Which states have no property tax for disabled veterans?

By James·23 October 2026

You have a 100% service-connected rating from the VA, and you own the home you live in. In 18 states, that rating removes the property tax on the home entirely. In two more, the state income tax refunds the whole bill. Three more come close. Everywhere else the break is smaller: a fixed amount, an income test, or a rule set by each town.

In 18 states, a 100% disabled veteran pays no property tax on the home

The home itself is exempt, at any value.

Alabama, Arizona, Arkansas, Florida, Hawaii, Indiana, Iowa, Louisiana, Maryland, Michigan, Mississippi, Nebraska, New Jersey, New Mexico, Oklahoma, South Carolina, Texas, Virginia

The saving is the whole bill. In New Jersey the typical homeowner pays $9,590 a year in property tax, by the Census Bureau's 2020-2024 survey. A qualifying veteran there pays nothing on the home. In Alabama, where taxes are lowest of the 18, the typical bill is $788.

Indiana's exemption is new this year. It starts with taxes assessed in 2026 and paid in 2027. A veteran who had Indiana's old $14,000 deduction must file again to get it.

Arizona rewrote its rule in June 2026. The law now says the primary residence of a veteran rated 100% service-connected is fully exempt from taxation (A.R.S. 42-11111(C)).

Hawaii's counties set their own exemptions. Honolulu's is full, apart from a minimum tax of $300 a year.

The states with the highest bills mostly do not do this. Of the ten states with the highest typical bills, only New Jersey exempts a disabled veteran's home in full.

Two states refund the whole bill instead

West Virginia and Wisconsin do not exempt the home. You pay the bill, then claim it back as a refundable credit on your state income tax return. A refundable credit is paid out even when you owe no income tax.

West Virginia's starts at a 90% rating, and Wisconsin's at 100%. Both accept individual unemployability. Wisconsin covers the home and up to one acre of land.

West Virginia counts only tax paid on time. Its law allows no credit for any untimely real property tax paid (W. Va. Code 11-13MM-4).

Three more states come close, with one limit each

Illinois exempts the first $250,000 of equalized assessed value for a veteran rated 70% or more. That threshold is lower than every full-exemption state's. A rating of 50% to 69% takes $5,000 off instead.

Utah exempts taxable value up to a yearly limit, scaled by the rating. At 100%, or with individual unemployability, the whole limit applies. It was $479,504 for 2023 and rises with inflation each year (Utah Code 59-2a-101).

Connecticut has exempted the house itself since October 2024, for a 100% permanent and total rating. The land does not count. One town's application says The building lot, excess land and outbuildings will continue to be taxed.

A 100% rating is not always enough

This is where veterans lose the exemption they expected. The VA can pay at 100% in several ways, and state laws treat them differently. The letter you hand the assessor has to match the state's words.

A 100% rating can be temporary, with a future examination. A permanent and total rating, often written P&T, is one the VA expects to last. The federal rule defines it plainly: Permanence of total disability will be taken to exist when such impairment is reasonably certain to continue throughout the life of the disabled person.

Individual unemployability is the third route. The VA pays it when a service-connected disability keeps you from working. VA.gov describes it as compensation at the same level as a Veteran rated 100%.

Among the 18 full-exemption states, 11 write permanence into the rule: Alabama, Arkansas, Florida, Iowa, Maryland, Michigan, New Jersey, New Mexico, Oklahoma, South Carolina and Virginia. A veteran rated 100% with a future examination can be refused there.

Only four of them name individual unemployability as a qualifying rating: Iowa, Louisiana, Michigan and Texas. Elsewhere, a veteran paid at 100% for unemployability depends on how the state reads its own wording.

Moving resets all of this. Texas accepts a 100% rating or unemployability (Tax Code 11.131). Florida's statute asks for a service-connected total and permanent disability. The same veteran can qualify in one and not the other.

The defense is paperwork, done before you buy. Download the VA Benefit Summary Letter from VA.gov, and compare its words with the state's rule in the table below. Then ask the county assessor, in writing, whether that letter qualifies.

None of these exemptions is automatic.

You apply to the county, by its deadline. Colorado's runs January 1 to July 1. Nebraska's filing window is February 1 to June 30. Montana's deadline is April 15.

