Property Tax Exemptions By Disability Rating
Colorado Disabled Veteran Property Tax Exemptions in 2026
CRS §39-3-203 — Veteran Property Tax Exemption
Colorado Division of Veterans Affairs — Property Tax Exemption
CO Division of Property Taxation — Veteran Exemption
Colorado exempts 50% of the first $200,000 in actual value from property tax for qualifying disabled veterans — that is a $100,000 assessed value reduction. On a $450,000 home near Fort Carson at a 0.49% effective rate, the exemption saves roughly $490 per year or $41 per month. Not the most aggressive exemption in the country, but stacked on Colorado’s already-low effective rate, it meaningfully reduces your total housing cost and improves your VA loan qualification numbers.
Next step:
Check Your VA Loan Eligibility
100% P&T Exemption
- 50% of the first $200,000 in actual value exempt — $100,000 value reduction
- No income test, no cap on total home value — only the first $200K is affected
- Must be 100% permanent and total service-connected disability
- Action: File with your county assessor by July 1 of the first year you claim
Gold Star Spouse Benefit
- Surviving spouse of a qualifying veteran receives the same 50% exemption
- Must be un-remarried and occupy the home as primary residence
- Benefit continues for life as long as eligibility requirements are met
- Action: File with the county assessor with veteran’s DD-214 and VA documentation
Filing And Deadlines
- File by July 1 of the first year you claim the exemption
- One-time application — no annual reapplication required as long as circumstances stay the same
- Applications now go directly to county assessors (changed in 2024)
- Action: File once after closing and confirm it appears on your next tax bill
VA Loan Impact
- Saves $300 to $600/year depending on county rate and home value
- Colorado’s low baseline rate (~0.49%) means total housing costs stay competitive
- Combined with VA funding fee waiver, total first-year savings can exceed $10,000
- Action: Tell your lender about the exemption during preapproval for accurate escrow
Frequently Asked Questions
How much does the Colorado disabled veteran property tax exemption save?
The exemption reduces your taxable value by $100,000 (50% of the first $200,000 in actual value). At Colorado’s average effective rate of 0.49%, that saves roughly $490 per year — about $41 per month. In higher-rate counties, the savings can reach $600 to $700 per year.
Do I need to reapply every year in Colorado?
No. Colorado requires a one-time application by July 1 of the first year you claim the exemption. As long as your disability status and residency do not change, the exemption continues automatically without annual reapplication.
Does the exemption apply to homes worth more than $200,000?
Yes — but only the first $200,000 in actual value is affected. You receive a 50% reduction on that first $200,000, which is a $100,000 value reduction. Any value above $200,000 is taxed at the full rate.
The Bottom Line Up Front
Colorado exempts 50% of the first $200,000 in actual value from property tax for veterans with a 100% permanent and total service-connected disability. That translates to a $100,000 reduction in taxable value. No income test, no annual reapplication, and the surviving spouse gets the same benefit. On a $450,000 home near Fort Carson at El Paso County’s ~0.49% effective rate, the exemption saves approximately $490 per year. The benefit is moderate but reliable — and Colorado’s low baseline rates mean your total tax burden stays manageable even on the non-exempt portion.
Colorado is not a full-exemption state. Unlike Texas or Maryland, you will not reach $0 in property taxes with this exemption alone. The benefit caps at 50% of the first $200,000 in actual value, which means homes priced above $200,000 still carry a tax bill on the excess. For a veteran buying a $450,000 home, you get the exemption on the first $200,000 and pay full taxes on the remaining $250,000. That said, the exemption is simple to claim, does not require annual renewal, and stacks on top of Colorado’s already-competitive tax environment.
What To Do Based On Your Situation
- Buying a home in Colorado soon: Factor the exemption into your target PITI. The savings are modest ($25 to $50/month) but real. Tell your lender about your disability rating during preapproval so escrow is calculated accurately.
- Already own a home in Colorado: If you have not filed, submit your application to your county assessor by July 1. This is a one-time filing — no annual renewal required.
- Gold Star spouse: Un-remarried surviving spouses of qualifying veterans receive the same exemption. File with the county assessor with the veteran’s DD-214, VA documentation, and death certificate.
How Does The Colorado Exemption Work?
Colorado’s exemption is straightforward. If you are a veteran rated 100% permanent and total by the VA for a service-connected disability, 50% of the first $200,000 of your home’s actual value is exempt from property tax. The math works out to a flat $100,000 reduction in the value used to calculate your tax bill.
This is not a percentage reduction of your tax bill — it is a reduction of your assessed value. Colorado assesses residential property at 6.7% of actual value (the assessment rate set by the state). The $100,000 value reduction translates to a $6,700 reduction in assessed value, which at a typical mill levy of 70 to 90 mills produces annual savings of $469 to $603.
