Property tax classifications [Effective July 1, 2029 if contingency met]
32 V.S.A. § 4152a
proposed4152a. Property tax classifications [Effective July 1, 2029 if contingency met]
(a) Establishment. Each parcel of real estate shall be classified as one or more of the classifications listed under subsection (b) of this section and based on information and guidance provided by the Commissioner of Taxes under this section and rules adopted pursuant to section 5410 of this title.
(b) Classifications. A parcel shall be assigned one or more of the following general classes:
(1) homestead;
(2) nonhomestead nonresidential; and
(3) nonhomestead residential.
(c) Definitions. As used in this section:
(1) “Commissioner” means the Commissioner of Taxes.
(2) “Dwelling unit” means a building or part of a building, including a single-family home, a unit within a multifamily building, an apartment, a condominium, or other similar property or structure containing a separate means of ingress and egress that:
(A) is designed or intended to be used for occupancy by one or more persons in a household, including providing living facilities for sleeping, cooking, and sanitary needs; and
(B) is fit for year-round habitation as determined by the Commissioner.
(3) “Homestead” has the same meaning as in subdivision 5401(7) of this title and means a parcel, or portion of a parcel, declared as a homestead on or before October 15 in accordance with section 5410 of this title for the current year.
(4)(A) “Long-term rental” means:
(i) a dwelling unit for which rent is paid for the right of occupancy for periods of at least 30 days;
(ii) a dwelling unit with combined rental periods in the current calendar year that total at least six calendar months, which need not be consecutive; and
(iii) the Commissioner determines there is a bona fide landlord-tenant relationship between the parties. To make this determination, the Commissioner may consider whether the landlord and tenant are related parties, whether the landlord charges the tenant fair market rent, whether the landlord is an entity with a business purpose other than the avoidance of tax, and any other factor the Commissioner deems relevant.
(B) “Long-term rental” also means a dwelling unit used by an employer to house the employer’s employees for at least six calendar months, which need not be consecutive, in the current calendar year. As used in this section, “employee” means an individual who is reported by an employer for purposes of complying with Vermont unemployment compensation law pursuant to 21 V.S.A. chapter 17 or a farm employee as defined by 9 V.S.A. § 4469a(a)(1), without regard for whether the farm employee is reported pursuant to 21 V.S.A. chapter 17.
(5) “Nonhomestead nonresidential” means a parcel, or portion of a parcel, that does not qualify as “homestead” or “nonhomestead residential” under this section.
(6) “Nonhomestead residential” means a parcel, or portion of a parcel, with a dwelling unit that is not:
(A) a homestead;
(B) rented out as a long-term rental;
(C) a manufactured home, as defined under 10 V.S.A. § 6201(1), but not including other types of manufactured homes; or
(D) part of a lodging establishment licensed under 18 V.S.A. chapter 85, subchapter 2.
(d) Mixed-use parcels. A parcel with two or more portions qualifying as different classifications shall be classified proportionally as follows:
(1) Buildings shall be classified proportionally based on the percentage of finished floor space used. Improvements and structures on a nonhomestead residential parcel shall be classified as nonhomestead residential unless used for a business purpose.
(2) Underlying land, including improvements or fixtures that lack floor space, shall be classified proportionally based on the same percentage as the finished floor space of the buildings.
(3) Notwithstanding any provision of this subsection to the contrary, the entire parcel of land surrounding a homestead shall be classified as homestead in accordance with subdivision 5401(7) of this title, including any improvements or structures considered part of a homestead under subdivision 5401(7)(F) of this title.
(4) If a portion of floor space is used for more than one purpose, the use for which the floor space is most often used shall be considered the primary use and the floor space shall be dedicated to that use for purposes of tax classification, except as provided for a homestead under subdivision 5401(7) of this title.
(e) Forms. The Commissioner shall amend existing forms, and publish new forms, as needed to gather the necessary attestations and declarations required under this section.
(f) Use value appraisal. Nothing in this section shall be construed to alter the tax treatment or enrollment eligibility of property as it relates to use value appraisal under chapter 124 of this title.
Added 2025, No. 170 (Adj. Sess.), § 58, contingently eff. July 1, 2029.
Source: Vermont General Assembly (legislature.vermont.gov)URL: https://legislature.vermont.gov/statutes/section/32/129/04152aFetched: 10/21/2026