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D.C. committee weighs extending disabled-veteran homestead deduction to surviving spouses
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Summary
The Committee on Business and Economic Development heard testimony March 19, 2025, on Bill B26-10, the Spousal Homestead Exemption Amendment Act of 2025, which would allow a surviving spouse or domestic partner of a disabled veteran to claim the District's disabled-veteran homestead deduction after the veteran's death.
The Committee on Business and Economic Development held a hearing March 19, 2025 on Bill B26-10, the Spousal Homestead Exemption Amendment Act of 2025, which would allow a surviving spouse or domestic partner of a veteran eligible for the District's disabled-veteran homestead deduction to claim that exemption after the veteran's death.
Supporters and witnesses told the committee the change would help families remain in their homes after a veteran's death and safeguard low- and moderate-income households from sudden property-tax increases. City counsel and OCFO staff raised questions about draft language and implementation timing.
Bonnie Roberts Burke, a member of the Public Policy Committee of the D.C. Association of Realtors (DCAR), testified in favor of the bill, calling it "a modest expansion of the homestead exemption for veterans" and saying the change "will make an oversized difference for hundreds of district families potentially at risk of losing their homes." DCAR's testimony said the original deduction has had a limited fiscal impact and urged the council to consider the change even amid tight budgetary conditions.
Assistant General Counsel Basil Fiscina of the Office of the Chief Financial Officer (OCFO) said the bill "contains a number of ambiguities" and provided a suggested revised draft to improve clarity and administrability. He outlined the current statutory framework: effective Oct. 1, 2022, property owned and occupied by a veteran classified by the U.S. Department of Veterans Affairs as totally and permanently disabled (or at the 100% VA disability rating due to unemployability) may get a $445,000 reduction in assessed value, subject to owner-occupancy, ownership percentage, domicile and a household income limit (which witnesses cited as approximately $159,750 for tax year 2025). OCFO counsel said about 35 properties currently receive the deduction in D.C.
Committee members asked for details about potential retroactivity and administrative timing. OCFO counsel suggested that, for practical administration, it would be preferable to phase any change for tax year 2026 to allow time to prepare forms and processes. Fiscina also noted screening language to ensure the surviving spouse or partner benefits only when the veteran either was receiving the deduction at death or would have been eligible had they applied.
No vote was taken at the hearing. Committee members said they would request any additional fiscal analysis as part of the bill's progression and expect to work with OCFO to tighten language addressing eligibility, administration and the effective date so the policy could be implemented without creating unanticipated fiscal or administrative burdens.
