Assessor Manuals, Exemption Administration: RPTL Section 458-a
Section 4.01 - RPTL Section 458-a: Veterans (Alternative exemption for wartime veterans)
|Exemption code||Description of code|
|4112_||Wartime veteran, non-combat zone|
|4113_||Wartime veteran, combat zone|
|4114_||Wartime veteran, disabled|
Note: If a veteran has been granted a disability exemption, two codes are necessary (either 4112_ or 4113_ and 4114_).
Year Originally Enacted:
RPTL §458, RPTL §458-b
The primary residence of (1) a veteran of the United States Armed Services who actively served during a period of war, (2) a veteran who received an expeditionary medal, or under certain conditions: (3) a veteran of the merchant marine service, (4) a veteran of the American Field Service, or (5) a veteran who served as a Pan American World Airways flight crew and aviation ground support employee may be eligible for partial exemption from general municipal taxes. No exemption is allowed for special ad valorem levies or special assessments. County, city, town and village taxing jurisdictions had the option of disallowing the exemption or allowing it at a reduced or increased level. Jurisdictions which allow the alternative veterans' exemption may not grant any new eligible funds (former RPTL §458(1)) or original option pro rata veterans' exemptions (former RPTL §458(5)) after March 2, 1986. In addition, school districts now have the option of allowing this exemption.
The percentage exemption that applies to the assessed value of a qualifying property depends on both the nature of the veteran's service and the local law adopted by the taxing jurisdiction. Veterans who were on active duty during a period of war are eligible for a 15% exemption (not to exceed a basic state maximum of $12,000 or the product of $12,000 multiplied by the latest state equalization rate, special equalization rate, or in the case of a special assessing unit, the latest class ratio, whichever is less). An additional exemption of 10% (not to exceed a basic state maximum of $8,000 or the product of $8,000 multiplied by the latest state equalization rate, special equalization rate, or in the case of a special assessing unit, the latest class ratio, whichever is less) is available for those who served in combat zones. Veterans who sustained service-related disabilities, as evidenced by receipt of disability compensation rating from the Veterans Administration or the Department of Defense are eligible for a percentage exemption equal to one-half of their disability rating (not to exceed $40,000 or the product of $40,000 multiplied by the latest state equalization rate, special state equalization rate, or in the case of a special assessing unit, the latest class ratio, whichever is less) in addition to the wartime and combat zone exemptions. Veterans who died in service of a service-connected disability are considered to have a disability rating of 100%.
A taxing jurisdiction which allows the alternative veterans' exemption has the further option of using one of the following ten (or sixteen, in the case of a high appreciation municipality) reduced or increased maximum exempt amounts (or the product of such a reduced or increased amount multiplied by the latest state equalization rate, special equalization rate or, in the case of a special assessing unit, the latest class ratio, whichever is less) instead of the maximum amounts authorized by state law:
|Reduced maximum pursuant to local law||$6,000||$4,000||$20,000|
|State law basic maximum||$12,000||$8,000||$40,000|
|Increased maximums pursuant to local law||$15,000||$10,000||$50,000|
In high appreciation municipalities the governing board may adopt still higher maximum limits of:
A high-appreciation municipality means: (1) New York City, (2) a county for which the Office of Real Property Tax Services (ORPTS) has established a sales price differential factor for purposes of the school tax relief [STAR] exemption (Real Property Tax Law, sec. 425) for three consecutive years, or (3) a city, town, village or school district which is wholly or partly located within such a county.; (see STAR differentials for a list of such counties.)
Thus the maximum exemption allowed is 75%, where a veteran served during a period of war in a combat zone and has a 100% service-connected disability rating.
When §458-a, the alternative veterans' exemption, was enacted in 1984 and subsequently became effective in many taxing jurisdictions, some veterans in these jurisdictions who already had eligible funds exemptions under §458 chose to switch to the alternative exemption. Other veterans chose to keep their eligible funds exemptions, and some of these veterans, in certain revaluation situations, were granted pro rated exemptions under former §458(5). In 1994, the pro rata exemption was repealed and a new §458(5) enacted authorizing, at local option, a change in level exemption instead. Current §458(5) also allows those taxing jurisdictions which both allow alternative veterans' exemptions and enact a local law adopting the change in level exemption to include in their law a provision that allows veterans who once had an eligible funds exemption but later switched to the alternative veterans' exemption to switch back to the eligible funds exemption, thereby qualifying them for change in level exemptions. For details on the change in level exemption and its administration, see RPTL §458.
Note: School districts may now offer the eligible funds exemption (RPTL §458). However, where a school district has adopted the alternative veterans’ exemption, but not the eligible funds exemption, a veteran who receives the eligible funds veterans’ exemption may apply for the alternative veterans’ exemption solely to receive it for school purposes while continuing to receive the eligible funds exemption for county, city, town, and/or village purposes.
