BILL AS INTRODUCED S.68
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1 S.68
2 Introduced by Senator Lyons
3 Referred to Committee on
4 Date:
5 Subject: Taxation; personal income tax; deduction; student loan payments
6 Statement of purpose of bill as introduced: This bill proposes to expand the
7 personal income tax deduction for student loan payments made by Vermont
8 taxpayers on their own qualifying student loans to include payments of
9 principal. The deduction for payments of principal on student loans would
10 apply in addition to the existing deduction for payments of interest.
11 An act relating to the deduction for student loan payments
12 It is hereby enacted by the General Assembly of the State of Vermont:
13 Sec. 1. 32 V.S.A. § 5811 is amended to read:
14 § 5811. DEFINITIONS
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16 (21) “Taxable income” means, in the case of an individual, federal
17 adjusted gross income determined without regard to 26 U.S.C. § 168(k) and:
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19 (B) decreased by the following items of income (to the extent such
20 income is included in federal adjusted gross income):
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 BILL AS INTRODUCED S.68
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2 (vi) the amount of principal and interest paid by a qualified
3 resident taxpayer during the taxable year on a qualified education loan for the
4 costs of attendance at an eligible educational institution; and
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6 (29) As used in subdivision (21)(B)(vi) of this section:
7 (A) “Qualified education loan” and “eligible educational institution”
8 shall have the same meanings as under 26 U.S.C. § 221(d).
9 (B) “Qualified resident taxpayer” means an individual qualifying for
10 residency as defined under subdivision (11) of this section and whose adjusted
11 gross income is equal to or less than:
12 (i) $120,000.00 if the individual’s filing status is single, head of
13 household, or married filing separately; or
14 (ii) $200,000.00 if the individual’s filing status is married filing
15 jointly.
16 Sec. 2. EFFECTIVE DATE
17 Notwithstanding 1 V.S.A. § 214, this act shall take effect retroactively on
18 January 1, 2023 and shall apply to taxable years beginning on and after
19 January 1, 2023.
VT LEG #365502 v.2


Statutes affected:
As Introduced: 32-5811