Maryland Disabled Veteran Property Tax Exemptions in 2026
Does Maryland Exempt Disabled Veterans From Property Tax?
Maryland grants a full property tax exemption to Veterans whose VA rating confirms a 100% service-connected permanent and total disability. The exemption eliminates state, county, and municipal property taxes on the Veteran’s dwelling with no cap on home value, no income test, and no expiration. Un-remarried surviving spouses retain the benefit. Apply through the Maryland State Department of Assessments and Taxation (SDAT) using Form 0726-A and your VA rating documentation. [1] [2] [3]
Property tax exemptions are administered by Maryland SDAT, not by VA or VA Loan Network. This information is educational, not a tax assessment or mortgage approval.
Maryland Veteran Exemptions at a Glance
Choose an area to jump to the law, dollar math, application steps and important edge cases.
How Does the Maryland Exemption Work?
Full exemption for 100% P&T Veterans on the dwelling, lot, and necessary structures.
Who Qualifies for the Maryland Exemption?
VA documentation of permanent and total service-connected disability is required.
What Is the Exemption Worth in Real Dollars?
Savings by home value near Fort Meade, JB Andrews, Aberdeen, and Pax River.
How Does the Exemption Affect a VA Mortgage?
Tax escrow, DTI, buying power, and funding-fee stacking.
How Do You Apply for the Exemption?
One-time filing with SDAT, pre-purchase option, and retroactive refunds.
Do Surviving Spouses Keep the Exemption?
Un-remarried spouses retain the full benefit or transfer a dollar amount.
Where Do Veterans File in Maryland?
County SDAT offices near every major Military installation.
Real-World Maryland Veteran Scenarios
First-time buyer, existing homeowner, surviving spouse, and post-rating filer.
What About Partial Ratings, IU, and Special Properties?
Below 100%, condos, vacant land, and the Homestead Credit interaction.
What Mistakes Can Cost You the Exemption?
Filing errors, escrow timing, and retroactive-refund deadlines.
Frequently Asked Questions
Straight answers to the questions Maryland Veterans ask.
Sources and Verification Method
Statute, SDAT guidance, VA.gov, and CFPB escrow rules.
Maryland’s 100% P&T exemption is among the strongest in the country. No value cap, no income test, no annual refiling. On a $500,000 home at the statewide average rate, a qualifying Veteran saves roughly $4,750 per year. File once with SDAT and the dwelling stays exempt for as long as you own and occupy it.
How Does the Maryland Exemption Work?
Tax-Property §7-208 exempts the dwelling of a Veteran with a 100% service-connected permanent and total disability from all property taxation. The exemption is not partial, not capped, and not income-tested. [1] [2]
What the Exemption Covers
- Dwelling house: the primary residence occupied by the Veteran or surviving spouse
- Lot and curtilage: the land immediately surrounding the home
- Necessary structures: garage, utility shed, detached carport, and similar residential outbuildings
- All tax layers: state, county, and municipal property taxes are eliminated
What the Exemption Does Not Cover
- Investment property: rental homes, second homes, and commercial buildings are excluded
- Vacant land: unimproved lots without a dwelling are not eligible
- Non-residential structures: a standalone workshop or commercial building on a different parcel
- Partial disability: Veterans rated below 100% P&T receive no state-level exemption
The disability must be service-connected and cannot be due to the Veteran’s own misconduct. The VA must have determined the disability to be 100% permanent and total. There is no age requirement, no minimum residency period beyond occupying the home as a primary residence, and no annual reapplication. [2]
Maryland also has a separate provision for active-duty service members with service-connected physical disabilities that are reasonably certain to continue for life. That path requires physician certification or VA documentation but follows the same SDAT filing process. [1]
Who Qualifies for the Maryland Exemption?
Eligibility is straightforward but strict. The VA rating decision must expressly confirm 100% service-connected permanent and total disability. A standalone 100% schedular rating without the P&T designation is not enough. [1] [2] [4]
Required Evidence
- VA certification or final VA disability rating decision letter confirming 100% service-connected permanent and total status with the effective date
- Discharge certificate (DD-214) from active Military service
- Maryland Driver’s License or prior-year Maryland tax return as proof of residency
- Completed SDAT Form 0726-A (Application for Exemption for Disabled Veteran)
Situations Requiring a Closer Look
- TDIU: if your VA letter states 100% permanent and total for compensation purposes due to Individual Unemployability, confirm with SDAT that IU documentation meets the statutory requirement
- 100% schedular without P&T: verify whether the VA separately confirmed permanence; a combined 100% rating alone may not qualify
- Misconduct exclusion: the disability cannot have resulted from the Veteran’s own misconduct
- VA Summary of Benefits letter: SDAT does not accept these; use the full rating decision
There is no income test, no asset test, and no minimum service length beyond what qualifies you for VA benefits. Veterans with other VA disability grants should check their specific documentation for the P&T designation. The key gate is the VA documentation. If your rating decision confirms 100% P&T and service connection, and the disability did not result from misconduct, you qualify for the full exemption on your primary-residence dwelling in Maryland. [1]
What Is the Exemption Worth in Real Dollars?
