House committee substitute to the 1st edition makes the following changes.
Amends the amount of the property tax homestead exclusion for disabled veterans, under GS 105-277.1C, so that it is the first $61,000 of appraised value of the residences (was, first $45,000 of appraised value of the residence under current law and other specified amounts under the 1st edition). Removes the proposed changes to the definition of disabled veteran and instead makes a technical change. Reinstates the provision allowing a veteran to establish entitlement to homestead exemption as a qualifying veteran under the statute by either (1) establishing permanent and total service connected disability by the VA or (2) establishing receipt of adaptive housing under 38 USC 2101 due to blindness or other permanent and total disabilities. Reinstates the provision prohibiting the amount of the exclusion allowed to all the co-owners from exceeding the exclusion allowed under the statute. Amends the act's long title.
Bill Summaries: H118 (2025-2026 Session)
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Bill H 118 (2025-2026)Summary date: Mar 18 2025 - View summary
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Bill H 118 (2025-2026)Summary date: Feb 13 2025 - View summary
Under current law, the property tax homestead exclusion for disabled veterans, set at the first $45,000 of appraised value of the residence, is excluded from taxation. Revises the property tax homestead exclusion for disabled veterans under GS 105-277.1C, so that the value of the exclusion is set as follows for the following claimants:
- Disabled veteran exclusion. – For a disabled veteran, the exclusion amount is the product of (i) the appraised value of the residence and (ii) the percentage of the qualifying owner's disability rating, as determined by the United States Department of Veterans Affairs.
- Surviving spouse exclusion. – For the surviving spouse of a disabled veteran, the exclusion amount is equal to the greater of (i) the amount excluded under the disabled veteran exclusion explained above as of the date of the disabled veteran's death or (ii) the first $45,000 of appraised value of the permanent residence, provided that the applicant establishes eligibility for such exclusion by providing certification from the United States Department of Veterans Affairs that, as of January 1 preceding the taxable year for which the exclusion is claimed, the veteran's death was the result of a service-connected condition. (Current law allows a surviving spouse to provide such certification from another federal agency as well.) Makes conforming changes to the definition of disabled veteran.
Streamlines the disability component of the definition of disabled veteran so that a veteran only has to show that they have been assigned a disability rating of 50% or greater for service-connected disability by certification from the US Department of Veterans Affairs. (Currently, veteran can establish entitlement to homestead exemption as a qualifying veteran under the statute by either (1) establishing permanent and total service connected disability by the VA or (2) establishing receipt of adaptive housing under 38 USC 2101 due to blindness or other permanent and total disabilities). Makes organizational and conforming changes. Effective for taxes imposed for taxable years beginning on or after July 1, 2025.