Illinois Standard Homestead Exemption for Veterans with Disabilities

Illinois cuts equalized assessed value rather than exempting a dollar of tax, so what the exemption is worth depends on the local rate. Section 15-169 of the Property Tax Code sets three bands, keyed to the service-connected disability percentage VA certifies: At least 30% but less than 50%: $2,500 reduction in EAV. At least 50% but less than 70%: $5,000 reduction in EAV. 70% or more: the first $250,000 of EAV is exempt from taxation. That top band is often described as a total exemption, and for most homes it is, but the statute states it as the first $250,000 of EAV rather than an unlimited one. Before tax year 2023 a home with an EAV of $250,000 or more did not qualify at all; since 2023 the definition of qualified residence has no value limit, so a more valuable home gets the first $250,000 exempt and pays on the rest. The part used for commercial purposes, including units rented for more than six months, is left out. Because EAV in Illinois generally runs at about a third of market value outside Cook County, the ceiling corresponds to a fairly expensive home. Since tax year 2023 the section also defines a veteran as an Illinois resident who served in the armed forces, on State active duty, in the Illinois National Guard or in the reserves and who has a VA-certified service-connected disability for which the veteran receives compensation. The earlier requirement of an honorable discharge is gone, and the rating is read as of the date of the application. A rating below 30% gets nothing under this section. The surviving spouse provisions are unusually layered. An unmarried surviving spouse may continue the exemption on the veteran's primary residence, and may carry it to a different primary residence after the original is sold. Since tax year 2023 the veteran need not have claimed it first: a spouse who has lived in Illinois since the veteran's death qualifies if the veteran would have qualified that year. For tax year 2015 and after, the surviving spouse of a veteran killed in the line of duty receives a 100% reduction in EAV. For tax year 2023 and after, a surviving spouse certified by VA as receiving Dependency and Indemnity Compensation for a service-connected death qualifies for the $250,000 exemption. And for tax year 2024 and after, the property of a World War II veteran is exempt regardless of the disability level. The requirement that catches people is annual. This exemption is not granted once and left alone: section 15-169(e) requires the veteran to reapply every year, on form PTAX-342-R after the initial PTAX-342 application, and a veteran who files once and assumes it renews will lose it. There are two exceptions. A World War II veteran need not reapply. And since May 23, 2022 (Public Act 102-895), a veteran VA rates 100% service-connected and permanently and totally disabled no longer has to reapply once the exemption is granted. A 2025 bill to exempt every permanent and total veteran's home outright (HB 1308) was re-referred to the Rules Committee and is not law. File with the chief county assessment office. A county Veteran Service Officer will help with the VA certification.