Senate Bill 107, signed into law by Gov. Bruce Rauner, will provide a big financial boost to thousands of disabled Illinois veterans who own their homes.
The law dramatically expands upon the disabled veteran’s homestead exemption that had already provided significant property tax relief.
But to get the most out of the new law, you will need to know the mechanics of how it works. Below are a few commonly asked questions, answered with the help of Jennifer Gomric-Minton, the St. Clair County assessor:
How do I qualify?
SB 107 expands on a previous law that provided graduated levels of property tax relief to veterans depending on their level of disability and the value of their houses.
If you already qualified for the earlier law, then your name will be on a list kept by their county assessor of homeowners who receive tax relief because of their level of disability. The list will be automatically updated to take into account the expanded levels of tax relief. As with the old law, eligible veterans must will receive a form each year that they must send back to their county assessor that certifies their level of disability.
If you haven’t qualified before, then you will need to provide to the assessor the following documents: Your Department of Defense discharge form, or DoD 214, which proves you are a military veteran; your award letter from the U.S. Department of Veteran Affairs certifying your level of service-connected disability; and a copy of the deed to your house.
What levels of tax relief does SB 107 provide?
The new law provides three levels of property relief for disabled veterans who own homes with an estimated market value of up to $750,000. This compares to the old law, which provided just two levels of property tax relief.
Under SB 107, the first level deducts $2,500 from the assessed value of homes for owners with a service-connected disability from 30 to 49 percent. The second level deducts $5,000 from the assessed value of homes for veterans with a disability rating of between 50 to 69 percent. And the third level waives property taxes entirely for veterans with a disability rating of at least 70 percent.
How will SB 107 apply to a house owned by disabled veteran with a market value of $150,000?
If the disabled veteran’s home has a market value of $150,000, then therefore it an assessed value of $50,000. Now suppose the property owner is a veteran with a disability rating of between 30 and 49 percent. That means the veteran would subtract from the $50,000 assessed value the $6,000 automatic owner-occupancy exemption, plus another $2,500. This knocks the assessed value of his or her house to $41,500. The actual tax bill the homeowner ends up paying in 2016 will depend on the tax rates of the taxing bodies, such as school districts and towns, where he or she lives.
If the disabled veteran has a service disability rating of between 50 and 69 percent, then $5,000 will be knocked from the assessed $50,000 value of the veteran’s home, in addition to the $6,000 automatic owner-occupancy exemption, resulting in an assessed value of $39,000. And if the homeowner has a disability rating of 70 percent or more, then that veteran’s home is exempt from all property taxes.
How many veterans are affected by SB 107?
Census figures show there are nearly 28,000 veterans with service-related disabilities in Illinois. In addition, nearly 14,000 property tax exemptions were awarded to veterans in 2013, according to the Illinois Department of Revenue.
In St. Clair County, more than 1,100 disabled veterans have at least a 70-percent disability rating. Another 600 have a VA disability rating of from 50 to 69 percent, according to Gomric-Minton.
Contact reporter Mike Fitzgerald at firstname.lastname@example.org or 618-239-2533.