Disabled Veteran Property Tax Exemption in Connecticut (2026)

Last reviewed August 26, 2026. Every figure, form and deadline on this page is re-checked against the state’s own government sources once a quarter, and the date above is updated when we do it.

Connecticut fully exempts a disabled veteran’s primary home from local property tax if the VA has rated you permanently and totally (P&T) disabled at 100 percent. That is Connecticut General Statutes Section 12-81(83), created by Public Act 24-46 in 2024 and updated by Public Act 25-2 and Public Act 25-168 in 2025. If your rating is below 100 percent, or is 100 percent without a P&T finding, you do not get the full exemption. You get a smaller, graduated dollar exemption instead, worth $2,000 to $3,500 of assessed value, filed under a different statute with different paperwork.

Which bucket you land in changes your form, your deadline, and the dollar amount by a wide margin. Get that wrong and you either apply for the wrong benefit or miss out on the full exemption you are actually entitled to.

How much is the Connecticut exemption worth?

Connecticut runs two very different veteran property tax benefits off the same idea, a VA disability rating, and they are easy to confuse.

VA disability rating	What you get	Statute
100%, permanent and total (P&T)	Full exemption of your primary dwelling from property tax, or one motor vehicle if you have no dwelling	CGS 12-81(83)
75% to 99% (or any rating if you are 65+)	$3,500 of assessed value	CGS 12-81(20)
More than 50% up to 75%	$3,000 of assessed value	CGS 12-81(20)
More than 25% up to 50%	$2,500 of assessed value	CGS 12-81(20)
10% up to 25%	$2,000 of assessed value	CGS 12-81(20)

A veteran with a 100 percent schedular rating that the VA has not also designated permanent and total, or a veteran on individual unemployability without a P&T finding, stays in the graduated table above rather than getting the full exemption. That distinction, P&T versus a plain 100 percent rating, is the single most common point of confusion on this benefit.

The graduated exemption gets multiplied by your income

The dollar amounts in that table are the base. Connecticut then applies an income test under CGS 12-81g: if your income is at or below the state’s threshold, the exemption doubles. If your income is above it, the exemption drops to half. For 2025 income, the Office of Policy and Management set the general threshold at $46,300 for unmarried applicants and $56,500 for married applicants, and a lower threshold of $18,000 unmarried and $21,000 married for veterans with a 100 percent VA rating who are using this graduated exemption rather than the full one. Some towns have voted to raise the veteran exemption to triple the basic amount for very low-income 100 percent-rated veterans, subject to a municipal-option income cap of $21,000 unmarried and $24,000 married.

Veterans who lost a limb, or the functional equivalent, in service get an additional $5,000 to $10,000 added to the basic amount before the income multiplier is applied, under CGS 12-81(21).

What the full exemption actually covers

For a 100 percent P&T veteran, CGS 12-81(83) exempts the dwelling you own and occupy as your primary residence, including a fractional share, a condominium unit, or a mobile or manufactured home. It does not cover any part of the property used commercially or that produces rental income. If you do not own a qualifying dwelling, the exemption applies instead to one motor vehicle you own and garage in Connecticut. If you own neither, it can apply to your spouse’s dwelling or vehicle if you live together. Since the 2025 assessment year, a municipality may vote to cap the dollar value of the exemption at the town’s median assessed residential value, and may vote to extend the exempt lot to up to two acres. Check with your town assessor for whether either local option applies where you live.

Who qualifies in Connecticut?

To claim the full exemption under CGS 12-81(83) you must:

• Be a Connecticut resident who served in the Army, Navy, Marine Corps, Coast Guard, Air Force or Space Force.
• Have a service-connected disability rating of 100 percent that the VA has determined to be permanent and total. A plain 100 percent schedular rating without the P&T designation does not qualify you for this exemption, though it does qualify you for the $3,500 tier of the graduated exemption above.
• Own and occupy the dwelling as your primary residence (or own the qualifying vehicle, if you have no dwelling).

To claim the graduated exemption under CGS 12-81(20) you need a VA disability rating of at least 10 percent, or federal compensation for the loss of a limb or the equivalent, and you must have already established basic veteran status with your town clerk (an honorable discharge on file).

You cannot collect both. The statute bars an individual entitled to the full 100 percent P&T exemption from also collecting the graduated exemption on the same property, and if the VA later changes your rating away from permanent and total, you lose the full exemption and fall back to the graduated one if you still qualify.

