Gov. Blagojevich Reminds Veterans and Employers Hiring Veterans to File for New Tax Exemptions

New Legislation Encourages Businesses to Hire Veterans and Provides Returning and Disabled Veterans With Property Tax Relief

[January 18, 2008]  SPRINGFIELD -- As a number of tax deadlines rapidly approach, Gov. Rod R. Blagojevich has reminded the state's military heroes and employers who have hired them to file for new tax exemptions. A new law that went into effect in 2007 made more Illinois veterans and disabled people eligible for property tax relief, and another new law created the veteran's tax credit -- a state income tax credit available to employers for every qualified veteran they hire.

"We are doing everything we can in Illinois to help make sure that when our service members come home, they have access to quality jobs and receive the benefits they've rightfully earned," Blagojevich said. "These tax credits can certainly help our veterans transition more easily into civilian life."

On behalf of the governor, Illinois Department of Veterans' Affairs Director Tammy Duckworth and Department of Revenue Director Brian Hamer joined veterans and employers in Springfield on Dec. 20 to encourage eligible taxpayers to take advantage of these credits.

"I want to urge all qualified veterans, and the businesses that have hired our brave men and women, to file for these new tax exemptions before the deadline," said Duckworth. "Our veterans have served this country and have rightfully earned these benefits, while the veteran's tax credit is a way for the state to say 'thank you' to those employers who have chosen to hire our veterans."

Beginning in tax year 2007, Illinois employers can earn tax credits for hiring veterans who have recently been on active duty overseas. Employers can earn the new tax credit of 5 percent of total wages paid, up to a maximum of $600 annually, for wages paid to each veteran hired after Jan. 1, 2007. The veteran must work at least 185 days during the tax year for the employer to qualify. The credit is available for veterans who were members of the armed forces, the Reserves or the Illinois National Guard on active duty in Operation Desert Storm, Operation Enduring Freedom or Operation Iraqi Freedom. The tax credit can be claimed by employers on 2007 tax returns filed in 2008.

The 2007 homestead legislation created two new exemptions for veterans. These exemptions take effect for the 2007 tax year:

The returning veterans' homestead exemption provides qualifying veterans a one-time $5,000 reduction to their home's equalized assessed value. Upon their return home, qualifying veterans who return from active duty in an armed conflict involving the U.S. armed forces can file an application to receive this exemption.

The new disabled veterans' standard homestead exemption provides a reduction in a property's equalized assessed value to a qualifying property owned by a veteran with a service-connected disability certified by the U.S. Department of Veterans' Affairs. A $2,500 homestead exemption is available to a veteran with a service-connected disability of at least 50 percent but less than 75 percent, or a $5,000 homestead exemption is available to a veteran with a service-connected disability of at least 75 percent. A disabled veteran must file an annual application by the county's due date to continue to receive this exemption.

In addition to these two new exemptions, the state also offers the disabled veterans' homestead exemption, which provides up to a $70,000 reduction in assessed value for federally approved specially adapted housing, which will continue to be available through the 51 statewide service offices for veterans. A disabled person's or disabled veteran's property can receive only one of the following exemptions each year: the exemption for disabled veterans, the homestead exemption for disabled people or the standard homestead exemption for disabled veterans.

"Because property taxes are filed at the county level, deadlines for the homestead exemptions vary throughout the state. Veterans who qualify for these exemptions should contact their local assessor's office to inquire about the deadline and forms. Employers who have hired veterans can file for the jobs credit on their income tax and earn a credit of up to $600 for each new veteran hired annually," said Hamer, of the Illinois Department of Revenue.

Several counties' deadlines for the new homestead exemptions are listed below:

• DuPage -- Jan. 18

• Jackson -- March 1

• Kane -- Feb. 29

• Madison -- Feb. 28

• Sangamon -- Jan. 31

• St. Clair -- April 30

• Tazewell -- March 1

• Will -- March 1

• Williamson -- March 1

• Winnebago -- March 31

Several other counties, including Champaign, Lake, McHenry and Peoria, will not officially establish a due date to file for the new homestead exemptions. Cook County had not yet determined a due date as of Dec. 20.

"I served with the 25th Infantry Division in Vietnam and was wounded in a mortar attack," said Thomas D. O'Hara, a Vietnam veteran from Springfield who participated in the Dec. 20 event. "After serving our country honorably and bravely, our veterans deserve to be given the best benefits that we can give them. I am very pleased to join Director Duckworth and Director Hamer today to help promote the new homestead exemptions for veterans. This new tax exemption will save me money that I can use to continue to provide for myself and will be a great benefit for us that are on fixed incomes."

For more information about the veteran's tax credit or the new property tax exemptions for veterans, go to www.tax.illinois.gov and visit the "Taxpayer Answer Center," or call the Department of Revenue's toll-free assistance line at 1-800-732-8866.

[Text from file received from the Illinois Office of Communication and Information]