New York Veterans—Do you know about the Property Tax Benefit?

Veterans who live in New York have two ways to receive a property tax exemption. The Alternative Veterans Tax Exemption is available to veterans that served in foreign wars, their spouses or widows, those who are expeditionary medalists, and Gold Star parents. The veteran must have an honorable discharge.

The other method is the Eligible Funds Exemption, which does not require the residence to be a primary residence. If a veteran used eligible funds to purchase a home, the veteran’s home qualifies for the exemption. Recently, New York exempted school taxes, which increases the amount a veteran can save on homestead taxes each year.

A veteran might have one or the other exemptions—not both.

Application Date

Veterans have until March 15 to apply for the exemption, which covers the tax period starting in July of the same year. If the veteran does not apply by March 15, the exemption will not apply until the following year.

Eligible Service Times for the Alternative Veteran’s Benefit

If you served during certain times, you might be eligible for the Alternative Veteran’s Benefit.

In addition to other requirements, you must have served:

  • World War I from April 6, 1917, through November 11, 1918.
  • World War II from December 7, 1941, through December 31, 1946.
  • Korean War from June 27, 1950, through January 31, 1955.
  • Vietnam Conflict from November 1, 1955, through May 7, 1975.
  • Gulf War and Iraq and Afghanistan Conflicts from August 2, 1990, through the present (at the time of publishing, September 2022). The Persian Gulf Conflict includes Operation Enduring Freedom, Operation Iraqi Freedom, Operation New Dawn (Afghanistan), Operation Joint Forge, Operation Joint Endeavor, and Operation Joint Guard.

The property must be the veteran’s primary residence to qualify for the exemption. Veterans must submit a copy of their DD-214 to be eligible.

In some cases, New York might accept separation papers or a letter from the New York State Division of Veterans’ Services stating that the veteran has an other than honorable discharge and qualifies because the veteran was discharged due to:

Exemption Rates for Qualified Veterans

A qualified veteran will receive a reduction of 15 percent of the property’s assessed value with a maximum exemption of $2,880 for tax class 1 and $21,500 for tax classes 2 and 4.

If the veteran served in a combat zone, they would receive an additional 10 percent exemption. The maximum of the combat zone exemption is $1,920 for tax class 1 and $14,400 for tax classes 2 and 4.

A disabled veteran receives an exemption of the property’s assessed value times 50 percent of the veteran’s disability rating. The maximums for disabled veterans are $9,600 for those in tax class 1 and $72,000 for those in tax classes 2 and 4. To receive the disability exemption, you must forward a copy of your disability rating letter from the VA to the state.

The veteran must have served in an active combat zone. For example, a veteran in Vietnam during the Vietnam War will receive an extra 10 percent. If a veteran served in the United States during Vietnam, that veteran does not qualify for the additional 10 percent.

The Additional School Tax Exemption

Veterans who already receive a property tax exemption because of their service do not have to do anything to receive the additional school tax exemption. The state automatically adds the extra amount for more savings. The new tax amount started on the January 2018 bill for Alternative Veterans and on the April 2018 bill for those receiving Eligible Funds.

The exemption applied to the tax period for July 1, 2017, for Alternative Veterans and the January 1, 2018, tax period for those receiving Eligible Funds.

Documents Proving Eligibility

While the best document to show eligibility for the tax exemption is the DD-214, you can use several other documents in certain situations, including:

  • Transcript of Military Record; Statement of Service (DA 1569 and AHRC Form 2496-E).
  • S. Uniformed Services Identification Card (DD 2 Retired).
  • DD 303 Certificate in Lieu of Lost or Destroyed Discharge.
  • DD 303AF Certificate in Lieu of Lost or Destroyed Discharge.
  • DD 303CG Certificate in Lieu of Lost or Destroyed Discharge.
  • DD 303MC Certificate in Lieu of Lost or Destroyed Discharge.
  • DD 303N Certificate in Lieu of Lost or Destroyed Discharge.
  • DD 1300 Report of Casualty.
  • ADJ 545 Discharge Certificate.
  • Army DS ODF Honorable Discharge from the United States Army.
  • AGO 525 Discharge Certificate.
  • AGO 755 Discharge Certificate.
  • AGO 01252 Discharge Certificate.
  • AGO 01254 Transcript of Military Record.

And several others.

Restoration of Honor Act

New York signed the Restoration of Honor Act in 2019. This act allows the New York State Division of Veterans’ Services to restore state benefits to certain veterans with an Other than Honorable Discharge.

Only veterans who received an Other than Honorable Discharge because of post-traumatic stress disorder, traumatic brain injury, military sexual trauma, sexual orientation, and gender identity are eligible for the property tax exemption in New York.

Veterans should be aware that this Act does not change the veteran’s ruling from the military—it only allows them to take advantage of the property tax exemption and other benefits that New York might offer to veterans with an Other than Honorable Discharge.

The documents the veteran must submit include:

  • The Restoration of State Veterans Benefits Application.
  • The veteran’s complete military personnel file.
  • A signed personal statement from the veteran that describes why the veteran’s character of service was unjust and why the veteran believes the state should upgrade their character of service.
  • An award letter from the United States Department of Veterans Affairs verifying that the veteran has a service-connected rating for disability where applicable.

