VT Department of Tax Compliance & News Tips for Businesses and Nonprofits

The Agency of Administration Department of taxes knows that tax law presents a learning curve for businesses. To make it easier for operators to understand the law, the Audit division has started a campaign to educate businesses about common tax errors before they happen. This approach saves money and time for both businesses and the State. Throughout this campaign, Audit will be reaching out to different business sectors to provide guidance directly related to their work, and when applicable, point them to specific materials on the Department’s website.


The Compliance Division’s work contributes to the mission of the Department of Taxes by informing and educating taxpayers about complex tax laws, selecting, and conducting audits, and collecting unpaid taxes.

The primary goal is to encourage “voluntary compliance” – that is to enable Vermont taxpayers to accurately determine what taxes they are liable for and pay the correct amount on their own. Another goal is to provide a level playing field for Vermont taxpayers by making sure that everyone is paying their fair share, in accordance with the current law.

With tax laws being complex, it can lead to honest mistakes and there are people and businesses who under report taxes or do not file tax returns at all. To make sure people are reporting and paying the correct amount o tax to bring them to compliance, the department is looking to educational outreach.

News and Tips

Here are a few news items and tips. For a complete list, please visit The Agency of Administration Department of Taxes: Tax Law and Guidance.

File Returns Even When Zero is Owed
Businesses with open tax accounts are reminded to file a return even when no tax is owed. If you are closing a business, see Close a Business to see what you need to do.

Reminder to Nonprofit Organizations
Use of Form S-3, Vermont Sales Tax Exemption Certificate for Purchases for Resale and by Exempt Organizations, is for the use of 501(c)(3) organizations. Civic, social, recreational, and business league organizations that are not IRS-designated 501(c)(3) organizations are not eligible for sales tax exemptions and therefore cannot make exempt purchases. To qualify for Form S-3, a nonprofit must be organized and operated for charitable purposes, as defined in section 501 of the Internal Revenue Code. Please see covering purchases by nonprofits.

Household Members Income – Homestead
Do you have household members with income? Remember that the first $6,500 of income earned by a full-time student who qualifies as your dependent is not considered to be part of your household income. Learn more about how to determine your household income.

For a complete list of news and tips, please click here.

With offices in Williston and Rutland Vermont, Davis & Hodgdon Advisory Group has served business owners and individuals for more than 30 years by providing progressive, proactive tax and business services through expert staff, high-end technology, and unparalleled efficiency. Contact us today.

Resource: The Agency of Administration Department of Taxes: Tax Law and Guidance

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