The property must be owned by a qualified owner , namely a veteran, the spouse of a veteran or the unremarried surviving spouse of a veteran. Where property is owned by more than one qualified owner, the exemption to which each is entitled may be combined. Also, a qualified owner includes a Gold Star Parent (defined as the parent of a child who died in the line of duty while serving in the United States Armed Forces during a period of war), where allowed by local option. The ownership requirement is also satisfied if the veteran, the veteran's spouse, the veteran's unremarried surviving spouse, or, if allowed by local option, the Gold Star Parent is the legal life tenant of the property. If the title has been transferred to a trust, the property is eligible for the exemption if the trustees or trust beneficiaries otherwise qualify.
If the veteran dies and there is no unremarried surviving spouse, the property may qualify for exemption if title to the property is vested in the veteran's dependent child or children under the age of 21 years or dependent parent(s), provided that the dependent uses the property as his primary residence. A veteran who is also the unremarried surviving spouse of a veteran may receive any exemption to which the deceased spouse was entitled.
A veteran is defined as any of the following:
- A person who served in the active military, naval, or air service of the U.S. during a period of war (Spanish-American War, Mexican Border War, World War I, World War II, Korean War (6/27/50 - 1/31/55), Vietnam War (11/1/55 - 5/7/75), or Persian Gulf conflict (on or after 8/2/90) and must have either (1) been honorably discharged or released from service or (2) received a letter from the NYS Department of Veterans’ Services (DVS) stating that the veteran now meets the character of discharge criteria for all of the benefits and services listed in the Restoration of Honor Act.
- A person who was awarded an Armed Forces Expeditionary Medal, a Navy and Marine Corps Expeditionary Medal, or a Global War on Terrorism Expeditionary Medal and who was discharged or released under honorable conditions.
- A crew member of the merchant marine who served during World War II and (1) was employed by the War Shipping Administration or Office of Defense Transportation or their agents as a merchant seaman as documented by the U.S. Coast Guard or Department of Commerce or as a civil servant employed by the U.S. Army Transport Service or the Naval Transportation Service, (2) served satisfactorily as a crew member during World War II (December 7, 1941 to August 15, 1945) aboard (a) a merchant vessel in oceangoing (foreign, intercoastal, or coastwise) voyages or near foreign voyages between the U.S. and Canada, Mexico, or the West Indies via ocean routes or (b) a public vessel in oceangoing service or foreign waters, and (3) received a Certificate of Release or Discharge from Active Duty and a discharge certificate, or an Honorable Service Certificate/Report of Casualty from the Department of Defense.
- An American Field Service member who served during World War II and (1) was employed by the American Field Service, (2) served overseas under U.S. Armies and U.S. Army Groups in World War II (December 7, 1941 to May 8, 1945), and (3) was discharged or released therefrom under honorable conditions.
- A United States civilian who (1) served overseas as a flight crew and aviation ground support employee of Pan American World Airways or one of its subsidiaries or affiliates as a result of Pan American's contract with Air Transport Command or Naval Air Transport Service during World War II (December 14, 1941 to August 14, 1945) and (2) was discharged or released therefrom under honorable conditions.
- A member of one of the reserve components of the U.S. armed forces who received an honorable discharge or release therefrom under honorable conditions, but is still a member of the reserve component may be granted the alternative veterans exemption provided that such a member meets all other qualifications for receiving the exemption.
- If allowed by local option in a county, city, village or school district, a veteran includes those military personnel who served in the Reserve component of the United States Armed Forces that were deemed on active duty under Executive Order 11519, dated March 24, 1970, designated as Operation Graphic Hand, if such member was discharged or released therefrom under honorable conditions, provided that such veteran meets all other qualifications for the exemption. (Please see section B. Local Option below)
Property location requirements:
Property use requirements:
The property must be used exclusively for residential purposes. It must also be the primary residence of the veteran the unremarried surviving spouse of the veteran, or, if allowed by local option, a Gold Star Parent, unless that person is absent from the property due to medical reasons or institutionalization. In the event that a portion of the property is not used exclusively for residential purposes, that portion is not entitled to the exemption. In such cases, the assessor may apportion the assessed value and apply the exemption only to the residential portion of the property.
Certification by state or local government:
Required construction start date or other time requirement:
Yes; each county, city, town, and village originally had the option to disallow the exemption. This option had to be exercised through adoption of a local law no later than 90 days prior to the 1985 taxable status date in the jurisdiction. The local law may be repealed if at a later date the jurisdiction decides to allow the exemption. In addition, school districts are now authorized to allow the exemption, by resolution after a public hearing. Or in the case of a city with a population of one million or more, the passage of a local law by the local legislative body.
Limit of exemption:
A jurisdiction which allows the exemption has the additional option of using the maximum exempt values authorized by state law for the three veterans categories or passing a local law (or in the case of a school district, a resolution) establishing one of the two lower sets of maximum exempt values or one of the eight (or fourteen, in the case of a high-appreciation municipality) higher sets (see Summary above).
Gold Star Parents:
A jurisdiction which allows the exemption has another option of adopting a local law or resolution which extends eligibility to residential property owned by Gold Star Parents, and used as their primary residence. Note that the additional exemption based on a veteran's disability, i.e., 50% of the service-connected disability rating is not available to Gold Star Parents.
