South Dakota Disabled Veteran Property Tax Exemption

Section 10-4-40 exempts two hundred thousand dollars of the full and true value of a dwelling classified as owner-occupied, owned and occupied by a veteran who is rated as permanently and totally disabled from a service-connected disability. It is an exemption of value, not a credit against the bill, so what it is worth is $200,000 multiplied by the local mill rate. In most of South Dakota that lands somewhere between two and three thousand dollars a year. The figure moved recently and the old one is still in circulation. House Bill 1082 of 2024 raised it from one hundred fifty thousand to two hundred thousand, effective for taxes payable in 2025. The bill as introduced said two hundred fifty thousand and added an annual consumer price index escalator; the House committee struck the "fifty" and the Senate Taxation committee struck the escalator, so the law is a flat $200,000 that does not index. Any source quoting $250,000, or describing the exemption as inflation-adjusted, is describing a bill rather than a statute. The gate is the part that is most often stated wrong, including by the state. The statute says "permanently and totally disabled", and permanent and total is a VA finding distinct from a hundred percent rating. A veteran rated 100 percent on a condition VA expects to improve is not permanent and total; a veteran paid at the total rate through individual unemployability whom VA has found permanently unemployable is. The Department of Revenue's own pages disagree with each other on this: the relief programs page says "permanently and totally disabled as a result of a service-connected disability", tracking the statute, while the deadline entry on the department's calendar says "permanently and 100% disabled". A veteran holding a permanent and total determination at less than a hundred percent schedular should be reading the statute, not the calendar. The deadline is November 1, to the local county assessor, on a form prescribed by the secretary of revenue. Both the application and the supporting documents are confidential, which is not the rule everywhere; North Dakota's equivalent affidavit is open to public inspection by statute. Two ways back in after a missed deadline, and they are not the same strength. If the veteran simply missed the owner-occupied classification deadline or the exemption deadline, the board of county commissioners may recalculate and may abate or refund under chapter 10-18. That is discretionary. But House Bill 1193 of 2026 added a second paragraph for the case that actually happens: where the only thing the veteran failed was the deadline because the permanent and total claim was still pending at VA, the board must abate or refund the difference accumulated since the effective date of the claim, up to the previous four years. A veteran whose rating came through in 2026 with a 2023 effective date has a mandatory four-year look-back, not a request. Once granted, the exemption does not need to be reclaimed. If the director of equalization determines the veteran qualifies, the veteran keeps it until the property is transferred, the veteran stops occupying the dwelling, or the use changes. A change to the legal description does not end it so long as the veteran still lives there. The property has to carry the owner-occupied classification under 10-13-39 to 10-13-40.4, so the exemption and that classification move together. A veteran who loses owner-occupied status loses this exemption with it.