Texas is home to roughly 1.5 million veterans, making it the largest veteran population of any state in the country. Beyond the well-known advantage of no state income tax, the Lone Star State offers veterans and their families an extensive package of state-level benefits covering property taxes, education, housing, employment, healthcare, recreation, and business ownership.
This guide covers every major Texas veteran benefit currently available, with eligibility requirements, dollar amounts, and direct links to official state agencies so you can take action.
Key Takeaways
- Texas has no state income tax, meaning military retirement pay, VA disability compensation, and TSP distributions are all state tax-free.
- Veterans rated 100% disabled receive a full property tax exemption on their homestead, and partial exemptions are available for ratings as low as 10%.
- The Hazlewood Act provides up to 150 credit hours of free tuition at Texas public colleges, and unused hours can transfer to dependent children through the Legacy Act.
- The Texas Veterans Land Board offers competitive home loans up to $832,750, land loans up to $150,000, and home improvement loans for qualified veterans.
- New veteran-owned businesses can form an LLC for free and are exempt from Texas franchise tax for five years.
- Disabled veterans with a 50% or higher rating receive free hunting, fishing, and state park access through the Super Combo license.
Table of Contents
- Texas Income Tax Benefits for Veterans
- Property Tax Exemptions
- Education Benefits: The Hazlewood Act
- Housing and Land Loans (Veterans Land Board)
- Employment and Career Benefits
- Veteran-Owned Business Benefits
- Healthcare and Mental Health Services
- Texas State Veterans Homes
- Hunting, Fishing & Recreation Benefits
- Vehicle, License & Additional Benefits
- Benefits for Surviving Spouses and Dependents
- How to Access Your Texas Veteran Benefits
- Frequently Asked Questions
Texas Income Tax Benefits for Veterans
The single biggest financial advantage for veterans living in Texas is straightforward: there is no state income tax. This applies to everyone, but it is especially valuable for veterans and military retirees because it means the following income sources are completely free from state taxation:
- Military retirement pay and pensions
- VA disability compensation (which is also federally tax-free)
- Thrift Savings Plan (TSP) distributions and withdrawals
- Survivor Benefit Plan (SBP) payments
- All wages, business income, and investment income
For a military retiree collecting $3,000 per month in pension income, this means roughly $2,000 to $5,000 in annual savings compared to states that tax retirement pay. Combined with the property tax exemptions below, Texas ranks as one of the most tax-friendly states for veterans in the country. For a state-by-state comparison, see our veteran benefits by state guide.
Property Tax Exemptions
Since Texas has no state income tax, local property taxes tend to be higher than the national average. Fortunately, the state offers significant property tax relief specifically for veterans with service-connected disabilities.
100% Disabled Veterans: Full Exemption
Veterans who receive VA compensation for a 100% service-connected disability rating, or who are rated as individually unemployable (TDIU), qualify for a complete exemption from property taxes on their homestead. This benefit alone can save veterans thousands of dollars annually, depending on the county and property value. An unremarried surviving spouse can continue to receive this exemption as long as they remain in the home. If they move, the dollar amount of the exemption transfers to the new homestead.
Partially Disabled Veterans: Assessed Value Reductions
Veterans with disability ratings below 100% qualify for reductions in their property’s assessed value. The exemption amounts are based on the VA-assigned disability percentage:
- 10% to 29% disability rating: $5,000 off the assessed property value
- 30% to 49% disability rating: $7,500 off the assessed property value
- 50% to 69% disability rating: $10,000 off the assessed property value
- 70% to 99% disability rating: $12,000 off the assessed property value
Disabled veterans who are 65 or older with at least a 10% service-connected rating can receive an additional $12,000 exemption. This also applies to veterans who are totally blind in one or both eyes or have lost the use of one or more limbs.
