Vermont Tax Changes 2026: Act 164 Conformity | HelloBooks Vermont’s Act 164 of 2026 retroactively conforms to the 2025 federal law for 2025 returns, with decoupling from 174A, 168(n) and FDII or GILTI.
Vermont passed retroactive conformity in 2026, so 2025 returns follow the new federal law except for a short list of business provisions.
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Conformity act
Act 164 (H.933) of 2026
Applies: Tax years beginning on or after January 1, 2025From IRS.gov · checked October 10, 2026
The Department of Taxes says Act 164 retroactively updates Vermont income tax law to Public Law 119-21 for tax years beginning on or after January 1, 2025, and decouples from several provisions starting with 2025.
The department’s conformity page does not say how Vermont treats bonus depreciation, section 179, or the Schedule 1-A deductions. Read the Federal Conformity Supplement and the Act before you prepare returns for business clients with large asset purchases.
General information for tax professionals, not advice on a specific return. Figures are from IRS.gov on the date shown; check the current IRS instructions before filing.
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