Arizona Disabled Veteran Property Tax Exemptions in 2026
Does Arizona Exempt Disabled Veterans From Property Tax?
Arizona fully exempts the primary residence of a Veteran with a 100% service-connected VA disability rating or total disability based on individual unemployability (TDIU) from all property tax under ARS §42-11111(C). There is no income test for this category. Veterans rated below 100% receive a partial assessed-value reduction equal to a statutory base amount multiplied by their disability percentage. File with your county assessor by February 28. [1] [2] [3]
Property tax exemptions are administered by Arizona county assessors, not by VA or VA Loan Network. This information is educational, not a tax assessment or mortgage approval.
Arizona Veteran Exemptions at a Glance
Choose an area to jump to the law, calculations, application steps and important exceptions.
What Does Arizona Law Actually Say?
Two separate subsections create two very different benefits.
What Is the Exemption at Each Rating Level?
Full exemption at 100% versus a small assessed-value reduction below.
Who Qualifies for the Full Exemption?
100% SC or TDIU, primary residence, file with assessor.
How Much Property Tax Could You Save?
Actual savings depend on county rates that range from 0.40% to 0.65%.
How Do You Apply and Meet the Deadline?
File with the county assessor, not the state or VA.
How Does the Exemption Affect a VA Mortgage?
Escrow, DTI and buying power shift when taxes drop to zero.
Do Surviving Spouses Keep the Exemption?
Unremarried surviving spouses can retain the benefit.
Real-World Arizona Veteran Scenarios
Buyer near Luke AFB, owner at Davis-Monthan, TDIU and survivor.
What Mistakes Can Cost You the Exemption?
Missed deadlines, wrong office, bad income assumptions.
Frequently Asked Questions
Straight answers to common Arizona Veteran searches.
Where Do Arizona Veterans File?
County-by-county filing with Military installation reference.
Sources and Verification Method
Statute, county assessor guidance and federal rules.
At 100%, no income test and no property tax. Arizona’s full exemption for 100% service-connected Veterans has no income threshold, no cap on home value and the program is permanent once approved. Partial ratings produce minimal savings. Arizona’s low baseline rates make even unexempted housing affordable.
What Does Arizona Law Actually Say?
ARS §42-11111 creates multiple exemption paths. The two that matter for Veterans are subsection C (100% service-connected or TDIU) and subsection D (partial ratings below 100%). They have different mechanics and different outcomes. [1]
100% Service-Connected or TDIU
The primary residence is “fully exempt from taxation.” No cap on home value. No income test. Applies to Veterans rated 100% service-connected by VA or determined to have total disability based on individual unemployability.
Below 100% Service-Connected
A statutory base amount (currently $4,188, adjusted annually by the GDP price deflator) is multiplied by the Veteran’s disability percentage. That figure reduces the property’s assessed value, not the tax bill directly. No income test applies to this category either.
A separate category under subsection E covers persons with a total and permanent disability certified by a medical authority (not necessarily VA-rated). That path carries the income test. The three paths serve different populations and should not be conflated. [1]
What Is the Exemption at Each Rating Level?
Arizona’s exemption structure has a sharp cliff between partial and full disability. Partial ratings produce minimal savings because the reduction applies to assessed value (10% of full cash value for residential property), not the market price or the tax bill. [1] [4]
| VA Disability Rating | Exemption Mechanism | Assessed Value Reduction | Illustrative Annual Tax Savings |
|---|---|---|---|
| 10% | Base × 10% | $419 | Minimal (under $5) |
| 30% | Base × 30% | $1,256 | Under $10 |
| 50% | Base × 50% | $2,094 | Under $15 |
| 70% | Base × 70% | $2,932 | Under $20 |
| 90% | Base × 90% | $3,769 | Under $25 |
| 100% SC or TDIU | Full exemption | Entire assessed value | $1,400 to $3,150+ |
| Surviving spouse (100%) | Full exemption | Entire assessed value | $1,400 to $3,150+ |
The statutory base amount is $4,188, adjusted annually by the GDP price deflator. Maricopa County’s 2026 application materials reference $4,873 as the adjusted figure. [1] [3]
Because Arizona assesses residential property at 10% of full cash value, a $2,094 assessed-value reduction on a $350,000 home (assessed at $35,000) at a 0.43% statewide average rate produces single-digit annual savings. The partial exemption is effectively a 100%-or-nothing benefit. [1] [4]
Who Qualifies for the Full Exemption?
