New Mexico 100% Disabled Veteran Property Tax Exemption: What You Need to Know
New Mexico exempts from property taxation the primary residence of veterans determined by federal law to have a 100 percent permanent and total service-connected disability. The property must be occupied by the veteran as their principal place of residence. Surviving spouses who were married to the veteran at the time of death and continue to occupy the property may also qualify. The exemption applies only if claimed and allowed through the county assessor.
Quick Facts
| Item | Details |
|---|---|
| Benefit | Full property tax exemption on primary residence |
| Eligibility | Veterans with 100% permanent and total service-connected disability |
| Application | Certificate from NMDVS + county assessor form |
| Processing Time | Varies by county; typically 30-60 days |
| Official Agency | New Mexico Department of Veterans Services / County Assessor |
| Required Forms | NMDVS Certificate of Eligibility, County Exemption Form |
| Updated For | 2026 Tax Year |
What Is the New Mexico 100% Disabled Veteran Property Tax Exemption?
The New Mexico 100% disabled veteran property tax exemption is a complete elimination of property taxes on a qualifying veteran’s primary residence. Under New Mexico Statutes Section 7-37-5.1, veterans who have been honorably discharged and determined pursuant to federal law to have a 100 percent permanent and total service-connected disability qualify for this exemption.
This is not a partial exemption or a tax reduction. It is a full exemption on the veteran’s principal place of residence. Qualifying veterans pay zero property taxes on their primary home.
Why this matters: New Mexico has no state income tax on military retirement pay, making the state attractive to veterans. Eliminating property taxes further reduces the financial burden for disabled veterans living on fixed incomes.
What veterans should do next: Contact the New Mexico Department of Veterans Services (NMDVS) to obtain a Certificate of Eligibility, then present the original certificate to your county assessor’s office.
Who Qualifies for the New Mexico 100% Disabled Veteran Exemption?
To qualify for the full New Mexico property tax exemption, a veteran must meet all of the following requirements:
Honorable Discharge: Have been honorably discharged from the armed forces of the United States. The discharge must be other than dishonorable or bad conduct.
100% Permanent and Total Disability: Be determined pursuant to federal law to have a 100 percent permanent and total service-connected disability.
Property Ownership: Own the property for which the exemption is claimed. The exemption applies to property owned solely by the veteran or held as joint or community property with the veteran’s spouse.
Primary Residence: Occupy the property as the veteran’s principal place of residence.
New Mexico Property: The property must be located in New Mexico.
Who Does Not Qualify
Veterans with disability ratings below 100%
Veterans whose 100% rating is not designated as permanent and total
Veterans who do not own their primary residence
Veterans whose property is not used as their principal residence
Veterans who received a dishonorable or bad conduct discharge
Important distinction: The 100% disabled veteran exemption requires a 100% permanent AND total service-connected disability rating. Veterans with lower ratings now qualify for a proportional exemption based on their disability percentage under 2026 changes.
Expanded Eligibility for Veterans with Less Than 100% Disability (2026 Changes)
Veterans May Qualify for Extra Benefits
Check available financial assistance, healthcare programs and other opportunities that may apply to you.
Check EligibilityBeginning in tax year 2026, New Mexico expanded the disabled veteran property tax exemption to include veterans with service-connected disability ratings below 100%. This change resulted from voter approval in November 2024 and was implemented through House Bill 285 during the 2026 New Mexico Legislative Session.
How the Proportional Exemption Works
Veterans with a VA-determined disability rating below 100% can now receive a partial property tax exemption proportional to their disability percentage. For example:
A veteran with a 60% disability rating would have 60% of their property tax exempt
A veteran with a 70% disability rating would have 70% of their property tax exempt
A veteran with a 100% disability rating continues to receive a full 100% exemption
Example Calculation
A veteran with a 70% disability owns a residential property valued at $300,000:
| Description | Amount |
|---|---|
| Assessed Value | $300,000 |
| Taxable Value (1/3) | $100,000 |
| Head of Family Exemption | -$2,000 |
| Sub Total | $98,000 |
| Veteran Exemption | -$10,000 |
| Sub Total | $88,000 |
| Disabled Vet Exemption (70%) | -$61,600 |
| Adjusted Taxable Value | $26,400 |
In this example, the veteran would pay property tax on $26,400 rather than the full $100,000 taxable value.
