VA HB697

Creates a nonrefundable income tax credit for surviving spouses of veterans who had 100% service-connected permanent and total disability, covering real property taxes paid on their primary residence

Applies to surviving spouses who would have qualified for the existing property tax exemption but whose veteran spouse died before January 1, 2011 (when the exemption program began)

Credit equals the full amount of real property taxes paid on the qualifying residence, with unused credits carrying forward for up to five years

Program runs from January 1, 2026 through January 1, 2031, with a $5 million annual cap allocated on a first-come, first-served basis

Requires the taxpayer to have owned the residence for at least 30 days during the tax year and used it as their primary residence during that ownership period