Costs of Selling Land in Vermont
Here is what a land seller usually pays in this state, from transfer tax to capital gains. When you sell to us, we pay the closing costs and you pay no fees or commissions.
- Cash offer in 24 hours
- No fees or commissions
- We pay closing costs
- Close in as few as 7 days
Seller Costs in Vermont at a Glance
| Cost | Typical amount | Who usually pays |
|---|---|---|
| Property transfer tax + clean water surcharge | 1.25% + 0.22% = 1.47% of value for land | Buyer by law |
| Nonresident seller withholding | 2.5% of the price | Withheld by the buyer from a nonresident seller as a tax prepayment |
| Recording fees | Set by the county recorder; charged per document or page | Buyer usually records the deed; seller pays to record lien releases |
| Title search and owner's title insurance | Priced by the title company or attorney; varies with sale price | Set by the contract and local custom |
| Prorated property taxes | Your share of the current year's tax, up to the closing date | Seller for the days owned; unpaid back taxes are paid from the sale |
| Federal capital gains tax | 0%, 15% or 20% of a long-term gain (land held over 1 year); short-term gains taxed as ordinary income; 3.8% NIIT may apply at higher incomes | Seller, on the gain only |
| Vermont income tax on the gain | Taxed under Vermont personal income tax | Seller |
Example: Seller Costs on a $25,000 Land Sale
- Transfer tax owed by the seller
- $0
- Total seller transfer cost
- $0
The tax is 1.47% x $25,000 = $367.50, but the buyer owes it. If you live outside Vermont, the buyer withholds 2.5% x $25,000 = $625 from your proceeds unless an exemption applies and sends it to the state; it is a credit on your Vermont return. Recording, title and prorated taxes are not included.
Selling Costs in Vermont: What to Know
In Vermont the property transfer tax is the buyer's bill, not the seller's. Sellers who live out of state face a 2.5 percent withholding at closing. This page lists each cost of selling land in Vermont, who pays it, and a $25,000 example.
Most of these costs come out of your proceeds at closing, so you see them on the settlement statement, not as bills. The one cost that comes later is income tax on any gain, which you report on your return. This page is general information, not legal or tax advice. Rates change, so confirm them with the office named here or a tax professional before you rely on them.
Vermont property transfer tax and clean water surcharge
Vermont taxes transfers of land at 1.25 percent of value for land that is not a principal residence (32 V.S.A. 9602). A clean water surcharge of 0.22 percent is added (32 V.S.A. 9602a). For vacant land the total is 1.47 percent.
The buyer is liable for the tax when the transfer is made by deed (Vermont Department of Taxes). A higher 3.4 percent rate applies to homes fit for year-round use that the buyer will not live in, which does not cover bare land.
Who pays what in Vermont
Vermont law puts the transfer tax on the buyer. The seller pays for the deed, payoff of liens and back taxes, and the seller's share of the year's property tax. Title and closing fees are split as the contract says.
- Seller: deed preparation, any commission, payoff of liens and back taxes, and the seller's share of the year's property tax.
- Buyer: the property transfer tax and surcharge, recording the deed, and lender costs if any.
- Either side: title work and the closing fee, as the contract says.
Attorney or title company: who closes a land sale in Vermont
Lawyers handle many Vermont closings. The closing lawyer or title agent prepares the deed and the property transfer tax return, records the deed, pays off liens and back taxes, and handles nonresident withholding.
If heirs own the land or an estate is open in probate court, ask who can sign the deed before you sign a contract.
Capital gains tax when you sell land in Vermont
Federal tax applies to the gain, not to the sale price. The gain is roughly the sale price minus what you paid for the land, minus selling costs and the cost of lasting improvements. If you held the land for more than one year, the gain is long term. If you held it one year or less, it is short term and is taxed like wages (IRS Topic 409).
Long-term gains get federal rates of 0, 15 or 20 percent, depending on your taxable income. For 2025, a single filer paid 0 percent on long-term gains if taxable income was $48,350 or less. Higher earners may also owe the 3.8 percent net investment income tax when modified adjusted gross income passes $200,000 for single filers or $250,000 for joint filers (IRS Topic 559).
Vermont taxes gains under its personal income tax. Ask a tax professional or the Vermont Department of Taxes how your gain is taxed in the year you sell.
If you are not a Vermont resident, the buyer must withhold 2.5 percent of the price and send it to the state within 30 days of the sale (32 V.S.A. 5847). The amount is credited when you file.
Recording, title and property tax at closing
Recording fees are set by law and charged by the county office that records deeds. The buyer usually pays to record the new deed. If a mortgage or lien is paid off at closing, the release is recorded too, and the seller usually pays for that.
A title search shows who owns the land and what liens or back taxes sit on it. Owner's title insurance protects the buyer against title problems found later. The price comes from the title company or attorney, and the contract says who pays.
Property tax is split by date. You pay for the part of the year you owned the land, and the buyer pays for the rest. Any back taxes are paid from your proceeds before you get the balance.
How selling to a cash buyer changes the costs
A cash sale has no lender, so there are no loan fees, no appraisal and no financing delays. When you sell to EasyLotBuyer, we pay the closing costs, and you pay no fees or commissions. We can close in as few as 7 days, and we send a cash offer within 24 hours.
We also buy land with back taxes, liens, title problems or no road access, and land held by heirs or an estate. Back taxes are paid at closing from the sale. Tax on your gain is still yours to report, so keep your closing statement for your return. Get a cash offer for your Vermont land.
Sources
- 1. legislature.vermont.gov
- 2. legislature.vermont.gov
- 3. tax.vermont.gov
- 4. legislature.vermont.gov
- 5. irs.gov
- 6. irs.gov
Rules and fees change; check with the county before you act on them.
Selling Cost Questions in Vermont
Who pays the Vermont property transfer tax?
The buyer. Vermont makes the buyer liable for the 1.25 percent tax and the 0.22 percent clean water surcharge.
Does Vermont withhold tax when a nonresident sells land?
Yes. The buyer withholds 2.5 percent of the price and sends it to the state. It counts toward your Vermont income tax.
What closing costs does a seller pay in Vermont?
Usually no transfer tax, since the buyer owes it by law, plus payoff of any liens or back taxes and the seller's share of the year's property tax. Title and closing fees are split as the contract says.
Do I owe capital gains tax when I sell land in Vermont?
Federal tax applies to any gain, and Vermont taxes the gain under its personal income tax. Nonresident sellers have 2.5 percent of the price withheld at closing.
Who pays closing costs when I sell land for cash?
It depends on the contract. When you sell to EasyLotBuyer, we pay the closing costs and you pay no fees or commissions. Back taxes, if any, are paid from the sale at closing.
Are back taxes paid at closing?
Yes. The closing agent pays delinquent property taxes and recorded liens from the sale proceeds, and you receive the balance. You can sell land that has back taxes.