Surviving spouses and minor children

An unremarried surviving spouse, or a deceased veteran’s minor child, generally steps into the same exemption the veteran had or would have had. Since the 2025 amendments, a municipality may also vote to extend the full P&T exemption to the surviving spouse of a veteran who met the 100 percent P&T standard but died before the law’s October 1, 2024 start date, provided the spouse remains unmarried.

Portability if you move within Connecticut

CGS 12-81cc lets a veteran who already holds one of these exemptions get a certificate from their old town’s assessor confirming the entitlement, which the new town’s assessor can use to keep the exemption running rather than making you start the proof process over. Ask your old assessor for that certificate before you move.

Can the exemption be used before closing?

In Connecticut, generally no. Eligibility for any of these exemptions is locked to who owns and occupies the property on October 1, the state’s annual Grand List assessment date. A home you buy on, say, June 1, 2026 will not carry the exemption for the assessment taken on October 1, 2026 unless you already owned and occupied it by that date, and even that assessment does not show up on a tax bill right away. Connecticut mill rates for a given fiscal year are based on the Grand List from roughly a year earlier, so a July 2027 tax bill is typically built on the October 1, 2026 assessment. Expect a real lag between the day you close and the day a new exemption actually reduces a bill.

Four states put a pre-purchase determination in the statute. Connecticut is not one of them

State rule. Four states let a qualifying veteran get something in writing from the taxing authority before they own the home:

• Virginia: file the normal exemption paperwork plus documentation of the purchase agreement and the commissioner of the revenue must process it and send an approval or denial letter, with the exemption amount, within 20 business days. Va. Code § 58.1-3219.6(B). The exemption itself takes effect only after you become the owner.
• Maryland: you may apply for a specific dwelling you intend to purchase, and the Department of Assessments and Taxation must send a preliminary approval or denial, with the amount, within 15 business days. Md. Code, Tax-Property § 7-208(d)(5). No second application is needed once you own it.
• Utah: a qualifying disabled veteran claimant may apply before owning the residence with a real estate purchase contract, filed in the county where the home sits, and the county must send a receipt with preliminary approval or denial and the calculated amount within 15 business days. Utah Code § 59-2a-502(5).
• Alabama: for closings on or after October 1, 2026, the tax assessing official issues a tentative certificate of permanent and total disability before purchase, within 20 days, and the statute says a settlement agent or loan closing officer may not consider the homestead ad valorem taxes when calculating debt-to-income once you hand over that certificate. Ala. Code § 40-9-21.3.

One correction worth having, because it gets repeated a lot: outside of Alabama these laws bind the county or the state tax office, not your lender. They force the taxing authority to answer you in writing before closing. They do not order a lender to waive or exclude the tax. Alabama is the only one of the four that reaches into the loan file itself. North Carolina has a bill that would add a prequalification process, House Bill 94, which passed the House 112 to 0 in May 2025 and has sat in Senate Rules since. It is not law, so do not plan around it.

In Connecticut it is a lender decision, so shop it

Lender overlay and market practice. There is no Connecticut statute telling the taxing authority to pre-approve you before you own the home, so whether this benefit helps you qualify comes down to lender policy. Here is what that looks like in practice, from lender guidance we collected directly in August 2026:

• Some lenders will use the reduced tax figure before closing, and some will not. One wholesale lender told us plainly it will consider a veteran real estate tax exemption and a reduced property tax number in the qualifying payment, as long as underwriting gets the local exemption rules and proof you meet them. If the documentation is short, underwriting uses the full tax amount instead. Another wholesaler checks it state by state and county by county on every single closing. If your lender says no, that is not the final answer on the benefit. It is that lender’s answer. Ask another one.
• Every lender will require proof of eligibility if the lower tax is doing work in your file. If the reduced tax is what lowers your debt ratio or raises your residual income, expect to document it: your VA rating decision or award letter showing the qualifying disability, the taxing authority’s own published exemption rules, and usually the completed exemption application. One lender’s VA guide requires proof of 100 percent disability from VA plus a copy of the completed county application for property tax exemption, and where the application has to be notarized it takes an unsigned copy up front and conditions it to be signed at closing.

Lender overlays apply everywhere. State permission is not lender permission. One large investor allows the anticipated reduced tax for qualifying only for primary residences in California, Florida, Maryland, Texas, Utah and Virginia, and only with proof the veteran applied to the taxing authority before the note date. Connecticut is not on that list.

