Renter Credit

The name of the tax credit has changed from “Renter Rebate” to “Renter Credit.”

You still must live in Vermont the whole year to get the credit, but you don’t have to rent for all twelve months anymore. The new credit is available to anyone who rented at least six months, and the six months don’t need to be consecutive. If you rented for less than the full year, the credit will be scaled based on the number of months you rented. For example, renting for nine months would entitle you to 75% of the full year credit amount.

Under the old Renter Rebate program, only one claim was allowed per rental unit. This meant that unrelated renters had to share personal income information with each other. That’s not the case anymore. Under the new credit, non-married adults who live together can each claim the credit independently but the credit that each of them will receive will be scaled down by 50% to reflect that they are in a shared living situation. Non-married adults who live together will no longer have to share personal income information with others in their rental unit and will not have to split up or share the credit they receive.

There won’t be a separate household income form anymore. Instead, claimants will complete a shorter and simpler income section on the credit application.

The income limits for the program are much different than they used to be. Previously, the income limit was $47,000 regardless of your family size or where you lived. The new limits are 50% of the county median income by family size as determined by the Department of Housing and Urban Development (HUD). The income limits in the new program will grow each year with inflation while the old income limit of $47,000 hadn’t changed for twenty years.

The old program had what are known as “cliffs” in the calculation – places where your credit would drastically change if your income was just one dollar more. The new program does not. If you are under HUD’s extremely low-income limit (25% of median income) based on county and family size you get the full credit amount, and there’s a smooth credit phaseout between that income level and the eligibility limit.

The credit amount in the new program is 10% of the fair market rent for an apartment of your family size in your county. For example, if you are two people living in Middlebury, you will get a credit based on a two-bedroom apartment in Addison County, which HUD calculates as $12,700 per year, generating a credit of $1,270.

Yes, the Tax Department has created a calculator that will let you estimate the amount of your credit.

Use the Calculator to Estimate your Renter Credit (xlsx).

No, you don’t need to ask your landlord for a certificate. Your landlord will submit a certificate directly to the Tax Department containing all the necessary information for each building and unit they own (i.e., the address of each building as well as the names of renters and their unit number).

Yes, the Renter Credit Application will ask you to include the correct SPAN. The Tax Department will provide a tool to help you find the correct SPAN for your address.

For renters who receive subsidies, your credit will be based on actual rent paid. Your landlord will submit information to the Department and the Department will calculate your credit for you. Housing aid received through programs from the CARES Act or the American Rescue Plan Act are considered subsidies for this program.