Each taxing jurisdiction may adopt a local law, ordinance or resolution to allow that portion of a cooperative apartment corporation held by an otherwise eligible veteran tenant/stockholder to be eligible for an exemption from real property taxes. If allowed, the amount of the exemption must be determined by the assessor, based upon the proportion of the outstanding stock held by the eligible shareholder, and credited against the taxes charged to the corporation. Eligible stockholders would receive an adjustment to their monthly maintenance fees by the cooperative apartment corporation to reflect the benefit of the exemption. However, this exemption may not be granted to apartments subject to the provisions of Private Housing Finance Law Articles 2, 4, 5, or 11.
Each taxing jurisdiction may adopt a local law, ordinance or resolution to allow a transferred prorated exemption to a veteran, the spouse or unremarried surviving spouse of the veteran who sells his or her property upon which he or she has been receiving an exemption under §458-a, and who purchases a replacement property within the same county or in the case of NYC, a city.
Operation Graphic Hand:
A county, city, town, village, or school district may adopt a local law or in the case of a school district, a resolution, to include those military personnel who served in the Reserve component of the United States Armed Forces that were deemed on active duty under Executive Order 11519, dated March 24, 1970, designated as Operation Graphic Hand, if such member was discharged or released therefrom under honorable conditions, provided that such veteran meets all other qualifications for the exemption.
|Taxing Jurisdiction||Amount*||Duration||Special ad valorem levies||Special assessments|
|County or county special district||Exempt**||No limit||Taxable||Taxable|
|City||Exempt**||No limit||Not applicable||Taxable|
|Town or town special district||Exempt**||No limit||Taxable||Taxable|
|school district***||Exempt**||No limit||Not applicable||Taxable|
*See Calculation of exemption below.
**Unless disallowed by local option. If allowed by local option, tax districts may adopt the cooperative apartment provisions of RPTL §458-a(6).
***If allowed by local option.
Payments in lieu of taxes
Calculation of exemption
General Municipal and School District Taxes:
Non-combat zone veteran without disability rating
The lesser of either 15 percent of assessed value or the maximum exemption level adopted by the taxing jurisdiction, multiplied by the latest state equalization rate (or special equalization rate), or in the case of a special assessing unit, the latest class ratio (see maximum exemption amounts in Summary)
Combat zone veteran without disability rating
The lesser of either 25 percent of assessed value or the maximum exemption level adopted by the taxing jurisdiction, multiplied by the latest state equalization rate (or special equalization rate), or in the case of a special assessing unit, the latest class ratio (see maximum exemption amounts in Summary)
Non-combat zone veteran with disability rating*
the exempt amount determined in above plus the lesser of either (1) 1/2 of the disability rating multiplied by the assessed value or (2) one of the following dollar amounts multiplied by the latest final state equalization rate (or special equalization rate) or class ratio: (see maximum exemption amounts in Summary)
Combat zone veteran with disability rating*
the exempt amount determined in step b. above plus the lesser of either (1) 1/2 of the disability rating multiplied by the assessed value or (2) one of the following dollar amounts multiplied by the latest final state equalization rate (or special equalization rate) or class ratio: (see maximum exemption amounts in Summary)
Exemption for eligible tenant/shareholders of cooperative apartment corporations
Exemption = Assessed Value x (n/N) x W.S.
where n = number of shares owned by eligible veterans
N = total number of corporation shares
W.S. = Percent of exemption due to wartime service determined above
Exemptions may not exceed the maximums established by local law.
Transfer and pro-ration of exemption: Proration of the exemption on the replacement property is based on the date during the fiscal year the veteran obtains title to the new property, and is calculated by multiplying the tax rate or rates for each municipality that has levied taxes for that fiscal year times the exempt amount on the former property, then times the fraction of each fiscal year remaining following the date the replacement property is acquired.
Special ad valorem levies and special assessments:
No exemption allowed.
1. One of the following should be entered as the last digit of the exemption code:
- Exempt from county and city/town taxes
- Exempt from county taxes only
- Exempt from city/town taxes only
2. If a veteran has been granted a disability exemption, two codes are necessary (either 4112 or 4113 and 4114 ).
Assessment roll section:
Taxable (RPS Section 1).
Filing requirements (owner or occupant of property):
File Form RP-458-a, Application for Alternative Veterans' Exemption from Real Property Taxation. Veterans have the option of re-filing if changes have occurred that affect qualifications for an increased or decreased amount of exemption, other than changes in disability ratings.
Notes: (a) If more than one veteran owner of a single property applies for exemption under RPTL §458-a, each owner must file a separate application form.
(b) No application form is required in applying for a prorated exemption. However, to continue receiving the exemption beyond the fiscal year in question, the owner must re-file Form RP-458-a.
File Form RP-458-a-Dis, Renewal Application for Alternative Veterans' Exemption from Real Property Taxation Based on Service Connected Disability Compensation Rating
Note: Renewal application is only required if the disability rating is increased or decreased.
Reporting requirements (assessor)
Exemption application forms
Please send general questions or comments to ORPTS.