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Volume 1 - Opinions of Counsel SBEA No. 109

Opinions of Counsel index

Aged exemption (income) - Real Property Tax Law, § 467:

Dependency and indemnity compensation paid to the parent of a deceased veteran should be considered in the same category as social security and retirement benefits and, therefore, must be included in computing income for purposes of the aged exemption provided by section 467 of the Real Property Tax Law.

Our opinion has been requested as to whether dependency and indemnity compensation paid to the parent of a deceased veteran is to be included in computing income for purposes of section 467 of the Real Property Tax Law, which authorizes a partial exemption on real property owned by certain elderly persons.

Subdivision 3(a) of section 467 provides that no exemption may be allowed where the income of the owner or owners (and spouse) of the property does not exceed a sum to be set at any figure between $3,000 and $5,000 by the locality granting the exemption. It further provides that “income shall include social security and retirement benefits, interest, dividends, net rental income, salary or earnings, and net income from self-employment, but shall not include gifts or inheritances.” The only specific exclusions from income are gifts and inheritances. Therefore, the apparent intent of the Legislature was to include all other income including the items specifically enumerated in the exemption statute.

Dependency and indemnity compensation, authorized under Chapter 13 of Title 38 of the United States Code, is a monthly benefit payment to a dependent widow, child or parent of a deceased veteran whose death was service connected. To receive such benefits the recipient must establish that he or she was dependent upon the deceased veteran for support. Where a deceased veteran had not been fully and currently covered under the Federal Social Security Act prior to his death, dependency and indemnity compensation benefits may be paid to his dependents in lieu of social security benefits to which the dependents might otherwise be entitled (United States Code, Title 38, section 412).

Dependency and indemnity compensation cannot be categorized as a gift or an inheritance. It properly should be considered in the category of social security and retirement benefits. Accordingly, it is our opinion that dependency and indemnity compensation benefits, authorized under Chapter 13 of Title 38 of the United States Code and paid to an applicant for the partial exemption authorized by section 467 of the Real Property Tax Law, must be included in computing income for purposes of that exemption statute.

April 27, 1972

Updated: