Oregon lawmakers amend veterans property tax exemption rules for 2026

Oregon's House Bill 2361 is set to enhance property tax exemptions for veterans, a move that could significantly impact the financial landscape for those who have served in the military. Introduced on January 17, 2025, the bill aims to amend existing tax laws to provide greater relief for veterans with service-connected disabilities.

The key provision of HB 2361 lowers the threshold for property tax exemptions from a disability rating of 40% to just 10%. This change means that more veterans will qualify for tax relief, easing their financial burdens. Additionally, the bill allows surviving spouses of veterans who died from service-related injuries or illnesses to benefit from these exemptions, provided they remain unmarried.

Notably, the bill stipulates that the exemption amount will increase annually by 3% based on the previous year's exemption, ensuring that the relief keeps pace with inflation. Veterans must file for the exemption within six months of receiving certification of their disability from the U.S. Department of Veterans Affairs, but they can claim refunds for up to three years of back taxes if they qualify.

While the bill has garnered support for its intent to assist veterans, it has also sparked debates regarding its potential impact on local government revenues. Critics argue that the expanded exemptions could strain budgets, particularly in counties that rely heavily on property tax income. Proponents, however, emphasize the moral obligation to support those who have served the country, framing the bill as a necessary step toward honoring veterans' sacrifices.

As the bill progresses through the legislative process, its implications for Oregon's veterans and local economies will be closely monitored. If passed, the changes will take effect for property tax years beginning July 1, 2026, marking a significant shift in how the state supports its veterans.