Disabled Veterans' Exemption

Under Revenue and Taxation Code 205.5, any property real or personal that constitutes the principal place of residence of a disabled veteran, who has received a 100% service-connected disability rating or who has less than 100% but is compensated at 100% due to unemployability from the Veterans Administration is eligible for this exemption. 

At this time, SB 296 has not passed and does not change California property tax exemptions. The Disabled Veterans' Property Tax Exemption remains the same, and the Assessor's Office must apply current state law. Some information online refers to federal benefits, which are separate from state property taxes.

To Qualify for the Disabled Veterans' Exemption, the following conditions must be met:

• You must be a veteran who, due to a service-connected injury or disease incurred in military service, is blind in both eyes, or has lost the use of two or more limbs, or is totally disabled. Totally disabled for purposes of the exemption means the United States Department of Veterans Affairs (USDVA) or the military service from which the veteran was discharged has rated the veteran’s disability at 100 percent or the veteran’s disability compensation at the 100 percent rate by reason of being unable to secure or follow a substantially gainful occupation (individual unemployability); or  
• You must be an unmarried surviving spouse of a deceased veteran who qualified for the exemption in their lifetime or died from a service-connected injury or disease or would have qualified for the exemption 
• The veteran must not have been discharged from military service under “dishonorable” conditions.
• You must own and occupy the dwelling as your principal residence as of January 1 of each year to qualify for the exemption for that year. Note: If you are confined to a hospital or other care facility, and the property would be your principal place of residence were it not for your confinement, the home continues to be eligible for exemption as long as it isn’t rented out.

 The exemption amount is set annually by the State Board of Equalization but can also be based on the value of the ownership interest in the property of the veteran and spouse if there is other non-qualified ownership interest. The date of enrollment of the exemption is the effective date of disability from the Veterans Administration, date of acquisition, or date of occupancy. 

Please note: the amount of the exemption may never exceed the assessed value of the claimant's residence.

Forms:

• Disabled Veterans' Property Tax Exemption BOE-261-G (PDF) (For first filing and annual low income filing)
• Disabled Veterans' Household Income Worksheet (PDF)
• Disabled Veterans' Exemption Change of Eligibility Report BOE-261-GNT (PDF)

Please mail the completed claim form and supporting documents to the address on the claim form, or visit our office Monday – Friday 8am-5pm where we can assist you in making copies and completing the forms. Claim forms submitted must have a wet signature only/No Electronic Signatures are accepted at this time in Nevada County.

Two Exemption Levels:

Basic exemption is a one-time filing and has no income requirement.

To apply for this exemption you must submit:

1. A completed Claim for Disabled Veterans’ Property Tax Exemption BOE-261-G form
2. A complete copy of the Veteran’s Rating Decision Letter from the Department of Veterans’ Affairs with the effective date of the 100% service-connected rating or unemployability
3. A copy of the veteran’s DD214 showing discharged in other than dishonorable conditions
4. If married, a copy of your Marriage Certificate
5. A copy of the Veteran’s ID 

An eligibility form will be sent annually to report any changes to the claimant’s: 

• Disability Rating
• Principal Residence
• Marital Status

If there are no changes, you are not required to return the change in eligibility form.

Low-income exemption based on your total household income (requires annual filing each year by February 15)

The Low-Income level requires an initial claim form, supporting documents listed above and an itemized household income worksheet reflecting income that falls below the income limit set by the State. All sources of household income are to be reported which includes but not limited to: taxable and non-taxable wages, retirement, disability compensation, Social Security (including Medicare premiums), gifts, inheritances, sales of capital assets, life insurance proceeds, interest and dividends from investments and compensation from the Veterans Administration.

To continue the low-income exemption annually, a claim form and income worksheet must be submitted every year and received by our office or postmarked by 5:00 p.m. February 15th. If the form and worksheet is not received, the exemption will be reduced to the Basic level. A portion of the eligible Low-Income exemption is eligible if filed after February 15th. 

If you do not have copies of your ratings letter or discharge, Please contact Veterans Services at (530) 273-3396.

Surviving Spouse

An Unmarried Surviving Spouse may initially file or continue an existing exemption by filing a claim form naming themselves as the claimant and naming the deceased qualifying veteran and attaching the following supporting documents:

• Marriage Certificate
• Death Certificate
• Dependents Indemnity Compensation (DIC) letter from the Veterans Administration or Veteran’s Rating Decision letter
• DD214 (for first time Surviving Spouse Claimants only)
• Household Income Worksheet (if applying for the Low Income Exemption)

As shown in the following chart, both exemption and income eligibility amounts are compounded annually by an inflation factor.

Exemption Amounts and Household Income Limits for Current and Prior Years

 *Based on a tax rate of 1.2%, actual tax rates may vary

When to file for this exemption:

• A qualified applicant must file by the end of the calendar year for the tax year in which they intend to seek relief on the annual tax bill. For example, an applicant who receives their VA rating letter dated in April 2020 must file an exemption claim by December 31, 2020 in order to be considered timely.
• Claims received after these dates are still eligible for exemption, but at a reduced exemption amount for the initial filing.
• Low-income exemptions require an annual claim filing by February 15 each year (the basic exemption is a one-time filing; no annual claims are required after the initial filing).

Retroactive Filings

California law allows for retroactive filings, in some cases, up to a total of eight years.

Potential for Tax Savings

Property taxes are based on the assessed value of your property. The Disabled Veterans’ Exemption reduces your property taxes by deducting the amount of the applicable exemption from your property’s assessed value before applying the tax rate. Generally, given the one percent statewide property tax rate, the tax savings would equate to one percent of the exemption amount. Depending upon the amount of local voter-approved bonds in your area, if any, the overall tax rate could be higher than one percent, which would increase your tax savings. For example, if your overall tax rate is 1.17% for the 2023-24 fiscal year assessment, the tax savings would be $1,885 ($161,083 x .0117) for the basic exemption or $2,827 ($241,627 x .0117) for the low-income exemption.

Related Information

• CA Board of Equalization 
• CA Board of Equalization FAQs
• Taxpayers' Rights Advocate: Disabled Veterans' Exemption