The exemption applies regardless of your home’s total value. A $300,000 home and a $700,000 home both get the same $100,000 value reduction. The benefit does not scale with home price — it is capped at the first $200,000 of actual value. Veterans with VA funding fee waivers stack that federal benefit on top of this state exemption for combined savings.
| Home actual value | Exempt portion (50% of first $200K) | Taxable value remaining | Annual savings at 0.49% effective rate | Monthly PITI reduction |
|---|---|---|---|---|
| $300,000 | $100,000 | $200,000 | $490 | $41 |
| $400,000 | $100,000 | $300,000 | $490 | $41 |
| $500,000 | $100,000 | $400,000 | $490 | $41 |
| $700,000 | $100,000 | $600,000 | $490 | $41 |
Deal Math: A 100% P&T veteran buying a $445,000 home near Fort Carson at 6.5% with no funding fee and the property tax exemption saves $9,568 upfront on the funding fee (2.15% of $445,000) plus $490/year on property taxes. Over 30 years, the combined savings exceed $24,000 — and the monthly payment is roughly $40 lower than a veteran without the exemption. The exemption does not eliminate your tax bill, but every dollar counts when you are calculating your debt-to-income ratio.
What Is The Exemption Worth In Real Dollars?
The dollar value is consistent regardless of home price because the exemption caps at $100,000 of actual value. What varies is the mill levy in your county — higher mill levies mean more savings from the same $100,000 reduction.
| County / area | Approx. effective rate | Annual savings from exemption | Monthly savings | Median home price (2026 est.) |
|---|---|---|---|---|
| El Paso (Fort Carson / Colorado Springs) | 0.49% | $490 | $41 | $445,000 |
| Denver metro | 0.52% | $520 | $43 | $575,000 |
| Pueblo (near Fort Carson commute) | 0.60% | $600 | $50 | $290,000 |
| Douglas County | 0.48% | $480 | $40 | $650,000 |
| Adams County (Buckley SFB) | 0.55% | $550 | $46 | $475,000 |
Home Search Impact: The Colorado exemption adds roughly $40 to $50 per month in payment capacity. At 6.5%, that translates to approximately $5,000 to $7,000 in additional purchasing power — modest compared to full-exemption states. The real advantage for veterans buying near Fort Carson or Peterson SFB is Colorado’s low baseline effective rate of ~0.49%. Even without the exemption, your property tax burden on a $450,000 home is roughly $2,205/year — about one-quarter of what you would pay on the same home in Texas or Illinois. The exemption is a useful bonus on top of an already-favorable tax environment.
How Does This Change Your VA Loan Math?
The exemption’s impact on your VA loan qualification is proportional to the savings — real but not transformative. A $40/month reduction in your PITI moves the needle on borderline files but is unlikely to be the deciding factor on most approvals.
- PITI impact: On a $450,000 home at 6.5% with $0 down near Fort Carson, removing $41/month from tax escrow drops your total PITI from approximately $3,140 to $3,099. That is a 1.3% reduction — helpful but not dramatic.
- DTI improvement: At $7,000/month gross income, the $41 reduction moves your housing DTI from 44.9% to 44.3%. On a file sitting at the margin, that half-point matters for AUS decisions.
- Buying power shift: The $41 monthly savings supports an additional $5,000 to $7,000 in purchase price at 6.5%. The bigger buying power boost comes from the VA funding fee waiver — saving $9,568 upfront on a $445,000 loan.
- Escrow calculation: Inform your lender about the exemption during preapproval. The $41/month may seem small, but accurate escrow prevents you from overpaying for the first year and then needing to request a reanalysis.
Who Is Eligible For The Colorado Exemption?
Eligibility is limited to veterans with a 100% permanent and total service-connected disability rating from the VA. There is no income test, no asset test, and no minimum length of residency beyond owning and occupying the property as your primary residence.
The qualifying veteran must have served on active duty in the armed forces of the United States and must have been honorably discharged. The property must be owner-occupied and used as the veteran’s primary residence as of the assessment date (January 1 each year). Unlike Arizona, Colorado does not extend the exemption to veterans with partial disability ratings — it is 100% P&T or nothing.
Gold Star spouses — un-remarried surviving spouses of qualifying veterans — receive the same exemption under CRS §39-3-203. The surviving spouse must continue to own and occupy the property as their primary residence.
How Do You Apply For The Colorado Exemption?
Colorado streamlined its application process in 2024. Applications now go directly to your county assessor — not the state Division of Property Taxation. This is a one-time filing, not an annual requirement.
- Obtain your VA documentation: You need a VA letter confirming 100% permanent and total service-connected disability, your DD-214, and proof of Colorado residency.
- File with your county assessor: Submit the completed exemption application directly to your county assessor’s office by July 1 of the first property tax year you are claiming the exemption.
- Confirm on your tax bill: After filing, verify that the exemption appears on your next property tax statement. If it does not, contact the assessor to confirm your application was processed.
- No annual renewal: As long as your disability status and residency do not change, the exemption continues automatically each year.
Process Watchpoint: The July 1 deadline is firm. If you close on a home after July 1, you cannot claim the exemption until the following tax year. Plan your closing date to fall before July 1 if possible so you can file immediately and receive the exemption for the current year. If you do miss the deadline, you lose one year of savings — roughly $490 at the average rate. Unlike some states, Colorado does not offer refunds or retroactive exemptions for years you were eligible but did not file, though there is a 3-year refund provision for certain delayed applications.
