgage loan that is either:

  1. Made by the U.S. Department of Agriculture and Rural Development, or
  2. Purchased by the Vermont Housing and Finance Agency

USDA Rural Development Direct Home Loans are not taxed on the first $250,000 in value because they are mortgages that USDA Rural Development has committed to make to the borrower.

USDA Rural Development Guaranteed Loans are taxable. USDA does not commit to make or purchase these types of mortgages. Instead, USDA guarantees a loan that is provided by a financial institution. USDA will pay the lender if the borrower defaults, but the borrower must then repay the USDA. This arrangement is neither a commitment to make a mortgage or a commitment to purchase a mortgage.

Vermont Housing and Finance Agency purchased mortgages are exempt for the first $250,000 in value because they are mortgages that VHFA has committed to purchase from the originating lender.

How are Lands Enrolled in the State Use Value Appraisal Program (Current Use) Taxed?

There is no special Property Transfer Tax treatment for properties in Current Use.  See below for the historical rates applied to certain agricultural lands:

  • 0.5% for properties transferred before July 1, 2011

  • 1.225% for properties transferred on or after July 1, 2011, and before June 16, 2015

  • 1.45% for properties transferred on or after June 16, 2015, and before August 1, 2024

  • 1.47% for properties transferred on or after August 1, 2024

Who is Liable for the Tax?

When a transfer is made by deed, the buyer or transferee is liable for the transfer tax.

When acquiring a controlling interest in an entity that holds title to property, the person making the acquisition is liable. All persons acting in concert to acquire a controlling interest are individually liable but should file only one return representing their combined acquisition of the controlling interest.

Property and Real Estate Transaction Tax Forms and Instructions

New: The 2024 legislative session changes will be reflected on the revised Property Transfer Tax Return (PTT-172 and associated instructions), which is scheduled to be available by August 1, 2024.

Property and Real Estate Transaction Tax Forms and Instructions

Number Instructions Title
Commissioner's Certificate  

All certificate requests must be requested through myVTax

How to request a Commissioner's Certificate

HSD-315   Request For Lister’s Certificate of Housesite Value (Formerly Form PVR-315)
HSD-316   Request For Lister’s Certificate of Housesite Value For A Subdivided Parcel (Formerly Form PVR-316)
LGT-174   Land Gains Installment Payment Voucher
LGT-177

Instructions

Vermont Land Gains Withholding Tax Return To Be Completed By Buyer (Transferee)
LGT-178 Instructions Vermont Land Gains Tax Return To Be Completed By Seller (Transferor)
LGT-179 Instructions Vermont Land Gains Schedules
LGT-181 Instructions

Land Gains Basis Calculation Foreclosure Property

PTT-172 Instructions

Vermont Property Transfer Tax Return

PTT-173  Instructions Property Transfer Payment Voucher
PTT-175   

Additional Transferors And Transferees

PTT-182 Instructions

Property Transfer Controlling Interest

RW-171   Vermont Withholding Tax Return for Transfer of Real Property