Maryland’s statewide average effective property tax rate is approximately 0.95%, but county rates vary from roughly 0.80% in Harford County to over 1.40% in Baltimore City. The exemption value scales directly with your home’s assessed value and the local rate. [2] [8]
| Home Value | County (Installation) | Approx. Effective Rate | Annual Tax Savings | Monthly Savings |
|---|---|---|---|---|
| $400,000 | Anne Arundel (Fort Meade) | 0.83% | $3,320 | $277 |
| $500,000 | Anne Arundel (Fort Meade) | 0.83% | $4,150 | $346 |
| $550,000 | Prince George’s (JB Andrews) | 1.12% | $6,160 | $513 |
| $475,000 | Harford (Aberdeen PG) | 0.80% | $3,800 | $317 |
| $450,000 | St. Mary’s (Pax River NAS) | 0.81% | $3,645 | $304 |
| $650,000 | Howard (between DC and Baltimore) | 1.11% | $7,215 | $601 |
County effective rates above are from SmartAsset. [8] Your actual annual property tax is determined by the assessed value assigned by SDAT and the combined state, county, and municipal levy. [2]
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$3,645 per Year
A $450,000 home in St. Mary’s County near Pax River NAS at 0.81%, saving $304 per month in tax escrow.
$4,150 per Year
A $500,000 home in Anne Arundel County near Fort Meade at 0.83%, saving $346 per month.
$7,215 per Year
A $650,000 home in Howard County between DC and Baltimore at 1.11%, saving $601 per month.
Baltimore City has the highest effective rate in the state at roughly 1.40%. A $350,000 home in Baltimore City would carry approximately $4,900 in annual property taxes, all of which the exemption eliminates. [8]
How Does the Exemption Affect a VA Mortgage?
Maryland’s full exemption has a large impact on DTI calculations and buying power because the state has near-1% average rates and no value cap. If the exemption is documented before or at closing, the lender can set tax escrow to $0 from day one. [6] [7]
Before the Exemption
Illustrative $550,000 purchase in Prince George’s County at 6.5%. Principal and interest: $3,476. Insurance: $175. Property-tax escrow: $513.
At $8,000 monthly gross income, housing DTI would be roughly 52.1%.
After Exemption Verified
Same purchase. Approved exemption eliminates tax escrow entirely. Principal and interest: $3,476. Insurance: $175. Tax escrow: $0.
Housing DTI drops to roughly 45.6%, a reduction of 6.4 percentage points. That shift can matter for VA loan qualification when residual income is tight or compensating factors are needed.
VA Funding Fee Stacking
The federal VA funding fee exemption is a separate benefit. Veterans receiving VA disability compensation, or eligible to receive it, do not pay the funding fee. On a first-use purchase with less than 5% down, the current rate is 2.15%. On a $550,000 loan, that saves $11,825 upfront. Combined with the annual property tax exemption, a 100% P&T Veteran buying in Prince George’s County captures roughly $17,985 in first-year combined benefits ($6,160 tax savings plus $11,825 fee waiver). [6]
These are separate state and federal programs with independent eligibility. Qualifying for one does not affect the other. The funding-fee savings are a one-time cost reduction at closing. The property tax exemption is recurring annually. See Are Disabled Veterans Exempt from the VA Funding Fee? for a full breakdown. [6]
A servicing company may conduct an escrow analysis when a property tax bill changes, but is not automatically required to reanalyze immediately. If you close before the exemption is reflected in your tax bill, request an escrow reanalysis once SDAT confirms the exemption. For realistic housing-cost planning, see How Much VA Loan Can I Afford?. [7]
How Do You Apply for the Exemption?
Maryland routes the exemption through SDAT, not your county assessor or county government. This is a one-time filing. No annual reapplication is required unless your disability status changes. [1] [2] [3]
You need DD-214 and a VA certification or rating decision letter confirming 100% P&T service-connected disability with the effective date. Summary of Benefits letters are not accepted.
