ROCHESTER, N.Y. (WROC) — CPA Scott Adair from the New York State Society of CPAs discussed some of the tax breaks available for veterans on Monday, Veterans Day during News 8 at Sunrise.
Adair explained how veterans can take advantage of tax credits, some educational benefits, and some property tax exemptions.
“The biggest one out there is the Earned Income Tax Credit,” Adair said of tax credits for veterans. “We’ve heard a lot about this credit for low and moderate-income families to be able to take advantage of reduced payroll tax impact to them from a tax perspective. Ultimately the reason why military veterans are eligible for this is that combat pay is excluded from their income in order to calculate whether or not they’re eligible for the benefit. So the bottom line here is they can reduce their tax impact at the end of the day by having lower payroll taxes withheld from their paychecks.”
Veterans wounded in combat have a relatively new credit available. “In 2017 the Combat-injured Veterans Tax Fairness Act was put into law,” Adair said. “All lump-sum benefits that a veteran received by a combat wound, effectively become tax-free. So they can go all the way back to January of 1991, and claim that credit on their income taxes moving forward.”
Adair noted the Post-9/11 GI Bill is an education benefit program for service members and veterans who served active duty on or after Sept. 11, 2001. You are eligible if you collectively served at least 90 days of active duty on or after Sept.11, 2001 or were honorably discharged from active duty for a service-related disability after serving 30 continuous days following September 10, 2001. “It can be used for all different types of schooling – colleges, universities, trade schools, just on the job training type things,” he said. “Veterans are eligible for up to $1,000, and includes tuition, housing allowances, and it can be used for books and supplies in the classroom.”
For housing, Adair said New York State and local municipalities offer lower tax assessments on their value of their properties. “What I would say here is you really probably need to reach out to your local municipality and the assessor’s office to determine what breaks you’re actually eligible for. Combat veterans could be eligible for more significant tax breaks from that perspective.”
He added, “The VA has some very interesting loan programs as far as affordable housing goes. Certainly, you can look at no down payment, no private mortgage interest, and also no early payment penalties.”
Adair said to go to the U.S. Department of Veterans Affairs website to determine what breaks are out there and you may be eligible to receive.