The state of North Carolina offers many veteran benefits for service members and Veterans that have served in the Armed Forces of the United States of America. These benefits include income and property tax exemptions, financial exemptions, education and training programs, hunting and fishing licenses, vehicle registrations, and assistance with employment. Your residency, military career, and disability status may result in certain differences in what benefits you may be eligible for. The following are benefits for the state of North Carolina.
Income Taxes: If an individual had five years of creditable service as of August 12, 1989, all military retired pay is exempt from taxes. Effective for taxable years beginning on or after January 1, 2014, there are no deductions available for distributions from private retirement plans or government retirement plans that do not qualify as tax-exempt Bailey benefits.
Property Tax: Any Veteran discharged honorably and have a 100% permanently and totally disability rating are eligible for up to a $45,000 deduction in the assessed value of their home. Any surviving spouse of a Veteran is also eligible if they are drawing DIC from the VA.
State Taxes on U.S. Department of Veterans Affairs Military Disability Retired Pay: Military Disability Retirement Pay received as a pension, annuity or similar allowance for personal injury or sickness resulting from active service in the Armed Forces should not be included in taxable income if any of the following conditions apply:
You were entitled to receive a disability payment before September 25, 1975
You were a member of the military (active or reserves) or were under a binding written commitment to become a member on September 24, 1975
You receive disability payments for a combat-related injury (injury caused by armed conflict, extra-hazardous service, training exercises, or instrumentality of war).
Military Survivor Benefit Plan (SBP)/ Reserve Component Survivor Benefit Plan (RCSBP)/ Retired Serviceman’s Family Protection Plan (RSFPP) North Carolina State Tax Benefits: Dividends and all other proceeds except interest on dividends from G.I. insurance policies are exempt from income taxation.
State Taxes on VA Dependency and Indemnity Compensation (DIC): DIC is a tax-free monetary benefit paid to eligible survivors of service members who died in the line of duty or eligible survivors of Veterans whose death resulted from a service-related injury or disease.
Military Spouses Residency Relief Act: North Carolina does not tax the income earned for services performed in North Carolina by a spouse of a Service member stationed in North Carolina if:
The service member is present in NC solely in compliance with military orders
The spouse is in NC solely to be with the Service member
The spouse is domiciled in the same state as the Service member
Sales Tax:
Statewide: 4.75%
Counties: up to 2.75% additional
Average combined: 6.92%
Wildlife Resource Commission Disabled Veteran Hunting and Fishing Benefits: Discounted hunting and fishing licenses for eligible disabled Veterans.
Resident Rates for Nonresident Service Members & Dependents: Active duty members stationed in NC, their spouses, and dependents under 18 qualify for resident rates. Active duty members stationed outside NC are also considered NC residents for short-term/annual licenses.
National Guard Tuition Assistance Program (NCTAP): Provides tuition assistance for active NC National Guard members. Funding is subject to availability.
In-State Tuition for Non-Resident Service Members: Active-duty members stationed in NC (and their dependents) qualify for in-state tuition. If reassigned, they retain in-state tuition as long as they remain continuously enrolled.
Scholarship for Children of Wartime Veterans: Provides up to eight semesters of tuition at NC schools for eligible children of deceased, disabled, combat, or POW/MIA Veterans. Applicants must be under 25, residents of NC, and apply by February 14.
Interstate Compact on Educational Opportunity for Military Children: Removes barriers for military children transferring schools, ensuring smooth enrollment, placement, participation in activities, and on-time graduation.
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Eligibility for admission
Veterans must have served in the Armed Forces (deployment necessary)
Discharged other than dishonorable
Resident of NC for at least 24 months before applying
Must be referred by a licensed physician
Must need skilled nursing care
Must be disabled by reason of age, disease, or other reasons determined through a physical exam
Veterans Preference: 5 points added to exam scores for honorably discharged Veterans; 10 points for service-connected disabled Veterans.
State Employee Leave for Military Duty: Up to 120 hours per fiscal year for National Guard and Army Reserve members.
Differential Pay for Military Duty: The State may pay the difference between military basic pay and state salary when military pay is less.
Uniformed Services Employment and Reemployment Rights Act (USERRA): Protects job rights and benefits for Reserve and National Guard members.
Document burial preferences and keep records safe.
National Cemeteries in North Carolina:
Regional Benefits Office
VA Medical Centers
Important Information
For first-time VA benefits applications, submit a copy of DD 214 (discharge paperwork). Honorable and general discharges qualify for most VA benefits. Keep these documents and medical records safe and accessible.
Eligibility is based on discharge under conditions other than dishonorable. Active service means full-time service in the Army, Navy, Air Force, Marine Corps, Coast Guard, or as a commissioned officer of the Public Health Service, Environmental Services Administration, or NOAA.
Dishonorable discharges due to general courts-martial may bar VA benefits. Veterans in prison or parolees may be eligible for certain VA benefits. Regional offices can clarify eligibility.
State veteran benefit programs and eligibility requirements change regularly due to federal and state government updates. This information serves as general guidance. Contact us for current program details and personalized benefits assistance.