On May 21, 2025, Vermont Governor Phil Scott signed S.51 into law, a tax relief package designed to provide $13.5 million in benefits. This legislation targets low-income workers, families, veterans, and retirees.
Key provisions include a full exemption from state income taxes for military pensions and survivor benefits for households with adjusted gross incomes under $125,000. A $250 refundable tax credit is available for low-income veterans, and the child tax credit now includes families with children up to age 6.
The Earned Income Tax Credit (EITC) is expanded to benefit childless workers, and the income thresholds for partial Social Security exemptions are increased. These changes are effective retroactively for the 2025 tax year.