Sen. Amber Hulse, R-Hot Springs, participates in a debate in the South Dakota Senate on Jan. 29, 2026, at the Capitol in Pierre. (Photo by Joshua Haiar/South Dakota Searchlight)
PIERRE — South Dakota senators recently nixed two proposals that would have increased property tax exemptions for disabled veteran homeowners, while advancing a related bill.
Hot Springs Republican Sen. Amber Hulse said the conversation around the issue has been “vile,” and lawmakers have been too focused on putting limits on relief programs for veterans.
“It’s not enough that they sacrifice their life and their health for our country. Now they also have to be living in poverty too for us to care,” she said. “I don’t really think that that’s the right message to send.”
Under current state law, veterans who are totally and permanently disabled, and their surviving spouses, can apply for and be granted a property tax exemption on the first $200,000 of taxable value for their owner-occupied home. The recently defeated bills sought to raise that limit to $225,000 and $300,000, respectively.
County sales tax emerges as last major property tax reduction proposal standing in Legislature
Hulse and five other committee members voted Wednesday to defeat the bill that would have allowed an additional $25,000 to be exempt, and Hulse’s opposition was due to a provision that would have required veterans to also have an annual income below $65,000 for a multi-income household or below $55,000 for single-income households in order to receive the extra exemption.
The state Senate rejected the other bill last week that would have raised the exemption amount to $300,000, without adding an income threshold. Hulse voted for that bill.
Opponents of the $300,000 exemption, including U.S. Air Force veteran and Rapid City Republican Sen. Taffy Howard, were concerned that the increase would result in a “tax shift” toward other property owners.
“Our service should never be used as political cover for avoiding real property tax reform,” Howard said during a Senate debate. “South Dakotans are frustrated because the system itself needs structural reform. Carveouts and expanding exemptions do not fix the system. They simply rearrange who pays.”
Other help for disabled veterans
The Senate Taxation Committee approved a bill Wednesday that would refund qualified disabled veterans up to four years’ worth of property tax exemptions if they missed the application deadline due to a delayed decision about a pending claim for a permanent and total disability rating from the U.S. Department of Veterans Affairs.
Gov. Larry Rhoden signed a similar bill into law earlier this month that alters an existing exemption program for veterans who’ve lost both legs or the use of both legs. The new law lets those veterans or their surviving, unmarried spouses apply for four years’ worth of refunds if they missed prior application deadlines for the program, or missed deadlines to have their home classified as owner-occupied.
The bills are among dozens introduced this winter by lawmakers seeking to lower or slow the increase in homeowner property taxes. One of the leading candidates for major reform is a governor-backed bill that would let counties impose a half-percent sales tax and use the proceeds for homeowner property tax credits.
