New Arizona Law Expands Property Tax Exemptions for Disabled Veterans

Effective beginning with Tax Year 2026, Arizona House Bill 2792 significantly expands property tax relief for disabled veterans and certain surviving spouses.

If you are a veteran or the surviving spouse of a veteran, these changes could substantially reduce—or even eliminate—your property tax obligation on your primary residence.

What’s Changing?

Full Property Tax Exemption for Certain Disabled Veterans

A veteran’s primary residence is now fully exempt from Arizona property taxes if the veteran:

• Has a 100% service-connected disability, or
• Has been awarded Total Disability based on Individual Unemployability (TDIU) by the U.S. Department of Veterans Affairs.

Under the new law, veterans receiving TDIU are treated the same as veterans with a 100% disability rating for purposes of the exemption.

Please note: Veterans who qualify under multiple categories may only claim one exemption.

Surviving Spouses May Continue the Exemption

If a veteran qualified for the full exemption, the surviving spouse may continue receiving the full property tax exemption as long as he or she does not remarry.

Partial Exemptions Still Available

Veterans who have:

• A service-connected disability rated at less than 100%, or
• A qualifying non-service-connected disability,

may still qualify for a partial property tax exemption, with exemption amounts adjusted annually for inflation.

Surviving spouses of veterans who qualified for a partial exemption may also continue receiving that same percentage-based exemption.

Income Limits No Longer Apply to Veterans

One of the most significant changes under House Bill 2792 is that income limits no longer apply to veterans claiming these exemptions.

Income limits now apply only to:

• Certain widows and widowers not qualifying under the veteran provisions, and
• Individuals with total and permanent disabilities who are not veterans.

Additionally, VA disability compensation—including TDIU benefits—is specifically excluded when calculating income.

Moving to a New Home?

Veterans who receive the exemption and purchase or move into a new primary residence must file an Exemption Transfer Form with their County Assessor within 60 days to continue receiving the exemption on the new property.

What Should You Do Next?

If you believe you qualify, contact your County Assessor’s Office to learn about the application process and any documentation required for your county.

Disclaimer: This article is provided for informational purposes only and does not constitute legal or tax advice. Eligibility requirements and filing procedures may vary by county. Veterans should contact their local County Assessor’s Office regarding the application process for the applicable tax year.