PROPERTY TAX; TAX EXEMPTIONS; VETERANS' AFFAIRS;

TAX EXEMPTIONS - VETERANS;

You asked whether PA 03-44 imposed income limits on the optional property tax exemption that municipalities may provide to veterans and their surviving spouses under CGS § 12-81f, or merely modified the limits.

SUMMARY

The municipal option exemption has been subject to income limits since it was established in 1982. PA 03-44 increased the income limits and the size of the maximum exemption municipalities can grant. Under other laws, municipalities must give all veterans and their surviving spouses smaller exemptions. PA 03-44 does not affect the mandatory exemptions.

In addition, another act (PA 03-85) makes all veterans who have 90 days of active service since August 2, 1990, eligible for the optional and mandatory property tax exemptions as well as educational and other benefits. Under prior law, only such veterans who served during (and in some cases, in) specific conflicts or operations during this period were eligible for such benefits. Veterans of World War II, Korea, and Vietnam and certain other conflicts are also eligible for these benefits.

VETERANS’ PROPERTY TAX EXEMPTIONS

Mandatory Exemptions

The law requires municipalities to provide a property tax exemption for all veterans and their surviving spouses. CGS § 12-81 exempts $ 1,000 of the property owned by a veteran or his surviving spouses and requires larger exemptions for disabled veterans and their surviving spouses. CGS § 12-81g, requires an additional exemption of double the basic exemption for veterans whose income falls under certain limits and increased the exemptions by 50% for veterans whose income exceeds these limits. The limits are currently $ 26,100 for a single veteran or a survivor of a veteran and $ 31,900 for married veterans. Thus, a non-disabled veteran or his survivor whose income is under these limits is entitled to a $ 3,000 exemption; if his or her income is above the limits the exemption is $ 1,500.

By law, (1) the limits must be adjusted annually to reflect the increase in Social Security benefits and (2) the exemptions must be increased to reflect increases in taxable grand list following revaluation.

Optional Exemptions and PA 03-44

In addition to these mandatory exemptions, municipalities may provide a larger exemption to veterans and their surviving spouses whose income falls below specified limits. Prior to this year, these limits were the same as those described above. PA 03-44 raised the limits by $ 25,000, to $ 51,100 for a single veteran or a survivor of a veteran and $ 56,900 for a married veteran. By law, the exemptions must be increased to reflect increases in taxable grand list following revaluation.

In addition, the act increased the maximum exemption. Under prior law, municipalities could exempt up to $ 10,000 of the property’s value. The act alternatively allows the municipality to set a maximum exemption of up to 10% of the property’s value. Thus, under prior law, a veteran whose house was worth $ 200,000 was eligible for an exemption of up to $ 10,000; the act increases the maximum exemption in this case to $ 20,000.

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