Closing Costs in Vermont 2026: Buyer & Seller Guide

Vermont bills its property transfer tax to the buyer unless the contract says otherwise. A home you will live in pays 0.5% on the first $200,000 and 1.25% above, plus a 0.22% clean water surcharge on the upper part. A year-round second home not rented long-term pays 3.4%.

The transfer tax: 0.5% up to $200,000 if you will live there

32 V.S.A. § 9602 taxes deeds to property located in the state at 1.25% of value. For property “to be used for the principal residence of the transferee,” § 9602(1) cuts the rate to 0.5% on the first $200,000. That band was $100,000 until Act 181 of 2024 raised it, effective August 1, 2024.

“Value” is the full price, including any lien left on the property after the sale (§ 9601(6)). You are a principal-residence buyer if the home “will be occupied as the domicile of the purchaser” within one year of the sale; a building of up to four units counts if you will live in one of them (§ 10002a).

Section 9604 settles the payer in one sentence: the tax “is the liability of the transferee of the title, unless fixed otherwise by agreement of the parties.” Check the tax clause in your purchase contract. The return goes to the town clerk with the deed, and the tax is due to the Commissioner of Taxes within 30 days after the transfer (§ 9605(a)).

Section 9603 lists 28 exempt transfers. For a household the common ones are gifts between spouses, parents and children, or grandparents and grandchildren “without actual consideration” (item 5), a deed to the lender in foreclosure or in lieu of it (item 18), a divorce judgment dividing the couple’s real estate (item 19), and a new ENERGY STAR or Zero Energy Ready mobile home (item 28).

The 0.22% clean water surcharge no longer has an end date

Section 9602a adds 0.22% on every taxable transfer, skipping the first $200,000 of a principal residence. Act 181 raised it from 0.2% on June 17, 2024. Act 85 of 2017 had scheduled a cut to 0.04% on July 1, 2027 and a repeal in 2039; Act 37 of 2025, effective July 1, 2025, repealed both. The Department of Taxes quotes “total 1.47%” on a home’s price above $200,000.

Ski condos and camps: when the 3.4% rate applies

Since August 1, 2024, § 9602(4) has charged 3.4% on residential property “fit for habitation on a year-round basis” that will not be the buyer’s principal residence and for which the buyer will not have to file a landlord certificate under § 6069. The Department of Taxes treats insulation or weatherization, a heating system, plumbing and running water as evidence of year-round habitability, and says short-term rental use does not escape the higher rate. A camp not fit for year-round habitation, open land and unfinished construction pay 1.25%.

A long-term rental pays the general rate if it is rented within one year of closing and the landlord certificate is filed by January 31 of the next year, per the department. Act 164 of 2026, signed June 18, 2026, added § 9602(5): if the landlord certificate covers a rental with no “bona fide landlord-tenant relationship,” the Commissioner must assess the 3.4% rate. In deciding, the Commissioner may weigh whether the tenant is a related party and whether the rent is at market.

VHFA loans: the first $250,000 is untaxed

Under § 9602(1) and § 9602a, neither the tax nor the surcharge applies to the first $250,000 of a principal residence when the mortgage is one the Vermont Housing Finance Agency or USDA Rural Development “has committed to make or purchase,” or is funded in part by a homeland grant through the Vermont Housing and Conservation Trust Fund. The department says USDA guaranteed loans do not qualify; USDA direct loans do. Above $250,000 the price bears 1.47%, so on any price above $250,000 the saving is $1,735 ($1,000 plus $735 on the $200,000–$250,000 band).

VHFA’s homebuyer page, read September 24, 2026, offers ASSIST: “Up to $10,000 loan for down payment and closing assistance,” a “0% deferred loan with no monthly payments,” repaid at sale, refinance or payoff. It comes only with VHFA MOVE, not with a VA loan, and every borrower and non-borrowing spouse must never have owned a home and hold under $20,000 in combined liquid assets. VHFA loans are made through participating lenders; start with pre-approval and the down payment calculator.

Recording at the town clerk: $15 a page

Clerk fees come from 32 V.S.A. § 1671, which applies “unless otherwise provided by law.” Recording costs $15.00 per page and filing the property transfer return $15.00 (§ 1671(a)(6)); the mortgage is a separate document at the same page rate. Each clerk must post the schedule in the office (§ 1671(b)).

What the buyer holds back from the seller

If the seller is not a Vermont resident, 32 V.S.A. § 5847 makes the buyer hold back 2.5% of the price and send it to the Commissioner within 30 days, on pain of personal liability. No withholding is due if the seller certifies Vermont residency under penalty of perjury, if the Commissioner certifies that no tax is due or the liability is secured, or in a foreclosure or deed in lieu with no extra consideration. Estates are not nonresidents under the section.

The seller’s land gains tax (§ 10006(a)) reaches only land the seller bought and subdivided within six years; buildings and up to 10 acres under a principal residence (up to 25 where zoning demands it) are outside it (§ 10002). Where it applies, the buyer withholds 10% unless the seller produces the Commissioner’s certificate (§ 10007).

Title premiums and who may draft the deed

Title insurance falls under the property and casualty rate law, 8 V.S.A. chapter 128, whose § 4682 excludes only life, annuity, health, ocean marine, reinsurance and aircraft lines. Markets are presumed competitive unless the Commissioner finds otherwise (§ 4684); in a competitive market each insurer files its own rates with the Commissioner at least 30 days before they take effect (§ 4688(a)).

In In re Welch, 123 Vt. 180, 185 A.2d 458 (1962), the Vermont Supreme Court held a surveyor who drafted deeds for others and advised them on rights-of-way and forms of ownership guilty of contempt for practicing law. The case concerns drafting and advice, not who runs the closing.

More on Vermont: the state guide, homeowner insurance in Vermont, closing costs by state. Neighbors: New Hampshire, Massachusetts, Maine. Tools: payment calculator, affordability calculator, refinance guide.

Vermont closing questions

Can the seller agree to pay the Vermont transfer tax?

Yes. Section 9604 puts it on the buyer “unless fixed otherwise by agreement of the parties.”

I’m buying a condo near a ski area to rent out by the year. Is it taxed at 3.4%?

No, if it is rented long-term within a year of closing and you file the landlord certificate. Otherwise a unit fit for year-round habitation pays 3.4% plus the 0.22% surcharge on the whole price.

Does refinancing trigger the transfer tax?

No. § 9603(3) exempts transfers “directly to the obligee to secure a debt,” which is what a mortgage deed is. The clerk’s $15-per-page recording fee still applies.

I’ll be living in New York when my Vermont house sells. What happens at closing?

Unless a § 5847 exception applies, the buyer withholds 2.5% of the price. It counts as a payment toward your Vermont income tax on the sale, and the Commissioner must offer an early-refund procedure if you owe less.