Veterans Property Tax Exemption in NYC

If you are an honorably discharged veteran who served during a designated conflict period (or a qualifying spouse, unremarried surviving spouse or Gold Star parent) and the NYC home is your primary residence, the Alternative Veterans Exemption cuts its assessed value by 15%, plus another 10% if you served in a combat zone, plus half your VA disability rating. Each piece is capped, there is no income limit, and you apply once to the NYC Department of Finance (DOF) by March 15.

NYC has two veterans exemptions. The Alternative Veterans Exemption is the one almost every veteran applies for today. The older Eligible Funds exemption still exists for veterans who bought their homes with pension, bonus or insurance money. You can only have one at a time.

Who qualifies for the Alternative Veterans Exemption

DOF's rules have three parts: who you are, when you served, and where you live.

Who

• Veterans of the U.S. Armed Forces (or Merchant Marines, per DOF's brochure) discharged under honorable conditions.
• Recipients of an expeditionary medal.
• Spouses of qualifying veterans, and unremarried widows or widowers.
• Gold Star parents.

When you served

*DOF's web page lists the Vietnam era as starting November 1, 1955. Its December 2025 brochure still shows February 28, 1961. If your service falls between those dates, ask DOF to confirm before you rely on it.

Where you live

The home must be the qualifying owner's primary residence. Property owned by a business (such as an LLC) is not eligible. For a trust, only the qualifying beneficiary or trustee can apply; with a life estate, only the life tenant.

Proof of service

Attach your DD-214 or other separation papers showing honorable discharge and times and places of service. DOF also accepts a letter from the New York State Division of Veterans' Services confirming discharge character under the Restoration of Honor Act.

How much it saves

Each part reduces your assessed value by a percentage, but each is capped at a fixed dollar amount of assessed value. The caps are much lower for one- to three-family homes (tax class 1) than for apartments (class 2) and class 4 property, because class 1 assessed values are much lower to begin with.

Worked example

A combat veteran with a 40% VA rating owns a two-family house (class 1) with an assessed value of $30,000 (an illustrative number).

• Basic: 15% × $30,000 = $4,500, capped at $2,880.
• Combat: 10% × $30,000 = $3,000, capped at $1,920.
• Disability: 20% (half of 40%) × $30,000 = $6,000, under the $9,600 cap, so $6,000.
• Total reduction: $10,800 of assessed value. The tax saving is that amount times your class 1 tax rate.

In practice the caps bind quickly for houses, so the disability part usually matters most. For a co-op or condo (class 2) the caps are high enough that the full percentages often apply. To turn assessed value into a tax estimate, use the NYC property tax estimator and read market value vs assessed value.

Your disability rating comes from the VA (1-800-827-1000). Send the VA's rating letter with your application. If your rating later goes up, DOF has a separate "Change in Service-Connected Disability Rating" form so your exemption can be increased.

The Eligible Funds ("old law") exemption

The Eligible Funds exemption reduces the assessed value of a home a veteran bought or improved with eligible funds: a veterans pension, bonus, insurance money, POW compensation or mustering-out pay. Unlike the Alternative exemption, it does not require you to live in the property. DOF says the maximum reduction is $7,500, and recipients below the maximum may apply for an increase with paperwork showing how the funds were used.

School taxes

Under state law, school districts can choose whether to offer the veterans exemption. In NYC, DOF says both veterans exemptions now apply to school taxes. DOF's own illustration for a typical class 1 home in fiscal year 2018 put the combined saving at $649 for the Alternative exemption and $611 for Eligible Funds; current values depend on your assessment and tax rate.

How to apply

1. 1

   Gather documents

   DD-214 or equivalent, your VA disability rating letter if you have one, and proof of ownership. Spouses, surviving spouses and Gold Star parents should check the application for the extra documents DOF asks for.
2. 2

   Find your borough, block and lot

   On your tax bill or deed. Co-op owners can ask the managing agent.
3. 3

   File by March 15

   Use DOF’s online veterans application (a co-op version exists), open September 28 to March 15, or mail the paper form. The deadline moves to the next business day if March 15 is a weekend or holiday.
4. 4

   Check the result

   If you were not approved by January 5, the benefit won’t be on your Notice of Property Value, but once approved it shows on a later bill with a credit back to July 1.

Moving within the state? If your previous New York home had the exemption, you can transfer it by applying within 30 days of buying the new home; DOF prorates it.

Other breaks to check

Veterans 65 and older may qualify for the senior exemption (SCHE) and Enhanced STAR. A veteran receiving a VA disability pension can use that letter as proof for the Disabled Homeowners' Exemption if they meet its income limit. Use the property tax breaks finder to see them all.

This guide is general information, not legal or tax advice. Confirm details with DOF via 311 or its exemptions contact form; the NYC Department of Veterans' Services can help with paperwork.