New Hampshire Veteran Benefits: What the Statutes Actually Say
New Hampshire's veteran benefits, cited to the RSA behind each one. The disabled veteran benefit is a $700 credit, not an exemption, against the highest property tax rate in this group.
New Hampshire is the clearest example of why "no income tax" is not the whole story. The state takes nothing from your military retirement, and then hands a 100 percent permanently and totally disabled veteran a $700 credit against a property tax bill that, at a 1.66 percent effective rate, is one of the heaviest in the country.
Every figure below is cited to the RSA or the state agency that administers it.
Military retirement pay: not taxed, and now fully so
New Hampshire has never taxed wages or pensions. Its only individual income tax was the Interest and Dividends Tax, and that is repealed for tax periods beginning after 31 December 2024. See NH Department of Revenue Administration.
So as of tax year 2025 onward, New Hampshire takes nothing from military retired pay, VA disability compensation, Social Security, wages, TSP withdrawals, or investment income. That last one is new. If you read an older guide warning you about New Hampshire's 5 percent tax on interest and dividends, that guide is out of date.
Property tax: a credit, not an exemption, and the distinction costs you
New Hampshire does not exempt disabled veterans from property tax. It offers credits, which are flat dollar reductions of the bill rather than reductions of assessed value. Three tiers, and they are frequently conflated.
1. Standard veteran credit, RSA 72:28. A $50 credit for any qualifying veteran. A town may vote to adopt up to $750.
2. Service-connected total disability credit, RSA 72:35. A $700 credit for a veteran rated 100 percent permanently and totally disabled from service. A town may vote to adopt anywhere from $701 up to $5,000.
3. Specially adapted homestead exemption, RSA 72:36-a. This is the only full exemption from all taxation on the homestead, and it is narrow: it applies only to permanently and totally disabled veterans who are double amputees, paraplegic, or blind, and who own a specially adapted homestead acquired with VA assistance.
So the sequence matters. Most 100 percent P&T veterans land in tier 2 and receive $700, unless their town has voted higher. Only the specific disabilities in tier 3 get a full exemption.
Why the rate makes this worse
New Hampshire's statewide effective property tax rate is roughly 1.66 percent, the highest among the ten states in this series. On a $400,000 home that is about $6,640 a year. A $700 credit covers about 10 percent of it.
This is the single most counterintuitive result in state veteran benefits. A 100 percent disabled veteran is often better off in a state that taxes income but fully exempts the home. New Hampshire is one of the 29 jurisdictions that do not fully exempt property tax at 100 percent permanent and total.
The town vote is the variable worth researching. The spread between the statutory $700 floor and the $5,000 ceiling is real money, it is decided municipality by municipality, and it can differ between two towns twenty minutes apart. Before you choose a town in New Hampshire, call the assessor and ask which credit amount they have adopted. Nobody will volunteer it.
Surviving spouses
Two separate provisions, both via NH DRA:
- Killed in action. The surviving spouse of a service member killed while on active duty may receive a property tax credit of between $700 and $2,000, administered by the municipal tax collector.
- Specially adapted homestead. The surviving spouse of a permanently and totally disabled veteran who was blind, paraplegic or a double amputee from service, and who owned a VA-assisted specially adapted homestead, is exempt from all property taxation on that homestead.
State employment preference
Per NH Office of Veterans Services:
- 5 points on exams and interviews for state jobs, for veterans with an honorable discharge
- 10 points total for veterans with a VA disability rating of 10 percent or more
- Spouses and unremarried surviving spouses may also qualify
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Tax breaks, education benefits, and hiring preferences across all 50 states.
New Hampshire Employment Security also gives veterans and eligible spouses priority of service for workforce programs and priority in federally or state-funded job training. See NH veterans employment.
Hunting and fishing
Free lifetime license for honorably discharged resident veterans with a total and permanent service-connected rating. A one-time $10 administrative fee applies.
Half-price lifetime license for veterans rated 80 to 99 percent for at least two years. That two-year holding period is the catch, and this tier is almost never mentioned. See NH Fish and Game.
Vehicles and licenses
Veteran indicator on a driver license or ID at no additional cost, for honorably discharged veterans.
Disabled Veteran plate. Veterans who are permanently and totally service-connected disabled qualify for one free plate and are exempt from the license fee. Plates carrying the accessibility symbol allow free municipal parking, which is a quietly useful benefit in Portsmouth or Concord.
Both via NH DMV.
The state veterans home
The New Hampshire Veterans Home in Tilton is a 250-bed state long-term skilled nursing facility, including dementia and hospice care.
Eligibility: honorably discharged, and either a New Hampshire resident for at least one year before applying or listed New Hampshire as home of record at discharge. No combat service or service-connected disability required.
The home-of-record alternative is worth knowing. If you enlisted from New Hampshire and have lived elsewhere since, you may qualify without re-establishing a year of residency.
What the common summaries get wrong
| Claim you will see | What is actually true |
|---|---|
| "New Hampshire taxes interest and dividends" | Repealed for tax periods beginning after 31 Dec 2024. |
| "100% disabled veterans are exempt from property tax" | No. A $700 credit under RSA 72:35, unless the town adopted more. |
| "New Hampshire has a full exemption for disabled veterans" | Only under RSA 72:36-a: double amputee, paraplegic or blind, with a VA-assisted adapted homestead. |
| "The credit is the same everywhere in the state" | No. Towns vote, from $700 up to $5,000. Ask before you buy. |
| "No income tax makes it the best state for disabled veterans" | At a 1.66% effective property tax rate, often the opposite. |
| "Free hunting and fishing at 50%" | No. Total and permanent for free; 80-99% held two years for half price. |
| "The veterans home needs a service-connected disability" | No. Neither combat service nor a rating is required. |
If you are considering New Hampshire
For a military retiree with no disability rating and a modest house, New Hampshire is excellent: nothing is taxed on the income side at all, now including investment income. For a 100 percent disabled veteran buying a typical home, the property tax bill will likely exceed what you would pay in a state that taxes your pension but exempts your house.
Do two things before deciding: run the comparison on both taxes at once, and call the assessor in the specific town you are considering to ask what credit they have adopted under RSA 72:35.
Compare New Hampshire against any other state with our State Value Calculator, or see the full picture on the New Hampshire benefits page.
Sources
- NH Department of Revenue Administration, Interest and Dividends Tax
- RSA 72:28, standard veterans tax credit
- RSA 72:35, service-connected total disability credit
- NH DRA, exemptions and veterans tax credits
- RSA 72:36-a, specially adapted homestead exemption
- NH Office of Veterans Services, state benefits
- NH veterans employment and priority of service
- NH Fish and Game, disabled veterans license
- NH DMV, veterans plates and decals
Figures verified against New Hampshire RSAs and state agency pages on 5 November 2026. Credit amounts above the statutory minimum are adopted by each municipality, so confirm the figure with your town or city assessor. This is general information, not tax or legal advice.
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