Disabled Veterans Exclusion

In 2008, the Minnesota Legislature enacted a market value exclusion for honorably discharged veterans with service-connected disabilities. This is not a property tax exemption and it is not a tax forgiveness program. Rather, it lowers the property tax liability by subtracting the amount of the exclusion from the assessor’s estimated market value to arrive at a lower taxable market value.

Market Value Exclusions
This program provides 5 different provisions which qualify for the exclusions:

• For veterans with 70% to 100% service-connected disability (PDF), the market value exclusion is up to $150,000 on homestead property
  
  • If this disability is non-permanent, the veteran will need to reapply every year by July 1 for taxes payable in the following year
• For veterans with total (100%) and permanent service-connected disability (PDF) or with permanent individual unemployability, the market value exclusion is up to $300,000 on homestead property
• For surviving spouses of permanently and totally disabled veterans, the market value exclusion is up to $300,000 on homestead property
  • If a property has previously qualified for exclusion based on ownership and occupancy of a permanently and totally (100 percent) disabled veteran and the veteran passes away, a surviving spouse is eligible to continue the exclusion for the taxes payable year of the veteran's death and eight additional taxes payable years after the year of the veteran's death
• For primary family caregivers, the eligible veteran would not own homestead property in Minnesota, but the veteran's primary family caregiver would be eligible for the same benefit as the veteran depending on the veteran's disability rating
• For surviving spouses of service members who die in action, the market value exclusion is up to $300,000 on homestead property for up to five taxes payable years
  
  • A first-time application for exclusion under this provision may be made at any time within 2 years of the death of the service member

Applications are also available at the County Assessor's Office and your Veteran's Service Office.

In addition to the completed application, you must also attach a letter from the Veteran’s Administration, confirming both honorable discharge and disability status.

We urge you to contact your county’s Veterans Service Officer, Donald Dufner for Meeker County, for assistance with completing the application and obtaining the appropriate letter from the Veteran’s Administration office.

Basic Provisions of the Program

• The property must qualify for homestead before being granted valuation exclusion
• For agricultural property, only the house, garage, and immediately surrounding 1 acre of land qualify for the valuation exclusion
• Neither residential nor agricultural homesteaded properties are eligible to receive the homestead market value credit. Excess agricultural land and buildings will continue to receive the agricultural credit
• Relative homesteads do not qualify for this program. A property must be both owned and occupied by a qualifying disabled veteran before being eligible for the market value exclusion