NC
North Carolina House Bill H118

North Carolina 2025-2026 Regular Session

North Carolina House Bill H118 Compare Versions

OldNewDifferences
11 GENERAL ASSEMBLY OF NORTH CAROLINA
22 SESSION 2025
3-H 2
3+H 1
44 HOUSE BILL 118
5-Committee Substitute Favorable 3/18/25
5+
66
77 Short Title: Disabled Veterans Tax Relief Bill. (Public)
8-Sponsors:
9-Referred to:
8+Sponsors: Representatives Campbell, Loftis, Schietzelt, and Chesser (Primary Sponsors).
9+For a complete list of sponsors, refer to the North Carolina General Assembly web site.
10+Referred to: Homeland Security and Military and Veterans Affairs, if favorable, Finance, if
11+favorable, Rules, Calendar, and Operations of the House
1012 February 17, 2025
11-*H118 -v-2*
13+*H118 -v-1*
1214 A BILL TO BE ENTITLED 1
13-AN ACT TO INCREASE THE DISABLED VETERAN PROPERTY TAX HOMESTE AD 2
14-EXCLUSION AMOUNT. 3
15-The General Assembly of North Carolina enacts: 4
16-SECTION 1. G.S. 105-277.1C reads as rewritten: 5
17-"§ 105-277.1C. Disabled veteran property tax homestead exclusion. 6
18-(a) Classification. – A permanent residence owned and occupied by a qualifying owner 7
19-is designated a special class of property under Article V, Section 2(2) of the North Carolina 8
20-Constitution and is taxable in accordance with this section. The first forty-five sixty-one thousand 9
21-dollars ($45,000) ($61,000) of appraised value of the residence is excluded from taxation. A 10
22-qualifying owner who receives an exclusion under this section may not receive other property 11
23-tax relief. 12
24-(b) Definitions. – The following definitions apply in this section: 13
25-(1) Disabled veteran. – A veteran of any branch of the Armed Forces of the United 14
26-States whose character of service at separation was honorable or under 15
27-honorable conditions and who satisfies one of the following requirements: 16
28-a. As of January 1 preceding the taxable year for which the exclusion 17
29-allowed by this section is claimed, the veteran had received benefits 18
30-under 38 U.S.C. § 2101. 19
31-b. The veteran has received a certification by the United States 20
32-Department of Veterans Affairs or another federal agency indicating 21
33-that, as of January 1 preceding the taxable year for which the exclusion 22
34-allowed by this section is claimed, he or she the veteran has a 23
35-service-connected, permanent, and total disability. 24
36-c. The veteran is deceased and the United States Department of Veterans 25
37-Affairs or another federal agency has certified that, as of January 1 26
38-preceding the taxable year for which the exclusion allowed by this 27
39-section is claimed, the veteran's death was the result of a 28
40-service-connected condition. 29
41-(2) Repealed by Session Laws 2009-445, s. 22(c), effective for taxes imposed for 30
42-taxable years beginning on or after July 1, 2009. 31
43-(3) Permanent residence. – Defined in G.S. 105-277.1. 32
44-(4) Property tax relief. – Defined in G.S. 105-277.1. 33
45-(4a) Qualifying owner. – An owner, as defined in G.S. 105-277.1, who is a North 34
46-Carolina resident and one of the following: 35
47-a. A disabled veteran. 36 General Assembly Of North Carolina Session 2025
48-Page 2 House Bill 118-Second Edition
49-b. The surviving spouse of a disabled veteran who has not remarried. 1
50-(5), (6) Repealed by Session Laws 2009-445, s. 22(c), effective for taxes imposed for 2
51-taxable years beginning on or after July 1, 2009. 3
52-(7) Service-connected. – Defined in 38 U.S.C. § 101. 4
53-…." 5
54-SECTION 2. This act is effective for taxes imposed for taxable years beginning on 6
55-or after July 1, 2025. 7
15+AN ACT TO MODIFY THE DISABLED VETERAN PR OPERTY TAX HOMESTEAD 2
16+EXCLUSION TO EXCLUDE FROM TAXATION THE PERCENTAGE OF APPRAISED 3
17+VALUE OF A PRIMARY RESIDENCE OWNED BY A DISABLED VETERAN THA T IS 4
18+EQUAL TO THE VETERAN 'S DISABILITY RATING. 5
19+The General Assembly of North Carolina enacts: 6
20+SECTION 1. G.S. 105-277.1C reads as rewritten: 7
21+"§ 105-277.1C. Disabled veteran property tax homestead exclusion. 8
22+(a) Classification. – A permanent residence owned and occupied by a qualifying owner 9
23+is designated a special class of property under Article V, Section 2(2) of the North Carolina 10
24+Constitution and is taxable in accordance with this section. The first forty-five thousand dollars 11
25+($45,000) of appraised value of the residence is excluded from taxation. A qualifying owner who 12
26+receives an exclusion under this section may not receive other property tax relief. The amount 13
27+excluded from taxation is as follows: 14
