Tax Court Declines to Extend Recent Expansion of Veteran’s Exemption

by: Matthew Erickson
30 Sep 2022

Disabled Veteran’s Tax Exemption

On September 12, 2022, the Tax Court of New Jersey rendered a six (6) page unpublished opinion in Michael Hutchings v. Borough of Lawnside that addressed whether a Lawnside resident qualified for the “disabled veteran’s exemption” from his local property taxes.  The opinion, written by the Hon. Kathi F. Fiamingo, J.T.C., provides valuable guidance into whether the recent update to the disabled veteran’s exemption law applies retroactively.

The plaintiff, who represented himself in this matter, is the owner of property in Lawnside, NJ, where he currently resides.  The plaintiff had twice served in the United States Armed Forces, though the opinion does not make his branch of service known.  In early 2009, the plaintiff was determined to be 100% disabled by the United States Department of Veterans Affairs.  The plaintiff subsequently applied for the disabled veteran’s property tax exemption in 2015 and 2018.

While the court notes that the 2015 exemption was denied, it was not timely appealed and therefore the court lacked jurisdiction to evaluate the denial of the exemption.  For the 2018 year, the court noted that the claim was denied and later appealed to both the Camden County Board of Taxation and the Tax Court of New Jersey.

The court approached this matter by first noting that the matter did not have any disputes of material fact and therefore was ripe for summary judgment.  Consequently, the court began its legal analysis, looking directly at the requirements necessary for the disabled veteran’s tax exemption.  As with all tax exemption statutes in New Jersey, the court strictly construes their terms and does not take the requirements lightly.

The disabled veteran’s tax exemption, established by statute in N.J.S.A. 54:4-3.30(a), provides for a full exemption from property taxation if the owner of the property has: 1) been a citizen or resident of the state; 2) has been honorably discharged or released under honorable circumstances for the Armed Forces of the United States; and 3) has been found to be 100% disabled by the Department of Veteran’s Affairs.  Under those circumstances, the plaintiff would likely qualify for this exemption.

Unfortunately for the plaintiff, the above statute previously required the service of the veteran in a “time of war” for the time periods that he was contesting the denial of his exemption.  The statute contained the “time of war” provision until late 2020 when that part of the statute was removed via Constitutional amendment. That left the court with the question of which requirements to apply to the plaintiff in this matter.

The court went into the history of the statute and declined to apply the change retroactively.  It found the prior language, requiring service in a time of war, was controlling and started applying its analysis to that prior language.  There, the court noted that the statute contained an exclusive list of conflicts which qualified for wartime service.  Finding that the plaintiff did not serve in any of those conflicts, the court ruled that the plaintiff was not entitled to the disabled veteran’s exemption for the periods claimed.

This case shows some of the special factors that need to be considered for a New Jersey disabled veteran to obtain a property tax exemption.  If you have questions about whether you may qualify for a disabled veteran’s tax exemption from property taxes, competent legal counsel can be instrumental to ensure that you have answers to those questions.  From the initial intake to final resolution, an experienced tax appeal attorney can help you navigate through the specifics of each individual case.  If you have any questions concerning your property tax assessment, contact McKirdy, Riskin, Olson & DellaPelle, P.C. to speak with an experienced attorney. To view the full opinion, click here.