The full exemption under subsection C requires a 100% service-connected disability rating or a TDIU determination from VA, ownership of the property, and occupancy as your primary residence. No income test, no cap on home value. [1] [3]
What You Need to Establish
- 100% service-connected VA disability rating or TDIU determination
- VA Summary of Benefits Letter confirming rating and service-connected status
- Arizona residency and ownership of the property
- Occupancy as your primary residence
- File with the county assessor where the property is located
Situations Requiring a Closer Look
- TDIU: the statute expressly includes “total disability based on individual unemployability,” so TDIU does qualify under subsection C
- Schedular 100%: qualifies as long as VA rates the disability as service-connected
- Combined 100%: verify that VA documentation shows a single 100% rating or TDIU, not just a combined total
- Proposed or memorandum rating: confirm with the assessor whether pending documentation is accepted
For a broader view of VA disability benefits and how they interact with home loans, see VA Disability Rates for 2026. The Disabled Veteran Property Tax Calculator can help compare Arizona’s exemption with other states. The VA disability rating determines the state exemption category, but the exemption itself is administered by the county assessor, not VA. [1] [5]
How Much Property Tax Could You Save?
Savings depend on the county’s effective tax rate and your home’s value. Arizona’s statewide average effective rate of 0.43% is among the lowest in the nation. County rates range from approximately 0.40% in Maricopa to 0.65% in Pima. [4]
| Home Value | County | Effective Rate | Annual Tax Without Exemption | Annual Savings (100% SC) | Monthly Savings |
|---|---|---|---|---|---|
| $300,000 | Maricopa | 0.40% | $1,200 | $1,200 | $100 |
| $350,000 | Pima | 0.65% | $2,275 | $2,275 | $190 |
| $400,000 | Maricopa | 0.40% | $1,600 | $1,600 | $133 |
| $350,000 | Cochise | 0.53% | $1,855 | $1,855 | $155 |
| $350,000 | Yuma | 0.54% | $1,890 | $1,890 | $158 |
| $500,000 | Maricopa | 0.40% | $2,000 | $2,000 | $167 |
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Arizona’s low rates mean the absolute dollar savings are more modest than in high-tax states like Texas or Illinois. But the exemption still eliminates a recurring monthly cost entirely, and in combination with the VA funding fee exemption and zero-down VA financing, the total first-year benefit is substantial. [4] [6]
What About the Partial Exemption?
50% Rating
At a 0.43% rate on a $350,000 home, a $2,094 assessed-value reduction saves approximately $13 per year.
70% Rating
A $2,932 assessed-value reduction saves roughly $18 per year at the statewide average.
100% Rating
Full exemption eliminates the entire tax bill. The cliff between 90% and 100% is where the real benefit sits.
For Veterans rated below 100%, the partial exemption filing may not justify the effort. The meaningful benefit is concentrated entirely at the 100% level. If you are pursuing an increase in your VA rating, the VA Disability Calculator can help estimate compensation changes. [1]
How Do You Apply and Meet the Deadline?
File with the county assessor’s office where the property is located. The filing window runs from the first Monday in January through February 28. An Exemption Deadline Waiver may allow filing by September 1 in some counties. [3]
Download your VA Summary of Benefits Letter from VA.gov or request it from your local VA office. It must confirm your disability rating and service-connected status.
