HARRISBURG – Sen. Chris Gebhard (R-48) introduced legislation today to expand eligibility for Pennsylvania’s real estate tax exemption for 100% disabled veterans by excluding contributions made to PA ABLE accounts and clarifying that any earnings and qualified distributions from PA ABLE accounts are not subject to income calculations used to determine eligibility for the exemption.
“PA ABLE is a great program for those with disabilities, including our veterans,” Gebhard said. “Unfortunately, a disabled veteran taking advantage of this program could inadvertently jeopardize their real estate tax exemption. This legislation ensures every veteran with a service-connected disability can take advantage of PA ABLE accounts, and by excluding PA ABLE accounts, we can offer even greater benefit to those Pennsylvanians that sacrificed so much for our freedom.”
“As a veteran myself, I understand the sacrifices disabled veterans have made to defend our great nation, and they deserve every possible benefit the commonwealth can provide to ensure they can remain financially secure and in their homes,” said Treasurer Stacy Garrity. “PA ABLE is a life-changing program that increases independence and opportunity, and I commend Sen. Gebhard for his work to ensure our disabled veterans’ property tax exemptions are protected when they save with PA ABLE.”
Senate Bill 1361 addresses an unintended conflict with the Disabled Veterans’ Real Estate Tax Exemption, which was enacted before the PA ABLE program existed. PA ABLE accounts are tax-advantaged savings plans designed specifically for individuals with disabilities to cover qualified expenses like housing, transportation, healthcare and education.
Disabled Veterans’ Real Estate Tax Exemption program eligibility currently hinges on a means test that compares an applicant’s income against household expenses. Because current law is silent on how the Department of Military and Veterans Affairs should treat PA ABLE accounts, disabled veterans who save through these accounts risk having those savings counted against them when applying for the exemption.
Gebhard’s bill would close that gap by explicitly excluding PA ABLE account contributions, earnings and qualified distributions from the income calculation, and by making clear that contributions to a PA ABLE account shall be deducted from a veteran’s gross income before comparison to the eligibility threshold.
Senate Bill 1361 is now under consideration by the Senate Finance Committee.