The Chicago Veteran's Guide to Property Tax Savings

Maximize Your VA Benefits in Cook County

Chicago is one of the most veteran-friendly real estate markets in the country. If you've served, you might be sitting on tax savings that could knock thousands off your property tax bill - or eliminate it entirely. Here's what you need to know for 2026 and beyond.

The Big One: Homestead Exemption for Veterans with Disabilities

This is your main benefit if you have a service-connected disability. It reduces the Equalized Assessed Value (EAV) of your primary residence, which directly lowers what you pay in property taxes.

Here's how it breaks down:

70% to 100% disability rating: You pay zero property taxes on the first $250,000 of EAV. In neighborhoods like Beverly or Morgan Park, this wipes out the tax bill for most single-family homes and two-flats. We're talking about properties worth around $820,000 in market value.

50% to 69% disability rating: You get a $5,000 reduction in EAV.

30% to 49% disability rating: You get a $2,500 reduction in EAV.

That 100% exemption is massive. If you're rated at 70% or higher, you could be saving $8,000 to $12,000 per year depending on your property's assessed value.

Just Got Back? There's an Exemption for That

If you recently returned from active duty in an armed conflict, you qualify for a $5,000 EAV reduction. You get this benefit for two consecutive tax years: the year you returned and the one after.

It's not as dramatic as the disability exemption, but it's still real money… usually $500 to $800 in annual savings. And you don't need to jump through hoops to get it.

World War II Veterans Get Special Treatment

Here's something that passed in 2024 and deserves more attention: all WWII veterans living in Cook County now qualify for 100% property tax exemption, regardless of disability rating. This benefit also extends to surviving spouses who haven't remarried.

If this applies to you or someone you know, make sure they're taking advantage of it.

What Happens to Your Spouse?

Your tax-free status can be transferred. If you were eligible for the 100% exemption when you passed away, your un-remarried surviving spouse continues to receive it. They can even move to a new primary residence and keep the benefit.

This is a big deal for financial planning. It means your family won't get hit with a sudden tax increase during an already difficult time.

A Few Things Worth Knowing

Multi-family properties: You can apply these exemptions to two-to-four unit buildings as long as you live in one of the units. The exemption typically gets prorated based on how many units are rental versus owner-occupied, but you still come out ahead.

Stacking benefits: If your disability rating is between 10% and 69%, you can combine the general homeowner exemption with your veteran exemption. That gives you extra EAV reductions on top of what you'd get from either one alone.

Automatic renewal (sometimes): If you're rated 100% "Permanent and Total" (P&T), your exemption renews automatically in Cook County. You don't have to do anything each year.

Manual renewal (most people): If you're not rated P&T, you need to re-file annually. This means submitting paperwork that certifies your disability rating through a Veteran Benefit Verification Letter.

Getting your verification letter: Head to VA.gov and log in. Your Veteran Benefit Verification Letter will show your current disability percentage. Download it and keep a copy as you'll need it for your exemption application.

Why This Matters for Real Estate Decisions

These exemptions change the math on what you can afford. A $400,000 home that would normally cost you $10,000 per year in property taxes might cost you nothing if you're rated at 70% or higher. That's like getting a $150,000 discount on the purchase price when you account for the tax savings over time.

It also makes multi-family investing more attractive. You could buy a two-flat, live in one unit, rent out the other, and still get the full tax exemption on your portion. The rental income covers your mortgage while the exemption eliminates your property tax burden.

Ready to Make Your Move?

At Dorazio Real Estate, we work with veterans all the time. Whether you're looking for your first home or a multi-family property to build wealth, we make sure you're getting every benefit you've earned.

Don't leave money on the table. These exemptions exist because you served. Use them.

Want to save this guide for later? Download the complete PDF with all exemption details, eligibility requirements, and contact information you can reference anytime.