The exemption applies only to your primary residence. Have your deed or title documentation available.
Submit the application to your county assessor’s office between the first Monday in January and February 28.
VA letter, proof of Arizona residency, ownership documentation and any county-specific forms the assessor requires.
Request a letter from the assessor confirming the exemption. Keep it for your mortgage servicer.
Once the exemption is reflected on your tax bill, provide documentation to your lender and request an escrow reanalysis. Your monthly payment should decrease.
Is This a One-Time or Annual Filing?
According to Maricopa County, the Personal Exemption is a “permanent program.” You do not need to refile every year. However, the county assessor has authority to require verification at any time, and you must report disqualifying events such as a change in disability status, sale of the home, or change in primary residence. [3]
What If You Miss the February 28 Deadline?
Some counties accept an Exemption Deadline Waiver that extends the filing window to September 1. Contact your county assessor before February 28 if you anticipate a late filing. Without a waiver, you may need to wait until the next year’s filing window. [3]
For Veterans buying a home, the VA loan process and the exemption application are separate tracks. You cannot file for the exemption until you own and occupy the property. If your closing happens after February 28, you file in the next January window unless a deadline waiver is available. The VA loan preapproval can begin before you identify a property. [1] [3]
How Does the Exemption Affect a VA Mortgage?
Eliminating property tax removes the tax escrow component from your monthly payment, improves your debt-to-income ratio and can increase the home price you qualify for. The effect is proportional to Arizona’s lower tax rates. [6] [7]
Before the Exemption Is Approved
Illustrative: $400,000 home, 6.5% rate, $0 down, Maricopa County (0.40%).
P&I $2,528 + insurance $127 + tax escrow $133.
After Full Exemption Approved
Same loan terms, property tax escrow drops to $0.
P&I $2,528 + insurance $127 + tax $0. The $133 monthly reduction also improves your debt-to-income ratio.
The federal VA funding fee exemption is a separate benefit. A 100% service-connected Veteran purchasing a $400,000 home with less than 5% down would save $8,600 on the one-time funding fee (2.15% of the loan amount). Combined with the property tax exemption, the total first-year benefit at a Maricopa County home is approximately $10,200: $8,600 in funding fee savings plus $1,600 in annual property tax savings. See 2026 VA Funding Fee Calculator for the current rate schedule. [6]
For an accurate view of what you can afford, the housing-cost calculator at How Much VA Loan Can I Afford? can model the PITI impact. Use the actual approved exemption amount, not an assumed future benefit, when budgeting. [7]
Do Surviving Spouses Keep the Exemption?
ARS §42-11111 provides explicit surviving-spouse rules. The benefit depends on which subsection the Veteran qualified under, and the surviving spouse must meet their own occupancy requirements. [1]
| Veteran’s Status | Surviving Spouse Benefit | Conditions |
|---|---|---|
| 100% SC (subsection C) | Full exemption continues under subsection F | Unremarried, same primary residence, file with assessor |
| Partial SC (subsection D) | Same partial reduction continues under subsection G | Unremarried, same primary residence, base amount times Veteran’s rating |
| Remarried surviving spouse | Eligibility ends | Remarriage terminates the exemption permanently |
The surviving spouse must continue to own and occupy the property as a primary residence. If the spouse moves to a new property, they must file a new application at the new county assessor within sixty days of occupying the new home. The exemption can transfer to a new property if the surviving spouse qualifies. For more on surviving spouse benefits, see Surviving Spouse Property Tax Exemptions. [1]
Real-World Arizona Veteran Scenarios
The following cases illustrate how the exemption, VA loan benefits and county rates interact. Each scenario is illustrative, not a guarantee. [1] [4] [6]
100% P&T Veteran Near Luke AFB
A 100% SC Veteran purchases a $450,000 home in Glendale (Maricopa County, 0.40%). Annual tax would be $1,800. The full exemption saves $1,800 per year, or $150 per month. The funding fee exemption saves $9,675 upfront (2.15% of $450,000). Total first-year benefit: approximately $11,475.
