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Volume 5 - Opinions of Counsel SBEA No. 64

Opinions of Counsel index

Veterans exemption (eligible funds) (subsistence allowance - portion of educational costs paid by employer) - Real Property Tax Law, § 458:

Where a veteran receives an educational allowance from the government, that portion of the educational benefits not actually used for tuition, books, fees, etc. constitutes a subsistence allowance. Where the veteran’s employer pays a portion of the veteran’s tuition, the veteran’s educational costs are reduced, thereby leaving him a greater amount of subsistence allowance, a portion of which constitutes eligible funds for purposes of section 458 of the Real Property Tax Law.

We have received an inquiry concerning the veterans’ exemption (Real Property Tax Law, §458). The facts are that a veteran received an educational allowance from the government and his employer has paid a portion of the veteran’s tuition. The question is whether the amount of the tuition paid by the employer should be deducted from the educational costs of the veteran in computing his exemption.

We have previously indicated that a portion of an educational allowance (i.e., subsistence allowance) may constitute eligible funds for purposes of the veterans’ exemption in a limited amount (see, 1 Op.Counsel SBEA No. 29, 3 Op.Counsel SBEA No. 6). The method by which such exemption is calculated is described in the above opinions and in item III.A.10 of our pamphlet on section 458 entitled “Veterans’ Exemption From Real Property Taxes” (EA P-l (1-15-74)). The final sentence of that item states, “Post-World War II veterans do not receive separate subsistence allowances and any portion of education or training benefits not actually used for tuition, books, supplies, fees, etc. is considered a subsistence allowance and is treated in the manner described in this paragraph[.]” That is, educational allowance minus educational costs equals subsistence allowance.

Since any portion of an educational allowance received by a veteran but not actually used for tuition, etc. should be treated as subsistence allowance moneys, if the veteran paid a portion of his tuition with moneys received from his employer for that purpose, his educational costs would be reduced, thereby leaving him a greater subsistence allowance. How much of the subsistence allowance moneys constitutes eligible funds is determined in accordance with the rules set forth in the aforementioned opinions and pamphlet.

April 29, 1976

Updated: