StatewideForty companies wholly employee-owned
Around 40 Vermont-based companies are wholly employee-owned and many more partly, with more worker cooperatives per person than any other state.
Vermont Employee Ownership Center, 2026
Sell a business in Vermont
The road from today to the years after a sale runs through Vermont's rules. Here it is in the order you will meet them: where you stand, what the state takes, the rules of the sale, who buys, and what the money can do after.
ComplexityMediumTax on the gain8.75% 2025Deal volumeVery lowEstate tax
Vermont is one of the quietest markets, where the strongest buyers are usually brought in from outside the state. The state's share of the gain is among the highest, 8.75% at the top, with part of a long-term gain excluded. Expect a tax-clearance or bulk-sale notice before closing, and an estate tax to plan the proceeds around.
Tax on the gain: Part of a long-term gain is excluded, up to a cap.
Today
Where you stand
Vermont taxes a gain at up to 8.75 percent, taxes estates above 5 million, and asks the buyer to notify the state first.
Nearly 82,000 small businesses employ 62.1 percent of Vermont workers, above the national share; construction leads the firms with staff, and baby boomers own 58 percent of small businesses.
The small-business base
0
small businesses
0
employees
0.0%
of workers
SBA Office of Advocacy, 2025
Vermont had 81,949 small businesses in 2022, 99.0 percent of all firms, employing 157,959 people, or 62.1 percent of workers, above the national share.
Only 17,019 small Vermont firms have employees; construction is the largest group with 2,777, followed by retail with 1,978.
Baby boomers own 58 percent of Vermont small businesses, worth over $11 billion; the employee-owners of Vermont Information Processing sold the Colchester firm to private equity for $1 billion.
The elements this touches
- TmTime The years before you want out. It feeds the exit-readiness score and never moves the price; every other decision is planned against it.
ListenThe Vermont briefing, read aloud
The deal team on what changes when you sell a business in Vermont.
Before the letter of intent
What Vermont takes
The tax on the gain, and what to settle before a buyer names a price
Gains are taxed as income at up to 8.75 percent with a partial exclusion for assets held over three years, and estates above 5 million pay a flat 16 percent.
State tax on the gain
0.00%
Part of a long-term gain is excluded, up to a cap.
Tax Foundation, 2025
A founder on film
On what he learned about tax on the way to the sale.
Lewis Titus Wastewater purification and manufacturing · Wyoming
Gains taxed up to 8.75
Vermont personal income tax rates for 2025 run from 3.35 percent to 8.75 percent, and capital gains are taxed as income.
A 40 percent exclusion option
Exclude a flat $5,000 of gain, or 40 percent of gain on assets held over three years, capped at 40 percent of federal taxable income or $350,000.
The exclusion fits private companies
The 40 percent option excludes homes, most depreciable personal property, and publicly traded stocks and bonds, so it fits a closely held business.
The rate is the state's top rate on the gain for the year shown, the same figure as the indicator in the hero, so the two can never disagree.
The elements this touches
- TxTax Strategy The deal and entity structure, set before the letter of intent. FNDRS tracks whether it is in place. It never moves the price; it changes what you keep.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
Under contract and at closing
The rules of the sale
The rules a sale in Vermont runs under
A buyer must give the Tax Commissioner ten days' written notice before a bulk sale, and a bill to void most employee non-competes, sparing sale-of-business covenants, was still pending in 2026.
01Ten days notice to Commissioner
Under 32 V.S.A. 3260 the buyer must notify the Commissioner in writing at least ten days before taking possession or paying, with price and terms.
Vermont General Assembly (Vermont Statutes Online), 2025
02No escrow, buyer is liable
If the state has a tax claim the buyer must escrow that amount; skip the notice or the escrow and the buyer is personally liable for the seller's taxes.
