Combined rate and how to defer it in Vermont.
Vermont's top income tax rate on capital gains of 8.75% brings the combined investment property figure to 32.5% (20% federal + 3.8% NIIT + 8.75% state), one of the higher combined rates in New England.
Vermont taxes capital gains as ordinary income at up to 8.75% at the state level. Combined with federal, the total reaches 32.5%. Estimate the full bill with depreciation recapture using the capital gains tax calculator.
A 1031 like-kind exchange can defer the combined 32.5% rate by rolling all proceeds into a qualifying replacement property. Model it in the 1031 exchange calculator and track your deadlines with the timeline calculator.