Vermont Subtractions from Income
Adjustment for Past Bonus Depreciation
Vermont Act 190 of 2008 prevents the bonus depreciation allowed under the Federal Economic Stimulus Act of 2008 from flowing through to the Vermont individual income tax return. The disallowance affects individuals filing Federal schedules for business income and those who receive business income passed through by partnerships, limited liability companies and S corporations, and beneficiaries of estates and trusts. Enter the difference between the depreciation calculated by standard MACRS methods and the depreciation calculated at the Federal level. See VT Technical Bulletin 44 for more information on how to calculate VT allowable depreciation.
Enter the amount of VT exempt military pay received in 2011 that is included in your Federal adjusted gross income. Exempt military pay is:
- Wages earned from the armed services for full-time active duty outside of VT.
Supporting Documents Required: Copy of active duty orders.
- Up to $2,000 for National Guard or U.S. Reserve training pay earned in VT if your adjusted gross income for tax year 2011 is less than $50,000.
Supporting Documents Required: Copy of DFAS form or certification statement from unit that all training was completed during the calendar year.
- Student loan repayment can be taken only if the amount is included in your adjusted gross income. Enter the repayment benefit made under 10 U.S.C. Chapters 109 and 1609 for 2011 year.
Supporting Documents Required: Certification statement from armed services showing your name, address, social security number, amount of student loan repayment, and payment date.
Deployed members of the National Guard or U.S. Reserve may be eligible for exemption of both full-time military pay and monthly training. Persons assigned by their employer to work on a military project are not members of the armed services.
Federal Employment Opportunity Credit
Enter the amount of wages or expense required to be added back to Federal AGI under IRC Sections 280C or 44.
IRS Section 280C(a) No deduction shall be allowed for that portion of the wages or salaries paid or incurred for the taxable year which is equal to the sum of the credits determined for the taxable year under sections 45A(a), 51(a), and and (FOOTNOTE 1) 1396(a), 1400P(b), and 1400R. In the case of a corporation which is a member of a controlled group of corporations (within the meaning of section 52(a)) or a trade or business which is treated as being under common control with other trades or businesses (within the meaning of section 52(b)), this subsection shall be applied under rules prescribed by the Secretary similar to the rules applicable under subsections (a) and (b) of section 52.
Railroad Retirement Income
Enter the amount you received in 2011 for Regular Railroad Retirement Benefits (Tier 1) and Supplemental Railroad Annuity Payments (Tier 2). This income is taxable at the Federal level, but exempt from VT income tax. If you receive social security that includes Tier 1 or Tier 2 benefits, enter only the portion included in your Federal adjusted gross income.
Supporting Documents Required: Copy of 1099, 1099RB, WP-4 or any other document you received showing payment of these benefits.
VT State Payment for Disabled Person(s)
Enter the amount paid by the State of VT to a family for the support of an eligible person with a developmental disability, as defined in 18 V.S.A. §8722(2). This exclusion does not apply to income of caretakers or contractors hired by the family or guardian of the person with a developmental disability, even if the payment comes directly from the State. Note: This amount may be excluded only if the payment is included in your adjusted gross income.
Americans with Disabilities Credit
Enter the amount or the portion eligible for business expenses made to comply with the Americans with Disabilities Act under Internal Revenue Code §44 for a business located in VT. Supporting Documents Required: A copy of Federal Form
VT Telecommunication Authority Bond/Note Interest
Enter the amount of interest or income you received from a bond or note of:
- VT Telecommunications Authority;
- VT Student Assistance Corporation (VASC); OR
- VT Build America bonds is exempt from VT income tax to the extent the interest or income is included in Federal Adjusted Gross Income (AGI).
Enter the amount interest or income from these sources that is also included in your Federal AGI.
VT-Based Business Solar Energy Investment Credit
For tax year 2011, VT allows 100% of the Federal credit, with certain restrictions, for a VT based business solar energy investment. Note: for VT based business solar energy investment made on or after October 1, 2009, the credit limited to project costs not covered by grants or similar funding from any public or private program that assists in providing capital investment for a renewable energy project. For credits initially claimed for 2011, a certificate from the Clean Energy Development board must be submitted with your return.
Unused VT-based business solar energy investment tax credit may be carried forward no more than five years following the year the credit is claimed (retroactive to credit claim in tax year 2008). See Technical Bulletin 45 for more information.
Investment Tax Credit - VT based only
This credit is limited to the amount of investment tax credit attributable to the VT-property portion. This includes 24% of the VT-based business solar energy investment.