Understanding the Standard Veteran Exemption
In addition to the disabled veteran exemption, New Mexico offers a standard veteran property tax exemption. Understanding both exemptions is important because they can be combined.
Standard Veteran Exemption Amount
The standard veteran exemption was increased from $4,000 to $10,000 for 2025 and will increase automatically and annually based on the rate of inflation.
Who Qualifies for the Standard Veteran Exemption
Any veteran who is a New Mexico resident and owns property in the state may qualify for the standard veteran exemption. The exemption can be applied to property tax or motor vehicle tax.
How the Exemptions Stack
The two exemptions are applied in order. The standard veteran exemption ($10,000) is applied first, followed by the disabled veteran exemption based on the disability percentage.
| Exemption Order | Exemption Type | Amount |
|---|---|---|
| 1st | Standard Veteran Exemption | $10,000 |
| 2nd | Disabled Veteran Exemption | Percentage of remaining taxable value |
How to Apply for the New Mexico 100% Disabled Veteran Exemption
Step-by-Step Application Process
Step 1: Obtain Your VA Award Letter
Sign in to your account on VA.gov to access your VA award letter showing your disability percentage. Alternatively, you can contact a VA Regional Office to request a copy by mail, or ask your Veteran Service Officer or attorney to access it through the Veterans Benefits Management System.
To get your VA award letter online:
Sign in to your account on VA.gov
Click on “VA Benefits and Health Care”
Select “Disability” from the dropdown menu
Choose “Check your claim, decision review, or appeal status”
Find the relevant claim and click on it
Click on “Get your claim letters”
Your decision letter(s) will appear as a PDF that you can print or save
Step 2: Visit Your Local NMDVS Office
Bring your documents to your nearest New Mexico Department of Veterans Services office where you can complete the NMDVS application for Veteran Tax Exemption and Disabled Veteran Tax Exemption (DVS Form 1, revised March 2025). The NMDVS Veterans Service Officer will verify your information and give you a certificate.
Step 3: Gather Required Documents
You will need:
Copy of your DD-214 (Member Copy 4 for veterans discharged after the 1970s) showing the nature of your discharge
Proof of New Mexico residency (driver’s license, voter registration, or state tax return)
VA Award letter showing your percentage of medical disability
Death certificate and marriage certificate (for surviving spouses)
Step 4: Present Certificate to County Assessor
After receiving your Certificate of Eligibility from NMDVS, present the original to your county assessor’s office. The assessor will confirm the exemption declaration.
Step 5: Complete County Certification Form
You will need to complete a certification form confirming that you own the property and occupy it continuously as your principal place of residence. The form must be accompanied by your NMDVS Certificate of Eligibility and presented at the time the exemption is initially claimed and upon any change in ownership.
Application Deadline
The exemption applies only if claimed and allowed in accordance with Section 7-38-17 NMSA 1978. Notices of Value are typically mailed on April 1 each year, and residents have 30 days from the mailing date to apply for exemptions, benefits, or to file property valuation appeals.
Required Documents for the New Mexico Disabled Veteran Exemption
| Document | Purpose | Notes |
|---|---|---|
| DD-214 (Member Copy 4) | Proves honorable discharge | Required for all applicants |
| VA Award Letter | Proves disability percentage | Must be current |
| Proof of NM Residency | Confirms residency | Driver’s license, voter registration, or tax return |
| NMDVS Certificate of Eligibility | State verification | Issued by NMDVS |
| County Certification Form | Confirms occupancy | Signed under penalty of misdemeanor |
| Marriage Certificate | For surviving spouse applicants | Proves relationship to veteran |
| Death Certificate | For surviving spouse applicants | Required if applying as surviving spouse |
Common mistake: Submitting a VA letter that does not clearly state “permanent and total” disability. Request a benefits summary letter from the VA that explicitly confirms your rating status.
Surviving Spouse Benefits in New Mexico
Who Qualifies as a Surviving Spouse?
