Vermont Tax Deadlines After Death: EST-191, FIT-161, E-2A Clearance Timeline

Vermont estate administration does not move on a single timeline — it runs on four separate tax clocks simultaneously. Each has its own deadline, its own penalty structure, and its own consequences for probate closure. Miss one, and the ripple effect delays everything else.

Here is how the deadlines stack, what each form requires, and how to sequence them so the estate closes without penalty.

The Four Tax Clocks

When someone dies in Vermont, these four tax obligations start running:

These are not optional filings you can sequence in any order you choose. The E-2A clearance — which is the key that unlocks the ability to close probate and distribute assets — depends on all the other returns being complete. Work backwards from that gate.

Clock 1: The Final Individual Return (Form IN-111)

The decedent's last personal income tax return covers income from January 1 of the year of death through the exact date of death. Deadline: April 15.

If the decedent died early in the tax year (say, February), the return still isn't due until the following April 15. If they died in December, you have roughly three months to gather records and file.

Married decedents: The surviving spouse may file a joint return for the year of death, potentially reducing the overall tax burden. This is worth evaluating with a CPA in the weeks after death, not the week the return is due.

Refunds: If the decedent overpaid through withholding and a refund is owed, attach federal Form 1310 to claim it on behalf of the estate. The IRS and Vermont Department of Taxes do not issue refunds to deceased individuals without that form.

Extension: If you need more time, file an extension request before April 15. An extension gives you six additional months to file the paperwork, but it does not extend the time to pay. Any tax owed is still due by April 15. Pay your best estimate with the extension to minimize interest accumulation.

Vermont's underpayment interest rate for 2026 is 7.75% annually — roughly $64/month on every $10,000 of unpaid tax. The failure-to-file penalty is an additional 5% per month on the unpaid balance. These add up fast.

Clock 2: The Fiduciary Income Tax Return (Form FIT-161)

Once the decedent dies, the estate becomes a separate taxable entity. Any income those assets earn during the administration period belongs to the estate — and Vermont requires Form FIT-161 to report it.

The filing trigger is deliberately low: $100 in Vermont income, or $1,000 in gross income from Vermont sources, or a federal Form 1041 filing requirement. Most estates will cross at least one of these thresholds within months.

Fiscal year flexibility: Unlike the final individual return, the estate's fiduciary return can follow any fiscal year you choose. You can elect a fiscal year ending any month (e.g., May 31 or October 31 instead of December 31). This gives you timing flexibility to align the first FIT-161 with when the estate's major income events occur.

Deadline: 15th day of the 4th month after the end of your chosen fiscal year.

Estimated payments: If the estate generates substantial ongoing income, Vermont requires quarterly estimated payments using Form FIT-165. Missing them creates underpayment penalties at the same 7.75% annual rate.

Clock 3: The Vermont Estate Tax Return (Form EST-191)

This clock only starts running for estates whose gross value — plus any gifts made within two years of death — exceeds $5 million.

Vermont's estate tax is simple in structure: 16% flat rate on everything above the $5 million threshold. No progressive brackets, no portability between spouses, no inflation indexing.

Examples:

• Estate worth $4.8 million: No Vermont estate tax owed. EST-191 not required.
• Estate worth $6 million: Tax owed on $1 million at 16% = $160,000
• Estate worth $8 million: Tax owed on $3 million at 16% = $480,000

Deadline: EST-191 is due nine months from the date of death. Unlike the final individual return (which has a calendar deadline), the estate tax due date floats based on the actual death date.

Extension — Form EST-195: If you need more time to complete appraisals and gather documentation, file Form EST-195 before the nine-month deadline. This grants an automatic six-month extension to file the paperwork.

Critical: the extension is for filing only, not for paying. The estimated tax owed is still due at the nine-month mark. Underpayments accrue interest at 7.75% annually from the original due date — not from when you eventually file. If you expect a significant estate tax bill, pay an estimate with Form EST-195 and reconcile when you file the complete return.

Gift lookback: Vermont adds back taxable gifts made within two years of death when calculating the gross estate. Large gifts in that window could push an estate over the $5 million threshold even if remaining assets do not.

Clock 4: The Tax Clearance (Form E-2A)

Form E-2A — Vermont Estate Tax Information and Application for Tax Clearance — is not technically a "deadline" form. It is the finish line.

The Vermont probate court cannot enter the final order of distribution or discharge the executor's bond without this clearance in hand. Under 32 V.S.A. § 7454, the Commissioner of Taxes must certify that all tax obligations have been satisfied before the estate can close.

The Department of Taxes will not issue E-2A clearance until it verifies:

• The final individual return (IN-111) has been filed and any balance paid
• All fiduciary returns (FIT-161) have been filed and any balance paid
• The estate tax return (EST-191) has been filed and any balance paid (if applicable)

This sequencing means E-2A is always the last tax step — and delays in any of the earlier filings push back the entire probate closure. Estates commonly stay open for 12 to 18 months in Vermont, with the E-2A waiting period being one of the primary causes.

If Vermont real property was subject to an estate tax lien under 32 V.S.A. § 7497, the lien release is recorded through the state's myVTax portal after clearance is issued. Town clerks use this portal to formally clear the property's land records.

How to Sequence the Filings

Working backwards from the goal of closing probate:

1. Day 1–30: Obtain the EIN, open estate bank account, secure assets, begin inventory
2. Month 1–3: File IN-111; gather account statements to assess FIT-161 threshold
3. Month 3–9: File FIT-161 for the estate's first fiscal year; pay estimated quarterly tax via Form FIT-165 if income is ongoing
4. Month 9 (or earlier): File EST-191 or extension form EST-195 with estimated payment if gross estate exceeds $5 million
5. Month 9+: Submit Form E-2A to the Vermont Department of Taxes
6. After clearance received: Distribute assets, collect beneficiary receipts, file Fiduciary's Closing Report with the court

The Vermont Final Tax & Estate Tax Guide provides a form-by-form checklist for each phase of this sequence — including what documentation the Department of Taxes needs to process your E-2A clearance without delays.

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