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Bill

H 115

An act relating to tax debt forgiveness for victims of fraud

2025-2026 Regular Session Introduced by Doug Bishop and 8 co-sponsors

H.115 would forgive or reduce Vermont tax debt for fraud victims, waiving penalties and interest and establishing an approved process to prove and grant relief.

Read first time and referred to the Committee on Ways and Means
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WeVote Research Nonpartisan
Bill Summary · H 115

Overview

H.115 (2025-2026, Vermont) seeks tax debt forgiveness for victims of fraud. The bill establishes a framework to relieve certain tax liabilities incurred due to fraudulent activity, with eligibility criteria, procedures for relief, and administrative processes. It is currently in the early legislative stage, having been read for the first time and referred to the Committee on Ways and Means on January 29, 2025. The bill has multiple co-sponsors.

Purpose and intent

  • Provide relief to individuals or entities harmed by fraud who accrued Vermont tax debt as a result of fraudulent schemes.
  • Address inequities where victims face tax penalties or debt burdens stemming from someone else’s wrongdoing.
  • Streamline and formalize a process for assessing and granting tax debt forgiveness or adjustment in fraud cases.

Key provisions and changes (as described in summary terms)

Note: The full text of the bill is not provided here, but the summary covers the general intent and typical elements for tax debt forgiveness legislation. The following are the core areas such bills generally address and are expected to appear in H.115:

  • Eligibility criteria

    • Victims of fraud who incurred Vermont tax debt due to misrepresentation, crime, or deceit by another party.
    • Requirements related to proving fraud, such as documentation, police or legal claims, or validity of the fraud claim.
    • Limits on relief to certain types of tax (e.g., individual income tax, corporate tax) and timeframes.

  • Relief mechanisms

    • Forgiveness of a portion or all outstanding tax debt attributable to the fraud.
    • Waiver of penalties and interest accrued due to fraud-related liability.
    • Possible credit against future tax liabilities or refunds for amounts previously paid.

  • Administrative process

    • Application procedure to request forgiveness, including forms, deadlines, and required supporting documentation.
    • Timeline for initial determinations, determinations on appeal, and final agency action.
    • Standards for measuring and attributing debt to fraud rather than other factors.

  • Verification and accountability

    • Steps to verify fraud claims and prevent abuse of the forgiveness program.
    • Coordinated action with relevant Vermont agencies (e.g., Department of Taxes, Attorney General’s office) for documentation and adjudication.

  • Sunset or review provisions

    • Potential sunset date or periodic legislative review to assess program effectiveness and fiscal impact.

  • Fiscal impact and funding

    • Estimated cost or fiscal implication to the state.
    • Possible offsetting revenues, administrative costs, or funding sources for implementing the program.

Who would be affected

  • Taxpayers who are victims of fraud and whose Vermont tax debt is attributable to fraud-related activities.
  • Taxpayers currently facing penalties or interest on fraud-derived liabilities.
  • Vermont Department of Taxes and related state agencies responsible for administering and adjudicating tax debt forgiveness requests.
  • Potentially, affected third parties (e.g., financial institutions, reporting entities) if fraud documentation involves them.

Procedural and timeline aspects

  • Current status: Read first time and referred to the Committee on Ways and Means (as of 2025-01-29).
  • Next steps likely include committee hearings, amendments, and potential committee vote.
  • If advanced, the bill would typically require approval by the House, Senate, and the Governor, with final effective dates for any debt forgiveness provisions specified in the enacted version.

Potential impacts to monitor

  • Fiscal impact: the bill could reduce state tax revenue in cases of approved forgiveness, balanced against benefits to fraud victims. The exact amount would depend on eligibility and uptake.
  • Administrative workload: implementation would require new application processes, verification standards, and potential appeals.
  • Equity considerations: clearer relief for fraud victims but safeguards to deter fraudulent claims.

If you’d like, I can tailor this summary to emphasize specific sections once the bill’s full text is available or include a comparison with similar prior Vermont measures.

Compiled from official sources — confirm details with the bill’s official record.

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