The surviving spouse of a 100% disabled veteran may continue receiving the exemption if:
The surviving spouse and the disabled veteran were married at the time of the disabled veteran’s death
The surviving spouse continues to occupy the property continuously after the disabled veteran’s death as the spouse’s principal place of residence
Required Documents for Surviving Spouse
Surviving spouses must provide additional documentation:
Marriage certificate
Death certificate
The veteran’s VA Award letter showing 100% permanent and total disability
Transferring the Exemption
Upon the transfer of the principal place of residence of a disabled veteran or surviving spouse entitled to and granted a disabled veteran exemption, the veteran or surviving spouse may choose to:
Maintain the exemption for that residence for the remainder of the year, even if the residence is transferred during the year
Remove the exemption for that residence and apply it to the new principal place of residence
Transferring the Exemption to a New Property
If a 100% disabled veteran moves to a new primary residence in New Mexico, they can transfer the exemption to the new property. The process involves:
Notifying the county assessor of the change in residence
Filing a new certification form with the new property information
Presenting the NMDVS Certificate of Eligibility
Important: The exemption may be transferred even if the claim was not filed within the usual 30-day window after the county assessor’s notice of valuation.
New Mexico vs. Other States: Disabled Veteran Property Tax Benefits
| State | 100% Disabled Veteran Benefit | Surviving Spouse Benefit |
|---|---|---|
| New Mexico | Full exemption on primary residence | Full exemption (if not remarried) |
| Texas | Full exemption on homestead | Full exemption (if not remarried) |
| Florida | Full exemption on homestead | Full exemption (if not remarried) |
| Virginia | Full exemption on primary residence + 1 acre | Full exemption (if not remarried) |
| California | $180,671-$271,009 exemption | Yes (if not remarried) |
New Mexico is among the most generous states for disabled veteran property tax benefits, offering a complete exemption with no income limits and a proportional exemption for veterans with lower disability ratings.
Common Mistakes When Applying for the New Mexico Exemption
Insufficient VA documentation: The VA letter must clearly state “100% permanent and total” disability. General benefit letters may not be sufficient.
Not visiting NMDVS first: The county assessor requires a Certificate of Eligibility from NMDVS. You must visit NMDVS before going to the assessor’s office.
Missing the 30-day deadline: Applications for exemptions must typically be filed within 30 days of the mailing of the Notice of Value.
Forgetting to notify the assessor of changes: If you move or your eligibility changes, you must notify the assessor. Failure to respond to verification requests can result in loss of the exemption.
Not providing Member Copy 4 of DD-214: For veterans discharged after the 1970s, the Member Copy 4 showing the nature of discharge is required.
Assuming automatic renewal without verification: While the exemption generally continues as long as there is no change in eligibility or ownership status, you should verify your exemption is applied each year on your Notice of Value.
Not applying for both exemptions: Veterans may qualify for both the standard veteran exemption ($10,000) and the disabled veteran exemption. Ensure both are applied.
Appealing a Denied Exemption Application
If your application for the New Mexico disabled veteran property tax exemption is denied, you have options:
Step 1: Request an Explanation
Contact your county assessor’s office to understand why your application was denied.
Step 2: Provide Additional Documentation
If the denial was due to missing or unclear documents, you may be able to resolve the issue by providing additional information.
Step 3: File a Protest
House Bill 285 creates a process for claimants to protest a pending or denied exemption. Contact your county assessor for specific protest procedures.
Step 4: Seek Assistance
The New Mexico Department of Veterans Services can provide guidance on the appeals process. The veterans’ services department is required to assist the taxation department and county assessors in determining eligibility.