A missed year is sometimes recoverable. Florida refunds tax on a home bought during the year once the exemption is granted the next year. South Dakota refunds up to four years for a veteran whose permanent and total rating was still pending.

Most states give a fixed amount instead

A set amount off the value or the bill is the rule in 19 places. The largest is the District of Columbia's: $445,000 off assessed value, for household income under $163,500. Minnesota excludes up to $300,000 of market value, and South Dakota $200,000 of full value.

California takes $180,671 off assessed value in 2026, or $271,009 below an income limit. Alaska exempts the first $150,000 from a 50% rating. Georgia's $121,812 follows the federal housing grant amount and changes each year.

At the small end, Maine takes $6,000 off value, and Wyoming $6,000 off assessed value. Idaho cuts the bill by up to $1,500. Delaware removes only the school portion of the tax.

The dollar amounts do not compare across states. Each state assesses homes at its own share of market value. A $6,000 cut in one state is not the same as $6,000 in another.

Where income or the town decides it

Pennsylvania exempts the home in full, but only with financial need. Need is presumed at income of $114,637 or less. Above that, allowable expenses must exceed income. The veteran must also have served in a war or armed conflict.

Montana cuts the tax rate on the home by 50% to 100% for a 100% rating, by income. The full cut applies to 2025 income up to $49,654 for a single filer. Washington's exemption starts at an 80% rating, with income limits set county by county.

In Massachusetts, New Hampshire, New York and Rhode Island, the amount depends on the city or town. For a 100% disability with specially adapted housing or an inability to work, Boston takes $793 off the fiscal 2027 bill. The city's added relief can double it to $1,586. In New Hampshire, Exeter's credit is $2,000 and Windham's $4,750.

New York has a new local option. From October 2026, a city, town, village or school district may fully exempt a veteran rated permanent and total. Each one decides whether to offer it.

Kansas and Missouri give no exemption at all, only income-limited refunds. Missouri's credit reaches $1,100 for a homeowner with income of $30,000 or less, single.

These rules change every year

Check the year next to any amount.

Many of the amounts rise each year. California's goes from $180,671 in 2026 to $185,889 in 2027. Oregon's rises 3% a year. Nevada and Utah raise theirs with inflation, and Georgia's follows a federal grant that changes each year.

The laws change too. Arizona and Indiana rewrote theirs in 2026. From 2026, Arkansas also counts a home held in a qualifying trust or LLC. New York's towns and cities may offer a full exemption from October 2026.

I read every state's rule again each January. When a rule or an amount changes, the date under the title will say Updated. The county assessor always has this year's figure.

Typical bill: median real estate taxes paid by owner-occupied homes, Census Bureau American Community Survey 2020-2024 (table B25103). Rules read on each state's statute, revenue or veterans department, or an official county or town page, October 22 and 23, 2026.

Surviving spouses keep it in most of these states

Most full-exemption states protect a surviving spouse.

In 16 of the 18, the law or the tax office says a surviving spouse can keep the exemption. In most of them that lasts only while the spouse stays unmarried.

For Alabama and Texas, I did not read the spouse rule on an official page, so this page does not state it.

What this page does not cover

I read each state's own rule, but not every local addition. Many cities and counties add their own relief on top. Vehicles and other personal property, which some states exempt too, are not covered here.

Three gaps are specific. The websites of Hawaii's other three counties would not open for me, so only Honolulu is shown. Georgia's 2026 amount was not yet on its revenue page, so 2025's is shown. Utah's 2026 limit was not published where I could read it.

What the page does give is the rule in every state, in its own words, with its source.

Before you move for a property tax break

Property tax is one bill among several. Four questions settle whether a move pays.

Does your VA letter say permanent and total? If not, look only at states that accept a plain 100% rating or unemployability.

Is there a cap or an income test? Illinois, Utah and the District of Columbia limit by value or income. Pennsylvania and Montana test income or need.

What will the state tax on your retirement pay? The guide to which states do not tax military retirement covers that, and the best states for military retirees runs the whole budget.

What does the rest of life cost there? The guide to what retirement actually costs in each state prices housing, health care and taxes for retirees in all 51.

Printed from https://savingslast.com/states-with-no-property-tax-for-disabled-veterans/ on . The figures reflect the inputs shown and the rules as published on that date.