28+(1) Disabled veteran exclusion. – For a disabled veteran, the exclusion amount is 15
29+the product of (i) the appraised value of the residence and (ii) the percentage 16
30+of the qualifying owner's disability rating, as determined by the United States 17
31+Department of Veterans Affairs. 18
32+(2) Surviving spouse exclusion. – For the surviving spouse of a disabled veteran, 19
33+the exclusion amount is equal to the greater of (i) the amount excluded under 20
34+subdivision (1) of this subsection as of the date of the disabled veteran's death 21
35+or (ii) the first forty-five thousand dollars ($45,000) of appraised value of the 22
36+permanent residence, provided that the applicant establishes eligibility for 23
37+such exclusion by providing certification from the United States Department 24
38+of Veterans Affairs that, as of January 1 preceding the taxable year for which 25
39+the exclusion is claimed, the veteran's death was the result of a 26
40+service-connected condition. 27
41+(b) Definitions. – The following definitions apply in this section: 28
42+(1) Disabled veteran. – A veteran of any branch of the Armed Forces of the United 29
43+States whose character of service at separation was honorable or under 30
44+honorable conditions and who satisfies one of the following requirements:has 31
45+received a certification by the United States Department of Veterans Affairs 32
46+indicating that, as of January 1 preceding the taxable year for which the 33
47+exclusion allowed by this section is claimed, the veteran has been assigned a 34 General Assembly Of North Carolina Session 2025
48+Page 2 House Bill 118-First Edition
49+disability rating of fifty percent (50%) or greater for a service-connected 1
50+condition. 2
51+a. As of January 1 preceding the taxable year for which the exclusion 3
52+allowed by this section is claimed, the veteran had received benefits 4
53+under 38 U.S.C. § 2101. 5
54+b. The veteran has received a certification by the United States 6
55+Department of Veterans Affairs or another federal agency indicating 7
56+that, as of January 1 preceding the taxable year for which the exclusion 8
57+allowed by this section is claimed, he or she has a service-connected, 9
58+permanent, and total disability. 10
59+c. The veteran is deceased and the United States Department of Veterans 11
60+Affairs or another federal agency has certified that, as of January 1 12
61+preceding the taxable year for which the exclusion allowed by this 13
62+section is claimed, the veteran's death was the result of a 14
63+service-connected condition. 15
64+… 16
65+(e) Other Multiple Owners. – This subsection applies to co-owners who are not husband 17
66+and wife. Each co-owner of a permanent residence must apply separately for the exclusion 18
67+allowed under this section. 19
68+When one or more co-owners of a permanent residence qualify for the exclusion allowed 20
69+under this section and none of the co-owners qualifies for the exclusion allowed under 21
70+G.S. 105-277.1, each co-owner is entitled to the full amount of the exclusion allowed under this 22
71+section. The exclusion allowed to one co-owner may not exceed the co-owner's proportionate 23
72+share of the valuation of the property, and the amount of the exclusion allowed to all the 24
73+co-owners may not exceed the exclusion allowed under this section.property. 25
74+When one or more co-owners of a permanent residence qualify for the exclusion allowed 26
75+under this section and one or more of the co-owners qualify for the exclusion allowed under 27
76+G.S. 105-277.1, each co-owner who qualifies for the exclusion allowed under this section is 28
77+entitled to the full amount of the exclusion. The exclusion allowed to one co-owner may not 29
78+exceed the co-owner's proportionate share of the valuation of the property, and the amount of the 30
79+exclusion allowed to all the co-owners may not exceed the greater of the exclusion allowed under 31
80+this section and the exclusion allowed under G.S. 105-277.1. 32
81+(f) Application. – An application for the exclusion allowed under this section should be 33
82+filed during the regular listing period, but may be filed and must be accepted at any time up to 34
83+and through June 1 preceding the tax year for which the exclusion is claimed. An applicant for 35
84+an exclusion under this section must establish eligibility for the exclusion by providing a copy of 36
85+the veteran's disability certification or evidence of benefits received under 38 U.S.C. § 37
86+2101.certification." 38
87+SECTION 2. This act is effective for taxes imposed for taxable years beginning on 39
88+or after July 1, 2025. 40