Latest Changes to New Mexico Veteran Property Tax Exemptions
2026 Legislative Changes (HB 285)
House Bill 285, signed into law in 2026, makes significant changes to the disabled veteran property tax exemption:
Expanded eligibility: Veterans with service-connected disability ratings below 100% can now receive a proportional exemption based on their disability percentage
Clarified definitions: The bill clarifies who qualifies as a “disabled veteran”
Joint and community property: Confirms the exemption applies to joint or community property and certain grantor trust-held property
Surviving spouse protections: Preserves the exemption for surviving spouses who continue to occupy the home
Transferability: Allows the exemption to remain on the old residence for the remainder of the tax year or transfer to a new principal residence
Multiple owners: Directs assessors to use the highest disability percentage among eligible owners
Protest procedures: Creates a process for claimants to protest a pending or denied exemption
Pending claims: Provides a path for veterans whose federal disability claim is still pending
Standard Veteran Exemption Increase
The standard veteran exemption increased from $4,000 to $10,000 for 2025 and will increase automatically and annually based on the rate of inflation.
Common Questions
1. Do I need to reapply for the New Mexico disabled veteran exemption every year?
No. If the exemption was previously claimed and allowed, it applies to subsequent years as long as there is no change in eligibility or ownership status. However, you should verify your exemption is applied each year on your Notice of Value.
2. What is the deadline to apply for the New Mexico disabled veteran exemption?
Notices of Value are typically mailed on April 1 each year. Residents have 30 days from the mailing date to apply for exemptions, benefits, or to file property valuation appeals.
3. Can I receive the exemption on a second home or rental property?
No. The exemption applies only to your principal place of residence. You must own and occupy the property as your primary residence.
4. What happens to the exemption if my spouse dies?
If you are the surviving spouse and were married to the veteran at the time of death, the exemption carries over to you as long as you continue to occupy the property continuously as your principal place of residence.
5. Can I transfer the exemption if I move to a new home in New Mexico?
Yes. Upon transfer of the principal place of residence, you may either maintain the exemption for the old residence for the remainder of the year or apply it to your new principal place of residence.
6. Is there an income limit for the New Mexico 100% disabled veteran exemption?
No. There is no income limit for the 100% disabled veteran property tax exemption.
7. What documentation do I need from the VA?
You need a VA Award letter showing your 100% permanent and total service-connected disability rating. This can be obtained through your VA.gov account or by contacting a VA Regional Office.
8. Do I need to visit NMDVS before the county assessor?
Yes. Veterans must apply for the disabled certificate of eligibility with the New Mexico Department of Veterans Services (NMDVS). After registration, NMDVS issues a state certificate, and the veteran must present the original to the county.
9. What happens if I have less than 100% disability?
Beginning in 2026, veterans with service-connected disability ratings below 100% can receive a proportional exemption based on their disability percentage. For example, a 60% disability rating would result in 60% of property tax being exempt.
10. Can I receive both the standard veteran exemption and the disabled veteran exemption?
Yes. The standard veteran exemption ($10,000) is applied first, followed by the disabled veteran exemption based on the disability percentage.
11. What is the penalty for improperly claiming the exemption?
A person who intentionally claims and receives the benefit of an exemption to which the person is not entitled is guilty of a misdemeanor and shall be punished by a fine of not more than $1,000.
12. Does the exemption cover personal property taxes?
No. The disabled veteran exemption applies only to real property taxes on your primary residence.
Key Takeaways
New Mexico offers a full property tax exemption on the primary residence for veterans with a 100% permanent and total service-connected disability
Beginning in 2026, veterans with disability ratings below 100% can receive a proportional exemption based on their disability percentage
Surviving spouses who were married to the veteran at the time of death and continue to occupy the property may qualify
Apply by obtaining a Certificate of Eligibility from NMDVS, then presenting it to your county assessor
Required documents include DD-214 (Member Copy 4), VA Award letter, and proof of New Mexico residency
The standard veteran exemption increased to $10,000 for 2025 and will increase with inflation
There are no income limits for the 100% disabled veteran exemption
The exemption can be transferred to a new principal residence if you move
HB 285 (2026) expanded eligibility, clarified definitions, and created protest procedures
Annual verification of your exemption on your Notice of Value is recommended
Official Resources
New Mexico Department of Veterans Services: dvs.nm.gov
New Mexico Statutes Section 7-37-5.1: law.justia.com/codes/new-mexico/
New Mexico Taxation and Revenue Department: tax.newmexico.gov
VA Benefits Hotline: 1-800-827-1000
USA.gov Veterans Benefits: usa.gov/veterans-benefits
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