Suppose the Other than Honorable Discharge is because of a mental health condition—PTSD, TBI, or MST that happened during the veteran’s honorable service. In that case, the veteran must also submit certain documents if the mental health condition caused the veteran to act in such a way that the veteran received a Less than Honorable Discharge.

These documents include:

  • A medical diagnosis of the disability that caused the veteran’s actions that led to the Less than Honorable Discharge.
  • Evidence that the veteran’s disability started or got worse during the veteran’s military service.
  • A signed explanation by the veteran of how the diagnosed mental illness caused the veteran to receive a Less than Honorable Discharge.
  • When applicable, the veteran’s award letter from the United States Department of Veterans Affairs showing the veteran’s service-connected rating for the disability (e.g., PTSD).

How to Apply for the Veterans’ Exemption for Property

Veterans can apply online or via a paper application. If you are unsure how to proceed or received a denial of benefits and wish to appeal your application, a New York benefits attorney can help you recover the benefits you deserve.

Applying Online

If applying online, you must use an NYC.ID account. It requires that you log in using your email and a password. Alternatively, you can log in using various other methods, including social media accounts, Google accounts, Yahoo accounts, Microsoft accounts, or your NYC Employees account.

Applying via Paper Application

You can download the paper application using the link above. The first sheet of the Veterans Exemption Initial Application helps you determine whether you are eligible. If certain cooperations manage your property, you are not eligible.

The property must be the primary residence of the veteran, an un-remarried surviving spouse, or the parent of a soldier killed in action. The veteran must be honorably discharged, with the exceptions listed above. Finally, the veteran must have served during a certain period.

Review Page 2 for important information, including the file by date. This page also describes how to find your property information if you do not know it and what a primary residence is.

Businesses are not eligible to receive homeowner tax benefits. You could also transfer the exemption if you show proof that you had the exemption for your previous residence. Make sure both residences are in New York State, and that the state receives the application within 30 days of purchasing your new property.

Additionally, be sure you mail the application in time for it to be postmarked by March 15, or you will not receive the exemption for the July tax period.

Submit paper applications to:

NYC Department of Finance, P.O. Box 311, Maplewood, NJ 07040-0311.

Include the required documentation, including a copy of your DD 214 or other separation papers.

If an un-remarried spouse is making the application, the spouse must provide a copy of their marriage certificate, a copy of the veteran’s death certificate, a copy of the veteran’s disability award letter, if the veteran was disabled, and when applicable, a copy of the New York State Department of Veterans’ Services Restoration of Honor letter.

Veterans and spouses can request a copy of the veteran’s DD 214 by contacting the National Personnel Records Center, 1 Archives Drive, St. Louis, Missouri, 63138. You can also contact the NPRC online or by calling (866) 272-6272.

Cooperative Owners

If certain cooperatives control your property, you are not eligible for the property tax exemption benefit.

Ineligible cooperative-controlled properties include those controlled by:

  • Mitchell-Lama
  • Limited-Profit Housing Company
  • Redevelopment Company
  • Housing Development Fund Company
  • Limited Dividend Housing Company

If your cooperative is eligible, you must provide a copy of the stock certificate.

Additional Documents

Some people put their assets into a trust. If the property is in the name of a trust, provide a copy of the trust agreement. If someone willed you the property, submit a copy of the last will and testament or a probate court order.

Completing the Application

The first section of the application includes information about your property, including:

  • The borough, block, and lot number.
  • The number of cooperative shares if a cooperative manages the property.
  • The city, state, and zip code of the property.
  • The type of property, e.g., condominium, cooperative, one to three family dwelling, or a dwelling with four or more families. You must enter the percentage of space you use for your primary residents if the dwelling is for four or more families.
  • A set of four questions regarding exclusivity, life estates, trusts, and wills.

If the answer to any of those questions is “No,” you might not be eligible for the property tax exemption.

Section 2 is the information you must provide with the application, including a copy of your DD 214 or equivalent documents. You must also provide your name, date of birth, social security number, street address, phone number, and email address for Owner 1. If more than one person is on the deed, the application has room for two additional owners.

Section 4 is so that you can list additional properties. It is similar to Section 1.

Section 5 is the Certification Section. All property owners listed on the deed must sign and date the application.

Before mailing the application, review the Checklist at the end to ensure you do not forget to send the required documents with the application.

Service Connected Disability Ratings

Veterans who have service-connected disabilities often have rating changes. In some cases, the veteran’s illness becomes more severe—in which case, the VA increases the service-connected rating percentage. In other cases, treatment might have cured the veteran, so the rating decreases.

Since the property exemption for service-connected veterans is based on the veteran’s disability percentage, you must notify the Department of Finance when your rating changes. Download the form, complete it, then, mail it and any documentation required showing the rating change to NYC Department of Finance, PO Box 311, Maplewood, NJ 07040-0311.

If you have trouble completing the forms or need to appeal a decision, contact a veterans’ benefits attorney as soon as possible.