Disabled veterans who own their homes and declare Vermont homesteads may be eligible for a property tax exemption. The exemption reduces the assessed value of the homestead, lowering the veteran’s property taxes.
State law mandates a minimum $10,000 property tax exemption for veterans in both the municipal and education grand list. Cities and towns may vote to increase the exemption up to $40,000 in the municipal grand list. The value of a veteran’s homestead will be reduced by the amount of the exemption. Veterans are eligible for the exemption in one of three circumstances:
- Disability compensation for 50% or higher disability or
- Non-Service connected pension (“improved pension”) or
- Military retirement pay for a permanent medical military retirement
If a veteran’s disability qualifies him/her for this exemption, the federal Department of Veterans Affairs will issue a Summary of Benefits Letter. Submit the current year application that is available on www.veterans.vermont.gov to the Vermont Office of Veterans Affairs by May 1 of each year.
Note: Surviving spouses of veterans who had previously qualified for this exemption may also be eligible if they don’t re-marry.
For more information, see Vermont law at 32 V.S.A. § 3802 and Veterans and Property Taxes: What You Should Know.
For questions regarding the application process and eligibility contact:
Vermont Office of Veterans Affairs
118 State Street
Montpelier, Vermont 05620-4401
Telephone: (802) 828-3379 or (888) 666-9844
Fax: (802) 828-5932
Public, Pious, And Charitable Use Exemption
For the public, pious, or charitable use exemption to apply under the law, the property must meet all the following conditions:
- the property must be dedicated unconditionally to public use;
- the primary use must directly benefit an indefinite class of persons who are part of the public, and must also confer a benefit on society as a result of the benefit conferred on the persons directly served; and
- the property must be owned and operated on a not-for-profit basis.
American Museum of Fly Fishing, Inc. v. Town of Manchester, 151 Vt. 103, 110 (1989)
Taxation of Credit Unions
Credit unions are chartered at either the federal or state level. Federal credit unions are exempt from federal income tax under Internal Revenue Code, section 501(c)(1). State credit unions are exempt from federal income tax under the Internal Revenue Code, section 501(c)(14). Both federal and state credit unions are exempt from Vermont income tax under Vermont law at 8 V.S.A. § 30901. Vermont law exempts federal and state credit unions from some state taxes, except for state and municipal property taxes and personal property taxes.
How To Apply For The Exemption
Your town lister makes the initial determination of whether a property is exempt from tax under the law. You may complete Form PVR-317, Vermont Property Tax Public, Pious, or Charitable Exemption application to present to the lister. The application will help you gather the necessary information the lister needs. It is important that you provide clear and detailed information about the property and its uses. Incomplete information will result in the exemption being denied.