Michigan Veteran Tax Exemptions 2026

Michigan provides a full property tax exemption for veterans with a total disability rating, covering the primary residence without a dollar cap. The state also offers an income tax exemption for military retirement income, so the benefit runs across two major tax categories. This page explains how both exemptions work and guides you through the application process.

Does Michigan tax VA disability income?

No. Michigan does not tax VA disability compensation. The state treats it the same way the federal government does, which means it is left off your taxable income entirely. Whether you are rated 10 percent or 100 percent, your VA disability pay is not taxed by Michigan.

Michigan property tax exemption for disabled veterans

Full exemption at 100% P&T. 100% P&T disabled vets are fully exempt from property tax.

The property tax exemption here is a full one, not a tiered reduction, so reaching the qualifying rating means your home is off the tax rolls entirely while you remain eligible.

What rating do you need in Michigan?

The size of your break depends on your combined VA rating. In Michigan, the full break is reserved for veterans at the top rating, usually 100 percent or 100 percent Permanent and Total. Lower ratings may still qualify for a smaller break, so it is worth checking with your county even if you are not yet at 100 percent. Not sure what your combined rating works out to? Run it through our VA disability calculator first, and if you are aiming for the top tier, check whether you qualify for Permanent and Total status.

How to claim your Michigan exemption

1. Confirm your current combined rating and whether it is Permanent and Total. Your VA award letter shows both.
2. Gather your DD-214 and your VA disability award letter. Most Michigan offices ask for both.
3. Contact your county tax assessor for the property tax exemption, and the your state tax agency or Department of Veterans Affairs for the income side.
4. File before your county deadline. Many counties require you to apply once, then renew only if your rating changes.

Always confirm the current figures and deadlines with your county assessor and the Michigan Department of Veterans Affairs before you rely on them. Rules and dollar amounts change year to year.