Disabled Veteran Benefits in Arizona

This is the new Arizona exemption people are searching for. State law now says the primary residence of a veteran whose service-connected rating is 100%, or whose status is total disability based on individual unemployability (TDIU), is fully exempt from taxation. The rewritten law applies to tax years starting after December 31, 2026, which means tax year 2027.

Below 100%, and for any nonservice-connected rating, the exemption is a dollar amount off your assessed value multiplied by your rating percentage. The law's base figure is $4,188 and the Department of Revenue increases it each year; for 2026, Maricopa County lists it as up to $4,873. Whatever you cannot use on real property can go against your vehicle registration.

Tax year 2026 is still run under the old rules. Maricopa County applies an income limit to every applicant, including 100% veterans ($39,865 for a household with no children under 18), and counts only a combined 100% rating, not unemployability. If that kept you out, apply again for 2027. You file with your county assessor, and Maricopa's deadline is February 28th. The surviving spouse of a veteran who qualified at 100% or through unemployability keeps the full exemption on a primary residence until remarriage.

At 100% the cost of registering a car goes away. The Motor Vehicle Division waives both the vehicle license tax and the registration fee for a veteran certified as 100 percent disabled by the VA. It covers one vehicle. A surviving spouse keeps it until remarriage.

Two other groups get the same waiver on one vehicle: honorably discharged Purple Heart recipients, and veterans who bought the vehicle with VA financial aid. Fee exemptions cannot be claimed online. You apply in person or by mail.

The plate the Motor Vehicle Division offers veterans is the Veteran plate. It is open to any veteran, costs $25 to get and $25 a year to renew, and can carry the disability symbol on request. It does not come with a fee waiver; that is the separate 100% exemption above.

Arizona does not tax a military pension. The state excludes benefits, annuities and pensions received as retired or retainer pay of the uniformed services, and since tax year 2021 the exclusion is the full amount received.

Active duty pay has been untaxed since 2006, and the same goes for pay for active service as a Reservist or National Guard member. A full-year resident takes the active duty subtraction on Form 140.

Arizona's Tuition Waiver is narrower than the name suggests. A veteran qualifies with all three of these: a Purple Heart, Arizona residency or an Arizona duty station when wounded, and a VA rating of 50% or more. It waives tuition for the credits needed for an undergraduate degree at the state universities and community colleges.

The family tiers are for survivors: an unremarried spouse, or a child up to age 30, of a service member who was killed in the line of duty. Children of living disabled veterans are not on the list, whatever the rating.

Spouses have a better route. The Board of Regents' Veteran Spouses program gives the Arizona-resident spouse of any honorably discharged veteran free tuition, up to in-state tuition and mandatory fees after other aid, on a first-come, first-served basis. And a veteran, or a veteran's spouse or dependent, who is using VA education benefits after a discharge from 90 days or more of active duty can be granted immediate residency for in-state rates by living in Arizona and showing a tie such as an Arizona driver license.

The Arizona Game and Fish Department issues a Disabled Veteran License at no fee to a veteran whose VA letter says 100% disabled, permanent and total. State law adds one condition: you must have lived in Arizona for a year or more before applying.

If you draw compensation for a service-connected rating under 100% the license is $42, and Purple Heart recipients pay $28. The same one-year residency rule applies.

State parks split the same way but ask only for proof of a 100 percent service-connected disability: that gets a free day-use pass, and it covers up to three adults who come with you. Retired military and service-disabled veterans under 100% get 50% off day-use entry. Both are for day entry only, not camping.

Arizona's preference covers jobs with the state and its political subdivisions, which means counties and cities that hire under a merit system. A veteran separated under honorable conditions after more than six months of active duty gets 5 points. If you have a service-connected disability, or draw VA compensation, you get 10 points, and 10 is the most anyone can receive.

The points are added only after you pass: you have to earn a passing grade without them. For state jobs the preference is for outside candidates, not current state employees. The spouse or surviving spouse of a veteran with a total, permanent service-connected disability gets the 5-point preference too.

The Military Family Relief Fund is open to both pre-9/11 and post-9/11 veterans and covers basic living costs such as rent, vehicle payments or utilities. It does not pay VA debts, credit cards, child support or legal fees.

You need three things: a deployment outside the continental United States and its territories, an Arizona tie (home of record, Arizona Guard, deployed from an Arizona base, or 12 months of continuous residence), and a hardship your military service caused. First-time applicants can ask for a one-time emergency grant of up to $3,000, which counts toward the $20,000 lifetime limit. Checks go to your landlord or utility, not to you.