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Volume 5 - Opinions of Counsel SBEA No. 102

Opinions of Counsel index

Veterans’ exemption (eligible funds) (unemployment insurance) - Real Property Tax Law, § 458:

Unemployment insurance benefits paid by the United States government to Viet Nam veterans, who were unable to find work upon discharge from service, constitute “eligible funds” for purposes of the veterans’ exemption (Real Property Tax Law, §458).

Our opinion has been requested as to whether unemployment insurance paid by the United States government to Viet Nam veterans, who were unable to find work upon being discharged from service, constitutes eligible funds for purposes of the veterans’ exemption statute (Real Property Tax Law, §458).

It is our understanding that the unemployment compensation referred to above is available to a veteran where unemployment occurs after his release from service and if he meets the eligibility conditions required by the state in which he makes his claim. It is our opinion that such unemployment compensation is in the nature of insurance and, would be included within the phrase “insurance. . .granted by the United States. . .” (Real Property Tax Law, §458(1)), and is therefore “eligible funds” within the meaning of this section. Thus, if the applicant is able to substantiate that he has preserved these payments and used such moneys in the purchase of real property, the exemption should be granted to the extent of the moneys so used.

It should be kept in mind, however, that the mere receipt of these funds does not entitle the veteran to the exemption and that the use of the funds in the purchase of real property must be substantiated.

The very nature and purpose of this unemployment compensation (i.e., to relieve somewhat the distress of the unemployed worker and his family which follows involuntary unemployment), together with the fact that the unemployment must occur in the year following release, places a heavy burden of proof upon the applicant. Indeed, unless the applicant can show a purchase of the property at about the time the funds were received, the assessor would be justified in assuming that such funds were used by the veteran for the purpose for which they were intended.

We have advised veterans’ counselors to inform veterans who intend to preserve such moneys for the purpose of purchasing real property to make deposits in a bank account in order to be able to demonstrate to the assessor at a later date that the total amount claimed as having been used in the purchase of real property was on hand at all times during the existence of this account (see, 1 Op.Counsel SBEA No. 1).

November 17, 1976

Updated: