Maryland Proposes Clearer Rules on What Its Disabled Veterans' Property Tax Exemption Covers, Including After a Divorce

EASTON, MARYLAND — Talbot County veterans who qualify for Maryland's property tax exemption for 100% disabled veterans, and surviving spouses who hold it, would get written rules on which part of their property the exemption covers and how a divorced couple can each claim a home under a proposal published in the Nov. 13 Maryland Register.

The state Department of Assessments and Taxation says the changes clarify the definition of primary residence for a married couple in which both spouses have a 100% disability rating from the VA, and the process for granting the exemption on a second property after a divorce. They also line up the exemption's definition of curtilage, the lot and the structures needed to use a home as a residence, with the one used for the Homestead Tax Credit.

Under the proposal, the exemption would apply only to the value of the curtilage. That would include only the principal residence and the structures necessary to support it. It would not include land assessed at a preferential rate, land used to support other structures, or portions of a dwelling that are rented or occupied by more than two families.

On divorce, the proposal says a married couple is entitled to only one primary residence for tax purposes. Because Maryland does not recognize legal separation apart from divorce, separation alone would not let each spouse claim a primary residence outside the marital home. Formerly married people could each register a primary residence by submitting the court order granting the divorce.

The department says the proposal has no economic impact.

The exemption itself comes from state law. It covers the dwelling of a veteran whose disability the VA has rated 100% service-connected, permanent and total, and the disability cannot be due to the veteran's misconduct. The home must be the veteran's principal residence and owned by the veteran, and applicants must provide a copy of the veteran's discharge certificate, according to the department. The department also cites an Attorney General's opinion that the exemption may be granted for a rating below 100% if the VA finds the veteran permanently unemployable. State law also provides an exemption for the home of a qualifying surviving spouse who has not remarried. Applications go to the local assessment office where the property sits. In Talbot County, that is the office of Supervisor of Assessments Lesley Jackson at 29466 Pintail Drive, Suite 12, in Easton, 410-819-5920.

Comments on the proposal go to Adam Lewis, state supervisor of the department's Real Property Division, at 700 E. Pratt St., Suite 2100, or 410-767-1199, through Dec. 14. No public hearing has been scheduled.