State Tax Waiver Exemption.

[andy.clark179]

Does anyone know or heard of veterans rated 100% disabled being exempt from paying state taxes either on the pension or state taxes?  Could you point out the regulation or form?  Thanks

 

Andy Clark

[brokensoldier244th]

Call the Co. treasurer or assessor. It's a state benefit and can differ by county as to the rules and amount. 

[broncovet]

You are asking a big question.  Property taxes and income taxes are different.    

INCOME TAXES:    My accountant told me "not" to list my VA compensation OR pension anywhere on my tax return as that will confuse IRS, assuming its taxable, when its not.   For disabled Vets, anything we get from VA is not taxable:  Compensation, pension, travel pay, etc.  When it does not show up on your IRS (federal) tax return, it is also non taxable by your state or county either, as far as INCOME tax.  

As far as state and county INCOME taxes, my accountant uses the same numbers as for the IRS, which specifically excludes any mention of VA compensation or pension.  So, VA comp and pension is not taxable.  

Feel free to look up the applicable IRS regulations for yourself, here, if you so desire:

https://www.irs.gov/individuals/military/special-tax-considerations-for-veterans

PROPERTY TAXES:    Each state and county decides on whether there is a waiver of property taxes or not.  In my state, if disabled Veterans want to enjoy the tax waiver, you take a VA letter proving you are a disabled Vet to the treasures office, and you will be issues the waiver.  (States vary widelly..some states charge Veterans no property taxes, while many others, like mine, have a limit.  In my state, my property taxes were about $1200 per year before my VA exemption, and they are now about $300 per year.  So it saves me about $900 per year to go throught the paperwork to get my 100 percent VA disability compensation waiver on a portion of my property taxes.  You will have to check with your state/county, a simple call or visit to your county government offices where they collect property taxes should suffice.  My state government has a special secition which details tax benefits to disabled Veterans.  Most states have something similar, but I have not checked them all.  

Try this link and click your state for more information:  https://www.military.com/benefits/veteran-state-benefits/state-veterans-benefits-directory.html

Summary:  Its been my opinion that IRS and our state governments are much better and more efficient than VA at granting us the applicable benefits.  In other words, most states or the IRS do not make us go through an onerous, complicated application and appeal process, like the VA does.  Its been my experience, that after showing proof of my VA disability 100 percent rating, I get that benefit right away.  

In the case of property taxes, property taxes are paid "in arrears" not in advance for property "you might own" in the future, since most of us cant accurately predict the future.  So, when I take my va disability letter to the courthouse, I still have to pay last years taxes, but next year it will help.  My state wont waive my property taxes "retroactively" to my effective date, but I can. not speak for all states.  

Edited July 7 by broncovet