Practically, ask your loan officer two questions before you write an offer: will you use a reduced tax figure to qualify me, and will you waive the tax escrow. Different lenders give different answers on the same file, and that is normal, not a mistake.

What we can do instead: waive the escrow

If the exemption cannot be counted yet, the fallback is to not escrow the taxes at all, so your monthly housing expense is not carrying twelve months of a tax bill that is about to shrink. VA does not require escrows, so this is a lender and investor decision, and many will allow it on a strong file. There are lenders that will waive the tax escrow on a VA loan even when the property taxes have not been waived yet, so this is a real option and not a rare favor. Some will waive it with no restrictions at all, others want the eligibility proof and the correct paperwork in the file first. Waiving escrow does not require the taxing authority to approve anything, which is why it is usually the easier ask of the two. Understand the tradeoff: with no escrow account, you pay the taxing authority directly and you are on your own for those tax bills until the exemption is actually approved, and approval can take a while. Budget for it and pay the bill on time; a delinquent tax bill on a home you just bought is an expensive way to save a few dollars of monthly payment.

One more VA rule to know, because it runs the other way. On estimating taxes, Chapter 4 says “If taxes are expected to increase, use the increased amount.” There is no matching VA instruction that lets an underwriter write down your taxes, which is why the reduction is always a lender option and never a VA entitlement. The Chapter 4 text is here if you want to read it.

Plan for the gap between closing and approval

These applications take a while to process, and the taxing authority’s calendar does not wait for your loan. A tax bill can come due between your closing date and the day your exemption is approved, and you are the owner, so that bill is yours. That can include taxes attributable to the period the prior owner held the home. One lender’s VA guide makes it explicit and requires a signed letter of explanation from the veteran borrower stating they are solely responsible for the property taxes owed for the prior owner. Keep the money set aside and do not assume the first bill will be reduced, especially if you waived escrow and Connecticut is billing you directly.

How to apply in Connecticut, step by step

Connecticut runs these as separate applications with separate deadlines. Confirm which one fits your rating before you file.

Full exemption, 100% P&T (CGS 12-81(83))

1. Get Form D-2, “Permanently and Totally Disabled Veteran, 100% Service-Connected Disability Rating,” from the Connecticut Office of Policy and Management (PDF download) or your town assessor.
2. Attach your VA determination letter showing the permanent and total, 100 percent service-connected finding.
3. File with your town’s assessor. Connecticut administers property tax by town, not county, so find your town’s assessor through the state’s own Municipal Assessor Directory (PDF download) from the Office of Policy and Management, which lists every town’s assessor and contact information.
4. Watch the deadline. The current form states the application is due annually, not later than January 1. Connecticut’s statute separately says you do not have to resubmit proof of your rating every year once it is on file and unchanged, so there is a real gap between what the statute implies and what the current form instructs. Confirm directly with your assessor which practice your town follows before you assume you are covered for a year you did not file.

Graduated exemption, 10% to 99% rating (CGS 12-81(20) and 12-81(21))

1. File your discharge paperwork with your town clerk, generally by September 30, to establish basic veteran status. This is a one-time filing under CGS 12-93, not an annual one.
2. Submit proof of your VA disability rating to your town’s assessor. The assessor’s office can tell you the exact date your grand list closes, since that controls the deadline for rating proof in your town.
3. Late filers get a window. If you get your VA rating proof after the deadline, you can generally still file within one year of getting that proof, or one year after the deadline, and receive a retroactive abatement or refund covering up to three years back.

Additional income-based exemption (CGS 12-81g)

1. File Form M-59a with your town’s assessor between February 1 and October 1 of the year you want the additional exemption for.
2. Reapply every two years. This exemption runs on a biennial cycle once granted, unlike the annual filing on Form D-2.

Can you get a refund of prior year taxes?

Up to three years back, for late filers with a documented reason. Both the 100 percent P&T exemption and the graduated disability exemption let a veteran who could not get proof of their rating in time file late and still collect. You can generally file within one year of the date you actually received your VA determination, or one year after the normal filing deadline passed, whichever applies. The maximum retroactive abatement or refund is three years’ worth of tax.

How you actually get paid depends on timing. If your town has not yet billed or collected the tax for the year in question, the assessor issues a certificate of abatement that reduces what you owe. If you already paid it, the town issues a refund order instead.