100% SC at Davis-Monthan AFB
A Veteran already owns a $325,000 home in Tucson (Pima County, 0.65%). Annual tax is $2,113. After filing with the Pima County Assessor, the entire bill is eliminated. The Veteran requests an escrow reanalysis and the monthly mortgage payment decreases by $176.
TDIU Rating, Fort Huachuca
A Veteran rated TDIU by VA purchases a $265,000 home near Sierra Vista (Cochise County, 0.53%). Because Arizona’s statute expressly includes TDIU under subsection C, the Veteran qualifies for the full exemption. Annual savings: $1,405. No income test applies.
Unremarried Widow in Maricopa County
The surviving spouse of a 100% SC Veteran remains in the family home valued at $400,000. Under subsection F, the full exemption continues. The spouse files with the Maricopa County Assessor and provides the Veteran’s VA documentation, death certificate and proof of unremarried status.
For service members comparing housing allowances with mortgage payments, use documented BAH rates from the BAH Pay Calculator and the actual verified tax bill, not an assumed exemption. [1]
What Mistakes Can Cost You the Exemption?
The biggest mistakes are assuming the exemption is automatic, confusing the income test (subsection E) with the service-connected path (subsection C), and missing the county assessor’s deadline. [1] [3]
Before You File
- Confirm your VA letter shows the exact rating and service-connected status
- Identify the correct county assessor for the property location
- File between the first Monday in January and February 28
- Ask about the Exemption Deadline Waiver if you may miss February 28
- Keep a copy of everything you submit
- Request written confirmation from the assessor
Before You Budget for a Home
- Use county-specific tax rates, not the statewide average
- Do not assume the exemption is approved until the assessor confirms it
- Separate the annual property tax savings from the one-time funding fee savings
- Tell your lender about your disability rating during income qualification so they can model the exemption
- If closing after February 28, budget for full taxes until the next filing window
- Report any change in disability status, ownership or residency to the assessor
Where Do Arizona Veterans File?
You file with the county assessor where the property is located. Arizona has 15 counties, and each processes exemption applications independently. The table below shows the major Military installations and their home counties. [3] [4]
| Military Installation | County | Effective Rate | Annual Savings on $350K Home (100% SC) | Median Home Value |
|---|---|---|---|---|
| Luke AFB (Glendale) | Maricopa | 0.40% | $1,400 | $483,000 |
| Davis-Monthan AFB (Tucson) | Pima | 0.65% | $2,275 | $350,000 |
| Fort Huachuca (Sierra Vista) | Cochise | 0.53% | $1,855 | $232,000 |
| Yuma Proving Ground | Yuma | 0.54% | $1,890 | $255,000 |
Effective tax rates and median values are approximations from public sources and will vary by parcel. The assessor’s office can provide the actual tax liability for a specific property. For VA loan benefits that apply regardless of location, see the national guide. [4]
Frequently Asked Questions
Quick answers to the questions Arizona Veterans ask when evaluating property tax relief in 2026.
Do 100% disabled Veterans pay property taxes in Arizona?
No, if the disability is service-connected and the Veteran files with the county assessor. ARS §42-11111(C) fully exempts the primary residence of a Veteran rated 100% service-connected or TDIU. There is no income test for this category. [1]
Is there an income test for Arizona’s Veteran property tax exemption?
Not for service-connected Veterans. The income limits in ARS §42-11111(J) apply only to subsection E claimants (persons with non-service-connected total and permanent disability). Veterans claiming under subsections C or D have no income threshold. [1]
Does TDIU (Individual Unemployability) qualify for the full exemption?
Yes. The statute expressly includes “total disability based on individual unemployability” alongside 100% service-connected disability under subsection C. A TDIU Veteran receives the same full exemption as a schedular 100% Veteran. [1]
When is the Arizona Veteran property tax exemption filing deadline?