Download the Application for Exemption for Disabled Veteran from the SDAT website or request it from your local SDAT assessment office.
File the completed form with your VA documentation, DD-214, and proof of Maryland residency at the SDAT assessment office for the county where the property is located.
You can apply before purchasing a specific dwelling. SDAT must respond within 15 business days with a preliminary approval or denial and an estimated exemption amount.
After processing, confirm that the exemption appears on your next property tax bill showing $0 due for state, county, and municipal taxes.
If you were eligible in prior years but did not file, request a refund for up to 3 years of taxes paid. SDAT must issue refunds; interest accrues if not processed within 60 days.
Application Documents Checklist
- SDAT Form 0726-A, completed
- VA certification or final rating decision (not Summary of Benefits)
- DD-214 (discharge certificate)
- Maryland Driver’s License or prior-year Maryland tax return
- Property deed or settlement statement for new purchases
Retroactive Refund Details
Maryland provides mandatory refunds of state, county, and municipal taxes paid during the period you were eligible but had not yet filed. The refund request must be made within the 3-year period beginning with the calendar year in which you initially became eligible. Refunds are available beginning with tax year 2018-2019. [1] [2]
Active-duty service members with qualifying disabilities can also file using the same SDAT process. Each year an active-duty applicant must provide SDAT with a Certification of Active-Duty Status to continue receiving the exemption. [2]
Do Surviving Spouses Keep the Exemption?
Maryland’s surviving spouse provision covers multiple scenarios. An un-remarried surviving spouse retains the full exemption on the same dwelling. Transfer and line-of-duty-death paths also exist. [1] [2]
| Situation | Exemption Provided | Key Conditions |
|---|---|---|
| Same dwelling, previously exempt | Full exemption continues on the same property | Surviving spouse must remain un-remarried and continue to own and occupy the dwelling |
| Same dwelling, not previously exempt | Full exemption on the dwelling if the Veteran was domiciled in Maryland | Surviving spouse must have owned and occupied the property; Veteran must have been a Maryland domiciliary |
| Spouse moves to a new dwelling | Dollar-amount transfer equal to the exemption on the former dwelling | The new home gets a credit equal to the prior exemption amount, not a full exemption on the new assessed value |
| Line-of-duty death | Full exemption available to un-remarried surviving spouse | Death must have occurred while in active Military service as a result of injury or disease incurred in the line of duty |
The dollar-amount transfer provision is important when a surviving spouse downsizes or relocates within Maryland. If the original dwelling carried a $4,150 annual exemption, the new dwelling receives a $4,150 credit regardless of its assessed value. If the new home’s taxes exceed $4,150, the spouse pays only the difference. [1]
Where Do Veterans File in Maryland?
All applications go through SDAT, the Maryland State Department of Assessments and Taxation. SDAT has regional assessment offices throughout the state. File at the office for the county where your property is located. [2] [3]
| Installation | County | SDAT Office Address | Phone |
|---|---|---|---|
| Fort Meade | Anne Arundel | 45 Calvert St., 3rd Floor, Annapolis, MD 21401 | (410) 974-5709 |
| JB Andrews | Prince George’s | 14735 Main St., Suite 356B, Upper Marlboro, MD 20772 | (301) 952-2500 |
| Aberdeen PG | Harford | 2 South Bond St., Suite 400, Bel Air, MD 21014 | (410) 836-4800 |
| Pax River NAS | St. Mary’s | 23110 Leonard Hall Dr., Room 2059, Leonardtown, MD 20650 | (301) 880-2900 |
| Fort Detrick | Frederick | 5310 Spectrum Dr., Suite E, Frederick, MD 21703 | (301) 815-5350 |
All SDAT assessment offices operate from 8:00 AM to 4:30 PM. The state headquarters is located at 700 E. Pratt St., Suite 2700, Baltimore, MD 21202-6377. Applications and forms are available online at the SDAT Property Tax Exemptions page or by contacting the local office directly. [3]
For service members comparing BAH with mortgage payments near Maryland installations, use your actual SDAT-confirmed exemption and local tax rate rather than the statewide average when modeling housing costs.
Real-World Maryland Veteran Scenarios
The following cases illustrate how the exemption, the VA mortgage, and SDAT filing interact in common Maryland situations. None is a guarantee of a specific outcome. [1] [2] [6]
100% P&T Buying Near Fort Meade
The Veteran submits Form 0726-A to the Anne Arundel SDAT office before closing using the pre-purchase application option. SDAT responds within 15 business days. The lender sets tax escrow to $0 at closing. On a $500,000 purchase, that eliminates roughly $346 per month from PITI and the funding-fee exemption saves $10,750 upfront.
