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Vermont · 32 V.S.A. §5847Vermont nonresident seller withholding: 2.5% within 30 days

When a nonresident of Vermont sells Vermont real property, the buyer must withhold 2.5% of the consideration and send it to the Commissioner of Taxes within 30 days (32 V.S.A. §5847). A buyer who fails to withhold is personally liable. No withholding when the seller certifies Vermont residency and Social Security number under penalty of perjury, when the Commissioner certifies no tax is due or the liability is secured, or in a foreclosure or deed in lieu. The Commissioner may also certify a reduced amount. Nonresidents include individuals, trusts, partnerships and corporations, but not estates. On a $500,000 sale: $12,500.

Who withholds, how much and an example

  1. Who withholds

    The transferee – the buyer (§5847(a)).

  2. Amount and deadline

    2.5% of the consideration, sent within 30 days of the sale (§5847(a)).

  3. Liability

    A buyer who fails to withhold is personally liable; a buyer who knows a certificate is false is liable too (§5847(a), (d)).

  4. Reduced amount

    The Commissioner may certify a lower amount if the seller is in good standing (§5847(c)).

  5. Example

    $500,000 sale from a nonresident → $12,500.

No withholding when

  • The seller certifies Vermont residency and its Social Security number under penalty of perjury (§5847(b)(1)).
  • A Commissioner's certificate that no tax is due or the liability is satisfied or secured (§5847(b)(2)).
  • Foreclosure or a transfer in lieu of foreclosure with no additional consideration (§5847(b)(3)).
  • The seller is an estate – estates are not nonresidents under §5847(e).

What the TC checks before closing

  • Seller's residency and entity type – asked early, not at the closing table.
  • The signed exemption certificate or affidavit, in the file before funds are disbursed.
  • The withholding line on the seller's settlement statement and who remits it, and by when.

Questions about this withholding

How much is Vermont withholding on a nonresident sale?

2.5% of the consideration – $12,500 on $500,000 – sent within 30 days.

Does Vermont withholding apply to estates?

No. §5847(e) excludes estates from the definition of nonresident.

Can a nonresident reduce Vermont withholding?

Yes, by asking the Commissioner for a certificate of no tax due or a reduced amount (§5847(c)).

Related guides

Put the residency question and the exemption certificate on the checklist as tasks with an owner and due date in ClosingCode, with the documents attached to the deal.

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Source: 32 V.S.A. §5847 (legislature.vermont.gov, read October 25, 2026).

General information, not legal or tax advice. ClosingCode is software; it is not a law firm or brokerage.