The filing window runs from the first Monday in January through February 28. Some counties offer an Exemption Deadline Waiver that extends the window to September 1. Contact your county assessor to confirm. [3]
Do I have to reapply every year in Arizona?
According to Maricopa County, the Personal Exemption is a permanent program. You do not need to refile annually. However, the assessor may verify qualification periodically, and you must report disqualifying events. [3]
Does the property tax exemption affect my VA loan qualification?
Can I combine the property tax exemption with the VA funding fee waiver?
Yes. The property tax exemption is a state benefit from the county assessor. The VA funding fee exemption is a federal benefit. They are independent programs with different eligibility rules. [1] [6]
Will my lender adjust my escrow after the exemption is approved?
Not automatically. Once the exemption appears on your property tax bill, provide documentation to your servicer and request an escrow reanalysis. Your monthly payment should decrease and any surplus may be refunded. [7]
Can I get the exemption on a rental property or second home?
No. The exemption applies only to the Veteran’s primary residence. Rental properties, second homes and investment properties do not qualify. [1]
What if my disability rating changes?
If your rating increases to 100%, you can apply for the full exemption. If it decreases below 100%, you revert to the partial assessed-value reduction at your new percentage. Report any rating change to the county assessor. [1]
Can a surviving spouse transfer the exemption to a new home?
Yes. If an unremarried surviving spouse moves, they must file a new application with the county assessor where the new property is located within sixty days of occupying the new home. [1]
Does the full exemption cover all tax levies including school district?
The statute says the property is “fully exempt from taxation.” That language covers all ad valorem property taxes on the primary residence, including county, city, school district and special district levies. Confirm with your assessor that all levies are reflected. [1]
Sources and Verification Method
This article prioritizes current Arizona statute, county assessor guidance, VA.gov and the CFPB. Dollar examples are illustrative and based on published county effective rates. [1] [3] [4]
- Arizona Revised Statutes §42-11111. Exemptions for disabled Veterans (subsections C, D, F, G), income test for non-SC claims (subsections E, J), excluded income (subsection I), GDP deflator adjustment (subsection H).
- Arizona Department of Revenue: Property Tax FAQs. Overview of Arizona property tax administration and county assessor responsibilities.
- Maricopa County Assessor: Valuation Relief. Filing window (first Monday in January through February 28), permanent program status, deadline waiver, income limits for non-SC claims, 2026 adjusted base amount.
- SmartAsset: Arizona Property Tax Calculator. County effective rates: Maricopa 0.40%, Pima 0.65%, Cochise 0.53%, Yuma 0.54%, Pinal 0.41%. Statewide average 0.43%.
- U.S. Department of Veterans Affairs: Disability Compensation. VA disability rating structure, service-connected determinations and TDIU designations.
- U.S. Department of Veterans Affairs: Funding Fee and Closing Costs. First-use purchase fee 2.15% with less than 5% down; exemption for service-connected disability compensation recipients.
- Consumer Financial Protection Bureau: Mortgage Servicing FAQs. Escrow account analysis timing, shortage and surplus treatment.
- Arizona Revised Statutes §42-15003. Class three residential property assessed at 10% of full cash value.
What We Verified
Statutory subsection structure (C vs. D vs. E), no income test for service-connected claims, TDIU inclusion, filing window and permanent program status from county assessor, effective tax rates by county, VA funding fee rates, and surviving spouse transfer rules.
What Must Be Checked Locally
The actual tax liability for a specific parcel, the assessor’s confirmation of exemption approval, the precise adjusted exemption base for the current year, and any county-specific documentation requirements beyond the standard application.
Calculate the Tax Impact Before You Choose a Mortgage.
Confirm your exemption with the county assessor, then ask a VA loan specialist to review the complete housing payment, funding fee status and qualification picture.