Vermont General Assembly (Vermont Statutes Online), 2025
03Non-compete ban still pending
H.205, a 2025 bill to void most employee non-competes while sparing business-sale covenants and earners above $100,000, was recommitted to House Commerce on 13 March 2026, unpassed.
Vermont General Assembly, 2026
The elements this touches
- LcLegal & Compliance Contracts, licences, and filings in order and enforceable. The FNDRS valuation reads it, and the score moves the multiple.
- DrData Room The documents a buyer will ask for, ready before they ask. FNDRS tracks it in the deal-readiness report card; it decides how fast and how cleanly a deal closes.
One thing you would not guess
Vermont has a statewide non-profit that steers retiring owners toward employee ownership, yet employee ownership does not always keep a company local: Gardener's Supply went to an Indiana buyer out of bankruptcy.
Employee ownership does not always keep a firm local: Gardener's Supply was bought out of bankruptcy by an Indiana company, partly as longtime employee-owners cashed out.
A statewide non-profit, the Vermont Employee Ownership Center, exists to steer retiring owners toward ESOP or worker cooperative sales.
When the process opens
Who buys
Who shows up for a business in Vermont
Vermont owners sell to their employees more than almost anywhere, helped by a state-backed employee ownership centre and a long list of ESOP conversions.
StatewideStaff over the highest bidder
Engineers Construction Inc. moved to 100 percent employee ownership through an ESOP in 2024, its owners choosing staff over the highest bidder.
Vermont Business Magazine, 2024
BurlingtonAn HVAC firm went ESOP
Alliance Group, an Essex Junction HVAC firm with over 100 staff, converted to a 100 percent ESOP in 2019; Benoure, Rovers North, and Green River followed.
Vermont Small Business Development Center, 2019
The elements this touches
- SyStrategic Synergy What one buyer gains that another cannot. The buyer at the table prices it, which is why the sell-side process goes looking for them.
Day 0, and the years after
After the close
What Vermont lets the proceeds do
Vermont keeps an estate tax with a 5 million exclusion and a flat 16 percent rate, far below the federal threshold, so post-sale wealth held there needs planning.
Estate tax, flat 16 percent
Vermont taxes estates above a $5 million exclusion at a flat 16 percent.
WealthThe exclusion reached $5 million
The exclusion reached $5 million for deaths in 2021 or later, after $2.75 million through 2019 and $4.25 million in 2020.
WealthWhere FNDRS comes in
The post-exit wealth plan is the third act of the same engagement, and it starts in diligence, before the letter of intent, when a move or a trust can still change the answer.
FNDRSThe elements this touches
- EsEstate Architecture Trusts and ownership set up before the letter of intent. It changes what the family keeps, not what a buyer pays.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
People who walked it
Founders
Founders who worked with FNDRS, in their own words
From founders elsewhere
What founders say about working with FNDRS
No founder in Vermont is quoted yet. These are founders in other states, quoted word for word, each described by role and state.
1 of 3
“I definitely don't think we'd be in the same spot without you guys.”
No founder in Vermont is on film yet. These are founders in other states who worked with FNDRS.47 founders on film
Nearby
Other states in the Northeast
| Northeast | Tax on the gain | Complexity | Deal volume |
|---|---|---|---|
| Connecticut | 6.99% 2025 | Medium | Medium |
| Maine | 7.15% 2025 | Medium | Low |
| Massachusetts | 9% 2025 | Medium | High |
| New Hampshire | None 2025 | Low | Low |
| New Jersey | 10.75% 2025 | Medium | High |
| New York | 10.9% 2025 | Medium | Very high |
| Pennsylvania | 3.07% 2025 | Medium | High |
| Rhode Island | 5.99% 2025 | High | Very low |
Your next step
The road starts with one step
Know where you stand in fifteen minutes, or talk the Vermont sale through with a dealmaker. Either way, no pitch and no obligation.
Selling in Vermont? Start with a conversation
No pitch and no obligation. If the honest answer is not yet, we will say so, and say what to work on.