Surviving Spouses of Service Members Killed in Action
Unremarried surviving spouses of service members who were killed in action or died in the line of duty are eligible for a 100% property tax exemption on their homestead. This benefit is a recognition of the ultimate sacrifice these families have endured.
To apply for any property tax exemption, contact your county Appraisal District or Tax Assessor-Collector and file Form 50-135, the Application for Disabled Veteran’s or Survivor’s Exemption.
Education Benefits: The Hazlewood Act
The Hazlewood Act is one of the most generous state-level education benefits in the country. It provides eligible Texas veterans with up to 150 semester credit hours of tuition exemption at any Texas public college or university. This covers tuition and most mandatory fees, though it does not include books, supplies, or living expenses.
Veteran Eligibility Requirements
To qualify for the Hazlewood Act, a veteran must meet all of the following criteria:
- Was a Texas resident when entering active duty, designated Texas as Home of Record, or entered service in Texas
- Served at least 181 days of active duty (excluding initial entry training)
- Received an honorable discharge
- Currently resides in Texas
- Has exhausted or is not eligible for federal education benefits (such as the Post-9/11 GI Bill) that exceed the Hazlewood benefit value for that semester
- Is not in default on a state-guaranteed student loan
Veterans who qualify for the Post-9/11 GI Bill (Chapter 33) must use those federal benefits first. However, if your GI Bill benefits are exhausted or if the Hazlewood exemption provides greater value for a given term, you may be eligible to use Hazlewood.
The Hazlewood Legacy Act: Transferring Hours to Children
If a veteran has unused Hazlewood hours, they can transfer them to a dependent child through the Legacy Act. Only one child may use the benefit at a time, and the child must meet these requirements:
- Be the veteran’s biological child, stepchild, adopted child, or tax-claimed dependent
- Be 25 years old or younger on the first day of the semester
- Be classified as a Texas resident by the institution
- Meet the institution’s satisfactory academic progress requirements
This is a substantial benefit. At a school like the University of Texas at Austin, where annual tuition and fees exceed $11,000 for residents, 150 credit hours of free tuition can represent over $50,000 in savings.
Spouses and Children of 100% Disabled or Deceased Veterans
Spouses and dependent children of veterans who are 100% permanently and totally disabled, or who died as a result of service, are eligible for their own 150-hour Hazlewood exemption, separate from the veteran’s hours. This is not a transfer; it is an independent benefit.
College Credit for Military Experience
Texas state law requires public universities to evaluate military training and experience for potential academic credit. This means your MOS, AFSC, or rating training may count toward degree requirements, reducing the total credit hours you need to complete.
Housing and Land Loans (Veterans Land Board)
The Texas Veterans Land Board (VLB), part of the Texas General Land Office, administers loan programs that are unique to Texas. These programs are self-funded through bonds and carry no public taxpayer funding.
Veterans Housing Assistance Program (VHAP)
The VHAP provides eligible Texas veterans and military members with home loans up to $832,750 at competitive fixed interest rates for 15, 20, 25, or 30-year terms. Veterans with a VA disability rating of 30% or higher qualify for a discounted interest rate. Key requirements include:
- The home must be the veteran’s primary residence in Texas
- Must be a single-family home, townhome, or condominium
- Must occupy the home within 60 days of closing
- Must remain in the home as primary residence for at least three years
The VLB loan can also be combined with a federal VA loan in a “two-note” arrangement, allowing veterans to obtain a blended lower interest rate on a purchase that exceeds VLB limits. This is an advantage not available in any other state.
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Veterans Land Loan Program
The VLB offers land loans up to $150,000 for tracts of one acre or more with a minimum 5% down payment and a fixed 30-year term. The current land loan interest rate is 7.25%, though rates and available discounts are subject to change. Two veteran spouses who both individually qualify may borrow up to $225,000 combined on the same tract.
Veterans Home Improvement Program (VHIP)
The VHIP provides below-market interest rate loans for home repairs and improvements to a veteran’s existing primary residence. This can cover everything from roof replacement and HVAC systems to accessibility modifications.
