California veterans rated 100% disabled can exempt half of a home’s value, up to $1 million of value, from property tax starting with the Jan. 1, 2027 lien date, under SB 296, which Gov. Gavin Newsom signed Sept. 28. The Board of Equalization’s analysis of the bill describes an exemption of a fixed slice of assessed value, not a blanket waiver of a whole home’s tax. The $83,474 household-income figure that gets quoted alongside the bill belongs to a different, older tier.
What does the new SB 296 exemption actually cover?
The bill, authored by state Sen. Bob Archuleta, exempts 50% of the part of a property’s full value that does not exceed $1,000,000, according to the Board of Equalization’s Aug. 21 analysis. Half of the first $1 million works out to a ceiling of $500,000 of exempt value. A home worth more than $1 million gets no additional exemption on the value above that line.
The property must be owned by, and serve as the principal residence of, the veteran, the veteran’s spouse, or both jointly, and the veteran must be 100% disabled. The analysis says the new exemption applies “in lieu of” the existing exemption in Revenue and Taxation Code section 205.5, so it replaces that benefit rather than stacking on top of it.
It applies to lien dates on or after Jan. 1, 2027, but before Jan. 1, 2032. That covers five annual lien dates, 2027 through 2031, and the bill requires the board to report data to the Legislature each June 1 from 2027 through 2031.
Where does the $83,474 income figure belong?
The number belongs to the exemption California already has. Under current law, the basic disabled veterans’ exemption is $100,000 in assessed value, adjusted for inflation, which the board puts at $185,889 for the 2027 lien date. A larger low-income exemption starts at $150,000, adjusted the same way, and reaches $278,836 for 2027 for claimants with household income below $83,474.
An earlier version of the bill, amended July 1, would have paid a 100% exemption to veterans and unmarried surviving spouses with household income up to $83,474. The board’s summary of the Aug. 13 amendment, the version that cleared the Assembly, describes only the 50% exemption. That is why a flat claim that a veteran under the income limit can exempt a whole home does not match the bill as signed.
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Who qualifies, and what must go to the assessor?
A veteran must be blind in both eyes, have lost the use of two or more limbs, or be totally disabled from an injury or disease incurred in military service. For blindness or limb loss, the U.S. Department of Veterans Affairs or military disability rating must be 100%. Unmarried surviving spouses may qualify under certain conditions, including that the veteran was a California resident on Jan. 1 of the year of death.
A claimant has to give the county assessor military documentation of the veteran’s disability rating. The analysis states no filing deadline, and it assumes assessors will keep sending the annual notice to existing claimants that section 278 of the tax code requires. Questions about how the change applies to an existing claim go to the county assessor.
The analysis does not explain how the old $185,889 and $278,836 amounts would be used alongside the new structure. A household that currently gets the low-income exemption cannot tell from the board’s letter whether half of the first $1 million is larger or smaller than what it already receives; that comparison depends on the home’s assessed value, and the county assessor is the office that holds it.
How much tax does half of $1 million of value save?
For a home assessed at $600,000, the new exemption removes $300,000 of value from the tax bill, compared with $278,836 under the current low-income tier for 2027 and $185,889 under the basic tier. For a home assessed at $300,000, it removes $150,000, which is less than either existing amount. The exemption grows with the home’s value until it caps at $500,000, so it favors higher-valued homes.
Those figures are arithmetic on the board’s published amounts, not a tax estimate. The actual bill depends on the local tax rate and any voter-approved charges, which vary by county. The board’s revenue estimate for the bill is about $197 million a year in local revenue loss, roughly $31 million more than the current exemptions, though the analysis modeled a 100% scenario for lower-income households that the Aug. 13 text does not include.
What did the governor and the sponsor say?
The bill was chaptered as Chapter 727 of the Statutes of 2026 on Sept. 28, after the Senate concurred in the Assembly amendments 39-0 and the Assembly passed it 78-0. Newsom signed it as part of a five-bill veterans package. “Veterans served us honorably; now it’s our honor to serve them,” the governor said, according to the Daily Journal’s report on the signing, which describes SB 296 as exempting 50% of a home’s value up to $1 million for veterans who are 100% disabled.
The open question for current claimants is the choice between the exemption they have and the one the bill creates. Veterans with a 100% rating who own a home assessed above about $558,000 would see the larger exemption under the new formula, while those with lower-valued homes could do better under the existing low-income tier. The county assessor can run both numbers against the parcel’s assessed value before the Jan. 1, 2027 lien date.
Is the property tax break the only VA benefit still unchecked?
A county exemption lowers a tax bill, but it does nothing about the federal side of a veteran’s money. Wartime veterans and widows with limited income can leave VA pension and Aid & Attendance unclaimed while the property tax paperwork gets all the attention.
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This article was produced with AI assistance and edited for accuracy against the sources linked above.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
