MONTPELIER, Vt. - Beginning July 1, 2024, employers and self-employed individuals will be required to pay the Vermont Child Care Contribution tax. Per Act 76 of 2023, enacted by the Vermont Legislature, employers will pay a 0.44% payroll tax on wages paid, with an option to withhold up to 25% of the tax from employees. Self-employed individuals will pay a 0.11% tax on self-employment income. Employers will remit Child Care Contribution payroll tax payments to the Department in the same manner and frequency as they remit Vermont Income Tax Withholding, with quarterly reporting on the WHT-436 Quarterly Withholding Reconciliation. Self-employed individuals will pay the self-employment Child Care Contribution when filing their 2024 Vermont personal income taxes in calendar year 2025.
Employers’ first payment of the Child Care Contribution will be due October 25, 2024, calculated on wages paid from July 1, 2024, through September 30, 2024, for wages subject to Vermont withholding. Self-employed individuals will pay the self-employment Child Care Contribution when filing their 2024 Vermont personal income taxes in calendar year 2025.
Employees may see information related to the tax on their paychecks beginning after July 1, 2024. Information may include the portion of the tax that their employer has chosen to withhold and the employer-paid portion.
Visit tax.vermont.gov/business/child-care-contribution to learn more about the Vermont Care Contribution.