New Hampshire Optional Tax Credit for Combat Service

RSA 72:28-c is aimed at the currently serving Guard member or reservist rather than at the veteran, and it is built around the deployment year. The amount, on adoption by the town under RSA 72:27-a, is "an amount from $50 up to $500" in the version effective until April 1, 2027, and "from $50 up to $750" in the version effective April 1, 2027 from 2026 chapter 96. The statute prints both. RSA 72:27-a, IV means the higher ceiling reaches a town only after that town votes again. It comes off the property tax on the qualifying service member's residential real estate, as defined in RSA 72:29, II. Eligibility, from paragraph III, is a resident "engaged at any point during the taxable period in combat service as a member of the New Hampshire national guard or a reserve component of the United States armed forces, called to active duty". So the active component is outside this section, and the member must have been called to active duty rather than on drill status. "Combat service" is defined by reference to the federal tax rules, which is a sensible choice because it means the proof already exists: the section adopts Internal Revenue Service Publication 3, the Armed Forces Tax Guide, and names three areas. An active combat area designated by the President in an executive order, for which the member receives special pay for duty subject to hostile fire or imminent danger as certified by the Department of Defense. A support area designated by the Department of Defense in direct sustainment of operations in the combat zone, on the same hostile fire or imminent danger pay condition. And service in a contingency operation designated by the Department of Defense, again on the same pay condition. Read the common thread: in all three, the member must actually be receiving hostile fire or imminent danger pay, certified by the Department of Defense. A deployment inside a designated zone without that pay does not satisfy the section on its words. The application procedure is the part that makes this credit usable and it is the only exception of its kind in the chapter. RSA 72:33, I-b: "Notwithstanding the April 15 application deadline in paragraph I, a person may apply for the tax credit for combat service under RSA 72:28-c at any point during the tax year in which the person is engaged in combat service." If the application is granted after the tax rate is set, the credit applies to the balance of tax payments due that year. If the member is found eligible after the taxes for the year of service have been billed and paid, the credit is applied the following year. A member who deploys in August does not lose the year. Paragraph IV requires the application to be accompanied by the member's military orders and whatever the assessor's office needs to verify the dates of combat service. Paragraph V does two things. It makes the credit exclusive: it is "in lieu of, and not in addition to" the optional veterans' credit under RSA 72:28 or the all veterans' credit under RSA 72:28-b. And it sets the timing: the member is eligible in each tax year in which the combat service occurs, "but the credit may be prorated in the second tax year based on the duration of combat service." A deployment spanning two tax years produces a full credit in the first and a proportionate one in the second, at the town's discretion. What this credit does not do is continue after the deployment. It is tied to combat service during the taxable period, so the year after the member comes home they revert to whichever of RSA 72:28 or 72:28-b their town has adopted and they qualify for.