Veteran Who Never Filed
A Veteran in Harford County received the 100% P&T rating two years ago but never applied for the property tax exemption. The Veteran files Form 0726-A now and also requests a retroactive refund for two years of taxes paid. On a $475,000 home at 0.80%, the retroactive refund could total roughly $7,600.
Spouse Stays in the Same Dwelling
The un-remarried surviving spouse of a 100% P&T Veteran continues to own and occupy the Fort Meade-area home. The full exemption remains in effect. No reapplication is required unless the spouse moves. The same 3-year retroactive refund provision applies if the spouse was not previously receiving the benefit.
Rating Received After Closing
A Veteran closed on a VA loan in Prince George’s County and received the 100% P&T rating six months later. The Veteran applies immediately and requests a retroactive refund for the months of eligibility. The lender is notified to conduct an escrow reanalysis once the exemption is confirmed on the tax bill.
What About Partial Ratings, IU, and Special Properties?
Maryland’s exemption is all-or-nothing at the 100% P&T threshold. There is no partial or tiered exemption for lower disability ratings at the state level. Here are the most common edge cases. [1] [2]
| Situation | Exemption Status | What to Do |
|---|---|---|
| Below 100% P&T | No state-level property tax exemption | Check with your county for potential local tax credits |
| IU (TDIU) | May qualify if VA documentation states 100% P&T for compensation purposes | Confirm with SDAT that your specific VA letter meets the requirement |
| Condo or townhome | Qualifies as a dwelling used as primary residence | File normally with SDAT |
| Duplex (2 families) | Qualifies under the two-family dwelling provision | File normally; the entire dwelling is exempt |
| Triplex or larger | Does not qualify; statute limits to two families | No exemption available under §7-208 |
| Vacant land | Not covered; must have a dwelling house | Build first, then file once occupied as primary residence |
| Homestead Tax Credit | Irrelevant if fully exempt; your tax bill is already $0 | The Homestead Credit (10% annual assessment increase cap) benefits taxpayers, not exempt owners |
Some Maryland counties offer additional local property tax credits that may benefit Veterans rated below 100% P&T. These are county programs, not state programs, and eligibility varies. Contact your county government directly to ask about locally administered Veteran tax credits. Use the VA disability calculator to estimate your combined rating if you have multiple conditions. [2]
What Mistakes Can Cost You the Exemption?
The biggest mistakes are waiting too long to file, using the wrong VA document, and failing to coordinate with your VA loan team. [1] [2]
Before You File
- Verify your VA letter confirms 100% P&T, not just 100% schedular
- Use the full VA rating decision, not the Summary of Benefits letter
- Have your DD-214 and Maryland residency proof ready
- Use the pre-purchase application option if you have not yet closed
- File with the SDAT office for the county where the property is located, not the county government
- Ask SDAT about retroactive refund eligibility before the 3-year window closes
Before You Budget for a Home
- Tell your lender about the exemption during VA loan preapproval for accurate escrow
- Do not assume $0 escrow until SDAT confirms the exemption
- Separate the one-time funding-fee savings from the recurring property tax exemption
- Use your county’s actual rate, not the statewide average
- If the exemption is pending, the lender may underwrite using current payable taxes
- Request an escrow reanalysis after the exemption appears on the tax bill
Frequently Asked Questions
Quick answers to the questions Maryland Veterans ask when evaluating property tax relief in 2026.
How much does a 100% disabled Veteran save on property tax in Maryland?
A qualifying Veteran pays $0 property tax on the dwelling. On a $500,000 home at the statewide average rate of 0.95%, that saves roughly $4,750 per year or $396 per month. Savings depend on the assessed value and the combined state, county, and municipal rate. [8]
Does the Maryland exemption have an income limit or home value cap?
No. Maryland’s exemption under §7-208 has no income test, no home value cap, and no expiration. If you are 100% service-connected permanently and totally disabled, the exemption covers the entire dwelling regardless of value.
Do Veterans with partial disability ratings qualify?
No. Maryland’s state-level property tax exemption requires 100% service-connected permanent and total disability. Veterans rated below 100% should check with their county for potential local tax credits.
Can I get a refund for years I was eligible but did not file?
Yes. Maryland provides mandatory refunds for state, county, and municipal taxes paid during the period you were eligible but had not yet filed, if you apply within 3 years of the calendar year when you initially became eligible. Interest accrues on refunds not processed within 60 days.
