Disabled Veteran Benefits in Kentucky

This is the most searched question about Kentucky and the answer disappoints people. A 100% rating does not erase the bill. The state's only break is the homestead exemption, the same one every homeowner gets at 65. You qualify earlier if you have been classified as totally disabled under a program run by a federal agency, and you must have received disability payments for the entire assessment period.

For the 2025-2026 assessment years the exemption is $49,100. It comes off the assessed value, not off the tax. The state's own example: a home assessed at $200,000 is taxed as if it were worth $150,900. What that saves in dollars depends on your local tax rates. Only one exemption applies per home, so being both 65 and disabled does not double it.

Veterans do get a break on the paperwork. The general rule is that a totally disabled homeowner under 65 must apply again every year. A service-connected totally disabled veteran documents the disability once and does not have to apply again. The same goes for people found totally and permanently disabled by Social Security or the Kentucky Retirement Systems. File with the property valuation administrator (PVA) in your county.

Kentucky law sets the fee at $0, initial and renewal, for three groups: veterans the VA has declared 100% service-connected disabled, disabled veterans who received VA assistance to buy a vehicle, and Medal of Honor recipients. You fill in form TC 96-217 for your county clerk and attach a copy of your VA authorization. The form has you certify that you are a Kentucky resident.

Rated 50% to 99%? You can still have the Disabled Veteran plate, but the fee is $23 when it is issued and $23 at each renewal, and the law adds the other standard registration fees on top. Disabled veteran plates expire on July 31.

Two limits to know. The free plate does not waive vehicle taxes: the form tells clerks to collect any usage tax or ad valorem tax that applies and only skip the registration fee. And the Veteran designation on a driver's license or ID is open to any honorably discharged veteran, at any rating. Apply in person at a Driver Licensing Regional Office with proof such as a DD-214 or a VA ID card.

The Kentucky Dependent Tuition Waiver covers children, stepchildren, spouses and unremarried widows and widowers. It applies when the veteran is 100% service-connected disabled, is totally disabled from a non-service cause with wartime service, or died on active duty or from a service-connected disability. The veteran must be a current Kentucky resident. The student does not have to be.

It waives tuition only, not room and board, books or fees, and only at two-year, four-year and vocational-technical schools the state operates. Private and out-of-state schools do not qualify. The waiver ends when the student receives a degree or certificate or has used 45 months of classes. For a child it also ends at age 26. KDVA says there is no age limit for the spouse.

It is a different thing from the federal benefit. Chapter 35 is a monthly cash stipend, while the waiver simply removes the tuition bill. Apply to KDVA once the school has accepted you, and allow at least 30 days.

The license is not free, but it is close. Kentucky residents at least 50% disabled from a service-connected disability can buy the Disabled Sportsman's License for $12.68. It includes the combination hunting and fishing license, all deer permits, both turkey permits, the migratory bird and waterfowl permit and the trout permit. The regular resident Sportsman's License with the same contents is $100.42. Send Fish and Wildlife a VA letter showing at least 50 percent. The authorization lasts three years. The license itself runs through the end of February each year.

State parks reward the 100% rating. A Kentucky resident who is 100% disabled from a service-connected cause gets three free overnight stays per calendar year, up to three nights each, in a lodge room, cottage or campsite, subject to availability. You reserve by calling the park no more than ten days ahead and bring your VA letter and proof of residency. From Memorial Day to Labor Day and in October, stays must fall Sunday through Thursday.

VA disability compensation is not taxed. The IRS says not to include in your income any veterans' benefits paid under a law the VA administers, and it lists disability compensation by name. Kentucky law works out your income from the federal figures and excludes income that federal law exempts from state tax.

Military retired pay is different. The state lets everyone exclude up to $31,110 of pension and retirement income. Retired military may be able to exclude more, worked out on Schedule P. KDVA's benefits summary says retired pay of members who retired before January 1, 1998 is completely exempt. Active duty pay is not taxed at all.

Older guides still describe preference points for veterans and extra points for disabled veterans. Points ended on June 27, 2019, when Kentucky replaced preference points with interview preference. The current statute lists who gets the preference and does not mention a disability rating.

The preference covers anyone who served in the Armed Forces, Reserves or National Guard and left with an honorable or general discharge, plus current members, spouses and unmarried widows and widowers. You must meet the minimum qualifications for the job. If fewer than five preference candidates qualify, the agency must offer all of them an interview. If five or more qualify, it must interview at least five.

It applies only to competitive classified positions and only to a first appointment, not to internal moves by people already in state government.

Kentucky Veterans Centers are skilled nursing homes. To be admitted you must be a veteran with a discharge that is not dishonorable, need nursing care, and be a Kentucky resident on the day of admission. The page lists no minimum rating. The centers ask for your VA award letter only if you are paid at 70% or more.

State veterans cemeteries give the veteran a gravesite, opening and closing, a headstone and perpetual care at no cost. There is a five-hundred-dollar fee for a spouse, due only at the time of death. You do not have to be a Kentucky resident.

The Veteran Homeless Prevention Grant pays rent, electric, gas or water bills, up to $750 a year, straight to the landlord or utility. You need a general or honorable discharge and income under the program's limit for your family size.