The Vermont Statutes Online
The Statutes below include the actions of the 2025 session of the General Assembly.
NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.
Subchapter
012
:
SETOFF DEBT COLLECTION
(Cite as: 32 V.S.A. § 5935)
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§ 5935. Joint returns
(a) With respect to State income tax refunds under chapter 151 of this title and renter
credit payments due a claimant under chapter 154 of this title, when the Department
transfers funds payable on a joint return to a claimant agency and only one of the
spouses filing the return is identified as a debtor of the claimant agency, the nondebtor
spouse may, within 30 days after the date of mailing of the notice to the taxpayer
described in subsection 5934(c) of this subchapter, petition the Department in writing
for a return of that portion of the refund attributable to the income of the nondebtor
spouse. The Commissioner shall thereafter conduct a hearing at which the nondebtor
spouse shall bear the burden of establishing what portion of a refund transferred
to a claimant agency, if any, is attributable to the nondebtor’s income.
(b) With respect to payments due a claimant under chapter 154 of this title based on property
ownership, when the Department transfers funds payable on a claim filed with a joint
return to a claimant agency and only one of the spouses filing the return is identified
as a debtor of the claimant agency, the nondebtor spouse may, within 30 days of the
date of mailing of the notice to the taxpayer described in subsection 5934(c) of this title, petition the Department in writing for a return of that portion of the claim equal
to the ownership share that the nondebtor spouse holds in the property upon which
the claim is based. If the property is held as tenancy by the entirety, the claim
shall be divided equally. The Commissioner shall thereafter conduct a hearing at which
the nondebtor spouse shall bear the burden of establishing his or her ownership interest
in the property.
(c) The final determination of the Commissioner regarding the amount of a refund attributable
to the income of a nondebtor spouse or the ownership interest of a nondebtor spouse
may be appealed in the same manner as income tax appeals under subsection 5885(b) of this title.
(d) Upon receipt of a petition under this section, the Department shall notify each claimant
agency to which funds payable on a joint return or claim have been transferred that
the petition is pending. If it is established that any amount of a refund or claim
transferred to a claimant agency is attributable to the income or ownership interest
of a nondebtor spouse, that amount shall be refunded to the nondebtor spouse. (Added 1981, No. 228 (Adj. Sess.), § 1, eff. May 4, 1982; amended 2003, No. 70 (Adj. Sess.), § 45, eff. March 1, 2004; 2021, No. 105 (Adj. Sess.), § 549, eff. July 1, 2022; 2023, No. 6, § 383, eff. July 1, 2023.)