Other Connecticut programs for disabled veterans

The property tax exemptions are the headline benefit for homeowners, but Connecticut runs several other programs disabled veterans should know about. All are state programs unless labeled otherwise.

• Circuit Breaker Program (state, not veteran-specific). A property tax reduction of up to $1,250 for married applicants and $1,000 for individuals, available to homeowners 65 or older, or permanently and totally disabled, within an income limit. A disabled veteran who does not otherwise qualify for the P&T exemption above (for example, a spouse who is disabled but not the veteran) may still fit here. Administered under CGS 12-170aa through 12-170cc.
• Connecticut Department of Veterans Affairs (state). Runs the state’s Office of Advocacy and Assistance, which helps veterans and their families file federal VA claims, plus the state Veterans Home and Healthcare Center. Start at portal.ct.gov/dva.
• State income tax on military retirement pay (state). Connecticut fully exempts military retirement pay from state income tax, with no income cap, under CGS 12-701(a)(20)(B)(xvi). VA disability compensation was never taxable income to begin with, at the state or federal level. Connecticut DRS Informational Publication 2019(5) (PDF download) covers the details for armed forces personnel and veterans.
• Motor vehicle property tax exemption. The same veteran statutes that create the basic and graduated home exemptions also let a veteran apply an unused exemption balance to a motor vehicle, and the full 100 percent P&T exemption applies directly to one vehicle if you have no qualifying dwelling. File with your town assessor the same way.

Connecticut disabled veteran property tax FAQs

Does Connecticut give disabled veterans a full property tax exemption?

Yes, but only if the VA has rated you permanently and totally (P&T) disabled at 100 percent. That exemption, under Connecticut General Statutes Section 12-81(83), fully exempts your primary dwelling from local property tax. If you do not own a home, it applies to one vehicle instead. Veterans rated below 100 percent, or rated 100 percent without a P&T finding, get a graduated dollar exemption instead, not a full one.

What if I am rated less than 100 percent?

You qualify for the graduated exemption under CGS Section 12-81(20) once your rating is at least 10 percent. It ranges from $2,000 to $3,500 of assessed value depending on your rating, plus an income-based multiplier that can double it or cut it in half, plus an extra $5,000 to $10,000 if you lost a limb or the equivalent in service.

What form do I file for the full 100% P&T exemption?

Form D-2, Permanently and Totally Disabled Veteran Tax Exemption, filed with your town’s assessor along with your VA determination letter showing the 100 percent P&T rating. The current form states it is due annually, not later than January 1.

Is Connecticut’s veteran exemption income tested?

The full 100 percent P&T exemption under CGS 12-81(83) has no income test. The graduated exemption under 12-81(20) and the separate Additional Veterans Tax Relief Program under 12-81g do use income limits, and those limits are set annually by the Office of Policy and Management.

Can a surviving spouse keep the Connecticut exemption?

Yes, generally while the spouse remains unmarried. The full 100 percent P&T exemption and the graduated disability exemption both pass to an eligible surviving spouse, and towns may extend the P&T exemption to spouses of veterans who died before the law’s October 1, 2024 start date.

Can I use this exemption on a house I am buying right now?

Not for the current Grand List. Connecticut sets eligibility by ownership and occupancy on the October 1 assessment date, and that assessment does not reach a tax bill until the following fiscal year. Buy partway through the year and you generally cannot get the exemption applied before you own the home on the next October 1.

Does this exemption count toward my VA loan payment before closing?

The state deciding you qualify is not the same as a lender agreeing to count the lower tax bill before it exists. Most lenders will not reduce your escrow estimate for a Connecticut exemption that has not been approved yet, so plan on the full, non-exempt tax bill at closing and ask about an escrow waiver instead.

Where to go next

• Disabled Veteran Property Tax Exemption Guide, every state’s exemption, form and deadline in one directory
• The complete guide to VA home loans
• Property tax discounts for veterans on VA disability, the national overview
• Funding Fee Waivers and Refunds Guide, the fee is waived outright at a 10 percent rating or higher, and can be refunded if you already paid it
• How to get a VA home loan with bad credit
• VA residual income calculator
• Connecticut OPM, Additional Veterans Tax Relief Program
• Connecticut General Statutes, Chapter 203, Property Tax Assessment, including Sections 12-81, 12-81g, 12-93 and 12-95
• Directory of all Connecticut town assessors (PDF download)