State Form VT WH-434

Annual Withholding Reconciliation

The VT WH-434, “Annual Withholding Reconciliation”, is a form specific to the state of Vermont. Employers use this form to reconcile and report the state income tax they have withheld from their employees during the tax year. Here are the main reasons you need to file a VT WH-434:  

State Compliance 

The Vermont Department of Taxes requires employers who withhold Vermont state income tax from their employees’ wages to report and reconcile these amounts annually. The VT WH-434 is the designated form for this annual reconciliation. 

Verification 

The Vermont Department of Taxes uses the information provided on the VT WH-434 to verify that employers are correctly withholding the required amount of state income tax from their employees’ wages. 

Summary of Withholdings 

The VT WH-434 serves as a summary of the total tax withheld throughout the year. This form essentially reconciles the total amount of Vermont income tax withheld as reported on individual W-2 forms or 1099 forms against the total amount remitted to the state during the tax year. 

Avoiding Penalties 

Filing the VT WH-434 timely and accurately helps employers avoid potential penalties and interest that may be imposed for non-compliance or late submissions. 

Supporting Employee Tax Filings 

By reconciling and reporting the withholding amounts, employers assist the state in efficiently processing individual income tax returns for Vermont residents. 

Record Keeping 

It’s a good practice for employers to maintain a clear record of their tax activities, and submitting the VT WH-434 helps with this record-keeping. 

It’s essential to file the VT WH-434 to remain in compliance with state’s tax laws and regulations when you’ve made payments that require information returns and have had Vermont income tax withheld. Not filing or late filing can lead to penalties and interest charges.