Updated January 2026
Vermont Veteran Benefits 2026
Vermont offers several benefits for veterans and military retirees. Here is a summary of the key tax and property benefits available in VT for 2026.
Vermont Highlights
- Full military retirement exemption (AGI-conditioned)
- Local property tax exemptions for veterans
- Free state park access for disabled veterans
- Vermont Veterans Home
Income Tax Treatment
Vermont has a state income tax.
Military Retirement Pay: Starting with the 2025 tax year, Vermont fully exempts military retirement pay for retirees with federal AGI of $125,000 or less, phasing out between $125,000 and $175,000.
Active Duty Pay: Active duty pay earned outside Vermont may be exempt.
VA Disability Compensation: VA disability compensation is tax-free at both the federal and state level in all 50 states. Vermont does not tax VA disability payments.
Property Tax Exemption for Disabled Veterans in Vermont
Type: Varies by city/county
Vermont sets a state MINIMUM disabled-veteran property-tax exemption of $10,000 of appraised value (applied to both the municipal and the statewide education grand lists). A town MAY vote (majority at an annual/special meeting) to increase the MUNICIPAL portion of the exemption up to $40,000 of appraised value. Eligibility requires the veteran (or qualifying family member) to be receiving VA disability compensation for at least 50% disability, OR death compensation / dependency and indemnity compensation (DIC), OR a non-service-connected VA disability pension. Administered via the Vermont Office of Veterans Affairs.
| VA disability rating / category | What you get |
|---|---|
| At least 50% VA disability (or receiving death compensation, DIC, or a VA disability pension) | Minimum $10,000 of appraised value exempt statewide; town may vote to increase the municipal-grand-list portion up to $40,000 of appraised value.Must be a Vermont resident with the property as the primary residence/homestead. Apply through the Vermont Office of Veterans Affairs by May 1 of the first year sought; exemption then remains until the property title transfers. The increase above $10,000 (up to $40,000) applies only to the municipal grand list and only if the town has voted for it. |
- Income limit: None
- Age requirement: None
- Surviving spouse: An unremarried widow or widower of a previously qualified veteran is entitled to the exemption WHETHER OR NOT the survivor is receiving government compensation or pension. A child of a qualifying disabled veteran may also be a qualifying family member under the statute.
- Counts being paid at 100% via unemployability (TDIU)? Yes — being paid at the 100% rate via Individual Unemployability (TDIU) qualifies
Source: 32 V.S.A. 3802(11) and a second official source. Verified June 2026 against primary sources.
To apply, contact your county assessor's office or the Vermont Department of Veterans Affairs. You will typically need your VA disability rating letter (and often your DD‑214) and proof that the home is your primary residence.
Real estate vs. personal property: this benefit applies to real-estate (home/homestead) property tax. Personal-property taxes — such as the annual tax some states levy on vehicles — are separate and generally still apply, even at a 100% rating, unless your state specifically exempts them.
VA Healthcare in Vermont
Vermont has approximately 1 VA medical center along with community-based outpatient clinics (CBOCs) throughout the state. Veterans enrolled in VA healthcare can receive care at any VA facility nationwide.
To find the nearest VA facility, visit VA.gov Facility Locator.