Bill
Bill > SF2124
IA SF2124
IA SF2124A bill for an act relating to the disabled veteran homestead tax credit and including effective date and retroactive applicability provisions.
summary
Introduced
01/27/2026
01/27/2026
In Committee
01/27/2026
01/27/2026
Crossed Over
Passed
Dead
Introduced Session
91st General Assembly
Bill Summary
Current Code section 425.15 provides a homestead credit to the owner of a homestead for the full amount of property tax levied if the owner is any of the following: (1) a veteran of any of the military forces of the United States who acquired the homestead under specified federal programs; (2) a veteran with a permanent service-connected disability rating of 100 percent or a permanent and total disability rating based on individual unemployability that is compensated at the 100 percent disability rate; (3) a former member of the national guard of any state who meets specified service requirements with a permanent service-connected disability rating of 100 percent or a permanent and total disability rating based on individual unemployability that is compensated at the 100 percent disability rate; or (4) an individual who is a surviving spouse or a child and who is receiving federal dependency and indemnity compensation. This bill creates two additional categories of disabled veterans who qualify for a homestead credit under Code section 425.15 that are phased in over a period of years based on the individual’s permanent service-connected disability rating. Under the bill, if the owner of a homestead does not meet the criteria under current law for a disabled veteran homestead tax credit, the amount of the credit allowed on the homestead is the greater of the amount of the regular homestead credit (an amount equal to the actual levy on the first $4,850 of actual value) or an amount equal to a percentage of the entire amount of the tax levied on the homestead that is equivalent to the owner’s service-connected disability rating percentage if the owner is either of the following: (1) a veteran with a permanent service-connected disability rating that is less than 100 percent but equal to or greater than the percentage applicable to the specific year of the phase in; or (2) a former member of the national guard of any state who meets specified service requirements with a permanent service-connected disability rating of less than 100 percent but equal to or greater than the percentage applicable to the specific year of the phase in. The bill takes effect upon enactment and applies retroactively to homestead credit claims filed on or after January 1, 2026, for credits allowed against property taxes due and payable in fiscal years beginning on or after July 1, 2027.
AI Summary
This bill expands eligibility for the disabled veteran homestead tax credit, which provides a credit for property taxes levied on a home. Currently, this credit is available to veterans with a 100% permanent service-connected disability or a permanent and total disability compensated at the 100% rate, among other categories. The bill introduces a phased-in approach for veterans and former National Guard members with less than a 100% permanent service-connected disability rating, allowing them to receive a credit equal to a percentage of their property tax that matches their disability rating. This percentage will increase over several years, starting with 70% disability eligibility for taxes due in fiscal year 2027-2028, then dropping to 40% for taxes due in 2028-2029, and finally to 10% for taxes due in 2029-2030 and beyond. If a veteran doesn't qualify for this new credit, they will still receive the regular homestead credit, which covers the tax on the first $4,850 of their home's value, or the new disabled veteran credit, whichever is greater. The bill also clarifies that the credit can continue to the estate or surviving spouse of a deceased owner and that electing this credit means a veteran cannot claim other property tax exemptions for military service. The changes take effect immediately upon enactment and apply retroactively to claims filed on or after January 1, 2026, for taxes due starting July 1, 2027.
Committee Categories
Military Affairs and Security
Sponsors (1)
Last Action
Subcommittee: Salmon, Townsend, and Warme. S.J. 171. (on 01/29/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.legis.iowa.gov/legislation/BillBook?ga=91&ba=SF2124 |
| BillText | https://www.legis.iowa.gov/docs/publications/LGI/91/attachments/SF2124.html |
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