Vermont Statutes Title 32 Sec. 5847
Terms Used In Vermont Statutes Title 32 Sec. 5847
- Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
- Commissioner: means the Commissioner of Taxes appointed under section 3101 of this title or any officer or employee of the Department authorized by the Commissioner (directly or indirectly by one or more redelegations of authority) to perform the functions mentioned or described in this chapter. See
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Corporation: means any business entity subject to income taxation as a corporation, and any entity qualified as a small business corporation, under the laws of the United States, with the exception of the following entities that are exempt from taxation under this chapter:
- Department: means the Vermont Department of Taxes. See
- Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
- Individual: means a natural person. See
- Mortgagee: The person to whom property is mortgaged and who has loaned the money.
- Mortgagor: The person who pledges property to a creditor as collateral for a loan and who receives the money.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Person: shall include an individual, firm, partnership, association, joint stock company, corporation, trust, estate, or other entity. See
- real estate: shall include lands, tenements, and hereditaments and all rights thereto and interests therein, and pews or slips in places of public worship shall be treated as real estate. See
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- Refund: means any individual's State income tax refund under chapter 151 of this title and any payment due a claimant under chapter 154 of this title. See
- State: when applied to the different parts of the United States may apply to the District of Columbia and any territory and the Commonwealth of Puerto Rico. See
- tax liability: includes the liability for all amounts owing by a taxpayer to the State of Vermont under this chapter. See
§ 5847. Withholding on sales or exchanges of real estate
(a) Except as otherwise provided in this section, in the case of any sale or exchange of real property located in Vermont by a nonresident of Vermont, the transferee shall be required to withhold and transmit to the Commissioner within 30 days of such sale or transfer, a withholding tax equal to 2 1/2 percent of the consideration paid for the transfer. Any transferee who fails to withhold such amount shall be personally liable for the amount of such tax.
(b) Subject to subsection (d) of this section, no person shall be required to withhold any amount under subsection (a) of this section if:
(1) the transferor furnishes to the transferee a certificate by the transferor stating, under penalty of perjury, the transferor’s Social Security number and the fact that the transferor is a Vermont resident; or
(2) the transferor or transferee has received a certificate from the Commissioner stating that:
(A) no tax is due on the gain from that transfer; or
(B) the transferor or transferee has satisfied the transferor’s tax liability or has provided adequate security to cover such liability; or
(3) the transferor is a mortgagor conveying the mortgaged property to a mortgagee in foreclosure, or in a transfer in lieu of foreclosure, with no additional consideration.
(c) At the request of the transferor or transferee, the Commissioner may issue the certificate referred to in subdivision (b)(2) of this section or a certificate prescribing a reduced amount to be withheld under this section if the Commissioner determines that such reduced amount will not jeopardize the collection of the tax imposed by this chapter and the transferor is in good standing with the Department of Taxes with respect to any and all taxes. For purposes of this section, a transferor is in good standing with respect to any and all taxes if:
(1) all returns due from the transferor for any and all taxes have been filed; and
(2) no taxes are due and payable, except those on appeal.
(d) If a transferee has actual knowledge that a certificate furnished under subsection (b) of this section is false and the transferee fails to withhold the prescribed amount, the transferee shall be liable for an amount equal to the amount that should have been withheld together with penalty and interest as provided by this title.
(e) As used in this section “nonresident” of Vermont shall include individuals, trusts, partnerships, and corporations, but not estates. A nonresident individual is an individual who is domiciled outside Vermont at the time of closing. A nonresident trust is a trust that, at the time of closing, does not qualify for Vermont residency as defined in subdivision 5811(11) of this title. A nonresident partnership is a partnership, the controlling interest in which is held by nonresidents. A nonresident corporation, other than a Subchapter S corporation, is a corporation that is incorporated outside Vermont other than a corporation that has its principal place of business in Vermont and does no business in its state of incorporation. A nonresident Subchapter S corporation is a Subchapter S corporation the controlling interest in which is held by nonresidents. A nonresident limited liability company is a limited liability company the controlling interest in which is held by nonresidents.
(f) The amount withheld pursuant to this section shall be deemed to be a payment against the tax imposed by this chapter on income received by the seller.
(g) The Commissioner shall, by rule, establish a procedure by which a seller may apply for an early refund of the tax withheld when the seller establishes that no tax under this chapter will be owed or that a tax less than the amount withheld will be owed. The Commissioner shall, by rule, establish methods by which nonresident transferors may provide security in lieu of withholding.
(h) In the case of an installment sale, the seller may elect for Vermont purposes to report the entire gain in the year of the sale and to pay a tax equal to six percent of that gain. If the seller does not make this election, the real estate withholding will be retained by the Department and applied as a credit against the seller’s tax liability in each year that an installment is received. (Added 1989, No. 93; amended 1989, No. 222 (Adj. Sess.), § 9, eff. May 31, 1990; 1991, No. 67, § 26a, eff. June 19, 1991; 1995, No. 29, § 41, eff. April 14, 1995; 1997, No. 50, § 18, eff. June 26, 1997; 2021, No. 105 (Adj. Sess.), § 536, eff. July 1, 2022.)