Where Do Veterans File In Colorado?
File with your county assessor’s office. Colorado has 64 counties. Near major military installations, these are the key contacts.
For Fort Carson and the broader Colorado Springs area, file with the El Paso County Assessor. For Peterson Space Force Base, also El Paso County. For Buckley Space Force Base near Aurora, file with Adams or Arapahoe County depending on your address. For Schriever Space Force Base, El Paso County. For the Air Force Academy, El Paso County.
Colorado Springs is the center of gravity for military homebuyers in Colorado. The El Paso County Assessor handles the largest volume of veteran exemption applications in the state. Their office is familiar with the process and can typically process applications within 2 to 4 weeks.
Do Surviving Spouses Keep The Exemption In Colorado?
Yes. Colorado extended the exemption to Gold Star spouses effective January 1, 2015. An un-remarried surviving spouse of a qualifying veteran receives the same 50% exemption on the first $200,000 of actual value. The surviving spouse must continue to own and occupy the property as a primary residence.
If the surviving spouse moves to a new property in Colorado, they can file for the exemption on the new home — the benefit is not locked to the original property. Remarriage terminates the exemption permanently.
Deal Math: A veteran family buying a $400,000 home in Pueblo County (30-minute Fort Carson commute) at a 0.60% effective rate and 6.5% mortgage rate pays $2,400/year in property taxes without the exemption and $1,800/year with it — a $600 annual savings. Combined with the VA funding fee waiver ($8,600 on a $400,000 loan), the first-year benefit totals $9,200. Pueblo’s lower home prices and slightly higher effective rate actually make the exemption more impactful per dollar spent than buying in Colorado Springs proper.
The Bottom Line
Colorado’s disabled veteran property tax exemption — 50% of the first $200,000 in actual value — saves $400 to $600 per year depending on your county’s mill levy. It is not a full exemption, and it does not scale with home price. But it requires only a one-time application, has no income test, and the surviving spouse receives the same benefit. For veterans buying near Fort Carson, Peterson SFB, or Buckley SFB, the exemption stacks on top of Colorado’s already-low effective rate of ~0.49% to keep your total housing costs competitive. File with your county assessor by July 1, confirm it on your next tax bill, and you are done.
Frequently Asked Questions
Do veterans with partial disability ratings qualify in Colorado?
No. Colorado’s veteran property tax exemption is limited to veterans with a 100% permanent and total service-connected disability. Partial ratings (10% to 90%) do not qualify for any state property tax exemption.
Is there an income limit for the Colorado exemption?
No. Colorado does not impose an income test for the disabled veteran property tax exemption. If you meet the disability and residency requirements, income is not a factor.
Should I apply before or after closing on my VA loan?
After closing — you must own and occupy the home as your primary residence before filing. Submit your application to the county assessor by July 1 of the first year you want the exemption to apply.
Will my lender adjust escrow after the exemption is approved?
Not automatically. Once the exemption appears on your tax bill, contact your mortgage servicer to request an escrow reanalysis. They will reduce your monthly payment and refund any excess balance.
Can I combine the exemption with the VA funding fee waiver?
Yes. The Colorado property tax exemption is a state benefit. The VA funding fee waiver is a federal benefit. They operate independently and can be claimed simultaneously.
Does the exemption apply to condos and townhomes?
Yes, as long as the property is your primary residence and you own it. Condos, townhomes, and single-family homes all qualify. The exemption applies to the residential real property you occupy.
What if my home is worth less than $200,000?
You still benefit. The exemption covers 50% of the first $200,000 in actual value. On a $180,000 home, you get 50% of $180,000 = $90,000 in value reduction. On a $200,000 or higher home, you get the maximum $100,000 reduction.
Does the exemption transfer if I move within Colorado?
You must file a new application with the new county assessor at your new property. The exemption is tied to the property and your occupancy, not carried forward automatically.
Can I claim the exemption retroactively for prior years?
Colorado has a limited refund provision. If your application was delayed due to a delayed VA rating decision, you may be eligible for a refund of taxes paid during the period you should have had the exemption. Contact your county assessor for specifics.
Does IU (Individual Unemployability) qualify?
If the VA classifies your disability as 100% permanent and total for compensation purposes due to IU, you should qualify. The key factor is whether your VA documentation states 100% P&T. Confirm with your county assessor.
How does Colorado compare to other military-friendly states for tax exemptions?
Colorado’s exemption is moderate. Texas and Maryland offer full exemptions with no cap. Colorado’s benefit caps at $490 to $600/year in savings. However, Colorado’s low baseline rate means your total property tax bill is already lower than most states, even before the exemption.
Does the exemption cover all taxing jurisdictions?
Yes. The exemption applies across all taxing entities — county, city, school district, and special districts. The $100,000 value reduction is applied before taxes are calculated by any jurisdiction.
