North Dakota Disabled Veterans Property Tax Credit

Section 57-02-08.8 gives a disabled veteran a credit against the property tax on the first nine thousand dollars of taxable valuation of the homestead they own and occupy, equal to the percentage of their service-connected disability rating. At 50 percent the credit reaches $4,500 of taxable valuation, at 70 percent $6,300, at 100 percent the full $9,000. Those are not dollars off the bill and they are not market value, and both misreadings are common. Taxable valuation in North Dakota is nine percent of assessed value under 57-02-27, and assessed value is fifty percent of true and full value under 57-02-01. Residential taxable valuation is therefore four and a half percent of what the house is worth. Nine thousand dollars of taxable valuation is about two hundred thousand dollars of market value, and the money the credit is worth is that much valuation multiplied by the local mill rate. A veteran in a $200,000 house at 100 percent has the whole homestead taken out of the tax base; a veteran in a $400,000 house has half of it taken out. Two routes in. A service-connected disability of fifty percent or greater, or an extra-schedular rating to include individual unemployability which results in the veteran being paid at the one hundred percent rate. The unemployability route is in the operative text, not in a guideline, so a veteran rated below fifty percent schedular and paid at the total rate qualifies on the statute. The service test is a discharge under honorable conditions, or retirement from the armed forces. A medically retired member who was never formally discharged is covered by the second limb. Three arithmetic rules that decide real cases. If two disabled veterans are married to each other and living together, their combined credits may not exceed 100 percent of the $9,000. If a veteran co-owns the homestead with anyone other than their spouse, parent or child, the credit is limited to the veteran's own interest, calculated by multiplying the taxable valuation of that interest by the certified disability percentage. And the credit does not touch special assessments, which in a North Dakota city can be a large part of the bill. The credit terminates at the end of the taxable year in which the applicant dies. A surviving spouse does not inherit it and has to qualify in their own right under the surviving spouse limb of the same section. Applying. The first-time application goes to the local assessor or the county director of tax equalization by April 1 of the year the property is assessed, with an affidavit, a description of the property and a VA certificate of the disability amount. After that the Tax Commissioner's guidance is that the credit is applied automatically to those who qualify, though the assessor may ask for supporting information in later years. One privacy point that is easy to miss: subsection 3 provides that the affidavit and certificate "must be open for public inspection". Section 57-02-08.8(7) is the retroactive route. The board of county commissioners may cancel the portion of unpaid taxes representing the credit for any year in which the qualifying owner held title, based on the law in force for that year. A veteran who was eligible for years and never applied has something to ask the commissioners for rather than a closed door. This credit stacks with the primary residence credit in 57-02-08.9, which is worth up to $1,600 and is applied after other exemptions and credits. The order matters: if the veterans credit has already reduced the tax owed below $1,600, the primary residence credit is capped at the remaining tax and part of it is simply unused.