Do 100% disabled veterans get an extra Kansas income tax personal exemption?

Plain-English summary

Kansas Notice 23-06 explains a new income tax break for severely disabled veterans, created by 2022 House Bill 2239 (Section 40). The bill added a new subsection (b) to K.S.A. 79-32,121, the statute that sets Kansas personal exemptions.

Before the change, K.S.A. 79-32,121 gave a personal exemption of $2,250 per qualified individual. The new subsection (b) adds an additional $2,250 Kansas exemption -- effective for tax year 2023 and all tax years after -- for an individual who:

• has been honorably discharged from active service in any branch of the U.S. armed forces; and
• is certified by the U.S. Department of Veterans Affairs (or its successor) to be receiving disability compensation at the 100% rate, where the disability is permanent and was sustained through military action or accident, or resulted from disease contracted while in active service.

The additional exemption is claimed when the individual files a Kansas income tax return, beginning with tax year 2023. The Kansas individual income tax return, Form K-40, is being updated to reflect it.

What this means for you

Disabled veterans filing a Kansas return

• If you are honorably discharged and the VA certifies you at the 100% permanent-disability compensation rate for a service-connected disability, you may claim an extra $2,250 personal exemption starting with your tax year 2023 return.
• This is in addition to the standard $2,250 personal exemption, so a qualifying veteran effectively gets $4,500 for themselves.
• Claim it on Form K-40; keep your VA certification in case the Department asks for it.

Tax preparers

• Watch for clients who are honorably discharged veterans certified at the 100% disability-compensation rate -- they qualify for the added exemption for 2023 forward.

Common questions

Who qualifies? An honorably discharged veteran certified by the U.S. Department of Veterans Affairs to receive disability compensation at the 100% rate for a permanent, service-connected disability.

How much is it? An additional $2,250 Kansas personal exemption, on top of the regular $2,250.

When does it start? Tax year 2023 and all years after.

How do I claim it? On the Kansas individual income tax return, Form K-40.

Citations and references

• House Bill 2239 (2022), Section 40 -- added the additional exemption for disabled veterans.
• K.S.A. 79-32,121 -- Kansas personal exemptions; new subsection (b) adds a $2,250 exemption for a 100%-disability-rated honorably discharged veteran, effective for tax year 2023 and all tax years thereafter.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: Notice 23-06

Original ruling text

Policy and Research
109 SW 9th Street Phone: 785-368-8222
PO Box 3506 Fax: 785-296-1279
Topeka KS 66601-3506 www.ksrevenue.gov
Mark A. Burghart, Secretary Laura Kelly, Governor

                                       NOTICE 23-06

              ADDITIONAL PERSONAL EXEMPTION FOR DISABLED VETERANS

                                      (JULY 17, 2023)

  During the 2022 Legislative Session House Bill 2239 was passed and signed into law.

Section 40 of the Bill provides an additional personal exemption for disabled veterans.

   Prior to amendment, K.S.A. 79-32,121 provided a personal exemption of $2,250 per

qualified individual. New Section 40 of the Bill adds new subsection (b) to the statute to provide
an additional exemption for disabled veterans, effective for tax year 2023 and all tax years
thereafter. The new language states:

        (b) In addition to the exemptions provided in subsection (a), any individual who has
   been honorably discharged from active service in any branch of the armed forces of the
   United States and who is certified by the United States department of veterans affairs or its
   successor to be in receipt of disability compensation at the 100% rate, if the disability is
   permanent and was sustained through military action or accident or resulted from disease
   contracted while in such active service, such individual shall be allowed an additional
   Kansas exemption of $2,250 for tax year 2023 and all tax years thereafter.

   The additional exemption will be claimed when filing the individual's Kansas income tax

return, beginning with tax year 2023. The Kansas individual income tax return, Form K-40, will
be updated.

                                  TAXPAYER ASSISTANCE

  Additional copies of this notice, forms or publications are available from our website,

www.ksrevenue.gov. If you have questions about this Notice, please contact:

                               Taxpayer Assistance Center
                              Kansas Department of Revenue
                              Scott Office Building, 1st Floor
                                     120 SE 10th Ave
                                      P. O. Box 3506
                                 Topeka, KS 66601-3506
                                   Phone: 785-368-8222
                                    Fax: 785-291-3614