Should I apply before or after closing on my VA loan?
Maryland allows pre-purchase applications. SDAT must respond within 15 business days with a preliminary approval or denial. Applying before closing lets the lender set tax escrow to $0 from day one. If you apply after closing, request an escrow reanalysis once SDAT confirms the exemption.
Does IU (Individual Unemployability) qualify for the exemption?
If your VA documentation states 100% permanent and total disability for compensation purposes due to IU, you may qualify. The key is what the VA rating decision letter says. Confirm with SDAT that your specific documentation meets the §7-208 requirement.
Can I combine the exemption with the VA funding fee waiver?
Yes. The Maryland property tax exemption is a state benefit. The VA funding-fee exemption is a federal benefit. They have independent eligibility and stack without interference.
Does the exemption affect my VA loan qualification?
A verified exemption reduces the tax component of your monthly PITI, which improves DTI. On a $500,000 home, eliminating $346 per month in taxes can lower housing DTI by several percentage points. The lender must verify the exemption before adjusting escrow. [8]
Can I get the exemption on a condo or townhome?
Yes. The exemption applies to any dwelling house that is the Veteran’s primary residence and is occupied by no more than two families. Condos, townhomes, and single-family homes all qualify.
Does the exemption transfer if I move within Maryland?
File a new Form 0726-A with SDAT for the new property. The full exemption applies to the new dwelling as long as you continue to meet the disability and residency requirements. For surviving spouses who move, the exemption transfers as a dollar amount, not a full exemption on the new home.
Does the Homestead Tax Credit stack with the Veteran exemption?
If you have the full Veteran exemption, the Homestead Tax Credit is irrelevant because your tax bill is already $0. The Homestead Credit limits assessment increases to 10% per year and benefits homeowners who pay taxes.
How long does SDAT take to process the exemption?
Processing times vary. For pre-purchase applications, SDAT must respond within 15 business days. For standard applications, contact SDAT after filing to confirm receipt and ask for an estimated timeline. The exemption takes effect for the tax year in which it is approved.
Sources and Verification Method
This article relies on the current Maryland statute, SDAT guidance, VA.gov funding-fee rules, and CFPB escrow regulations. Every claim is traceable to a primary source listed below. [1] [2] [6]
- Maryland Tax-Property Article §7-208. Disabled Veteran property tax exemption: qualifying individuals, dwelling coverage, surviving spouse provisions, pre-purchase application, retroactive refunds, and 15-business-day response requirement.
- Maryland SDAT: Property Tax Exemptions. Eligibility, Form 0726-A, required documentation (VA certification or rating decision, not Summary of Benefits), residency proof, surviving spouse rules, retroactive refund mechanics, and local assessment office directory.
- Maryland SDAT: Assessment Office Directory. County-level SDAT office addresses, phone numbers, supervisors, and hours of operation for all 24 jurisdictions.
- U.S. Department of Veterans Affairs: Disability Compensation. VA disability rating decisions, benefit letters, and what 100% service-connected permanent and total disability means.
- Maryland SDAT: Real Property Division. Tax exemption application forms, property assessment process, and links to tax credit programs.
- U.S. Department of Veterans Affairs: VA Funding Fee. 2.15% first-use purchase rate (less than 5% down), disability-based fee exemption categories, and closing-cost treatment.
- Consumer Financial Protection Bureau: Mortgage Servicing FAQs. Escrow-account analysis timing, shortage and surplus definitions, and servicer obligations when tax bills change.
- SmartAsset: Maryland Property Tax Calculator. Statewide average effective rate (0.95%) and county-level rates: Anne Arundel (0.83%), Prince George’s (1.12%), Harford (0.80%), St. Mary’s (0.81%), Howard (1.11%), Baltimore City (1.40%).
What We Verified
Maryland statutory text, SDAT eligibility guidance, Form 0726-A documentation requirements, retroactive refund mechanics, surviving spouse transfer rules, pre-purchase application timeline, SDAT office locations, VA funding-fee rates, CFPB escrow-analysis rules, and county-level effective tax rates from SmartAsset.
What Must Be Checked Locally
Specific assessed value of your property, combined state/county/municipal tax rate for your jurisdiction, processing timeline for your application, and any county-level Veteran tax credits that may supplement the state exemption.
Know Your Tax Exemption Before You Choose a Mortgage.
File with SDAT using Form 0726-A and your VA rating documentation. Then ask a VA loan specialist to review the complete housing payment, fee status, and qualification picture with the exemption reflected.