VLB Eligibility Requirements
To qualify for any VLB loan program, applicants must be at least 18, a Texas resident, and meet one of these service criteria:
- Active duty military member
- Texas National Guard member
- Reserve component member with 20 qualifying years for retirement
- Veteran who served at least 90 active duty days with an honorable, general, or medical discharge
- Surviving spouse of a veteran whose death was service-connected or who is listed as MIA
For the latest VLB interest rates and to get prequalified, contact the VLB call center at 800-252-8387 or visit glo.texas.gov. For details on federal VA home loans, see our VA loan guide.
Employment and Career Benefits
Texas provides several employment advantages for veterans transitioning to civilian careers.
State Hiring Preference
Wartime veterans, their spouses, and surviving spouses and orphans of those killed on active duty receive hiring preference for state agency positions. State law requires some Texas agencies to maintain at least 20% veteran employment. When qualifications between finalists are equal, the veteran must be selected.
Texas Workforce Commission (TWC) Priority Services
The Texas Workforce Commission provides priority access to employment services for veterans, including one-on-one job coaching, interview preparation, resume development, and training programs. Veterans receive intensive assistance to overcome barriers to employment and are served before non-veteran applicants at Texas Career Centers.
Occupational License Transfer for Military Spouses
Military spouses who hold a professional or occupational license in another state may be eligible to transfer that license to Texas, reducing the burden of relicensing after a PCS move. The Texas Department of Licensing and Regulation (TDLR) provides waivers and expedited processing for military personnel, veterans, and their spouses.
Veteran-Owned Business Benefits
Texas offers some of the strongest incentives in the country for veteran entrepreneurs.
Free LLC Formation and Franchise Tax Exemption
Under Senate Bill 938, new businesses that are 100% owned by honorably discharged veterans can form in Texas with the $300 filing fee waived and are exempt from the Texas franchise tax for the first five years of operation. During this five-year period, the business also does not need to file a Public Information Report. This incentive was made permanent by the Texas Legislature and applies to businesses formed on or after January 1, 2022.
To qualify, each owner must obtain a Veteran Verification Letter from the Texas Veterans Commission, complete Comptroller Form 05-904, and submit the required documents with the Secretary of State.
Veteran Entrepreneur Program (VEP)
The Texas Veterans Commission’s Veteran Entrepreneur Program provides free consultation, business plan development assistance, financing guidance, and marketing support to veteran-owned businesses. This program connects veterans with mentors and resources to help them start or grow their businesses.
Healthcare and Mental Health Services
Texas is served by major VA medical centers in Houston, San Antonio, Dallas, Temple, and El Paso, along with numerous community-based outpatient clinics throughout the state. Beyond federal VA healthcare, the state provides additional resources.
Texas Veterans Commission Veterans Mental Health Department (VMHD)
The VMHD coordinates statewide mental health support including peer-to-peer networks, suicide prevention training, and justice-involved veteran outreach. These services are free and available regardless of discharge status, which is significant since federal VA healthcare typically requires a discharge other than dishonorable.
Fund for Veterans’ Assistance (FVA)
The TVC’s Fund for Veterans’ Assistance awards grants to organizations that serve Texas veterans. Since 2009, over $359 million in grants have been awarded across more than 1,600 grants. These fund clinical counseling, housing assistance, financial aid, legal services, transportation, and other direct support for veterans and their families. Veterans in need can search for local services by county through the FVA Grant Services Directory.
Texas State Veterans Homes
Texas operates ten state veterans homes providing skilled nursing care in Amarillo, Big Spring, Bonham, El Paso, Floresville, Fort Worth, Houston, McAllen, Temple, and Tyler. These homes are open to veterans with a discharge other than dishonorable, their spouses, unremarried surviving spouses, and Gold Star parents. Costs are income-based, making them an affordable option for long-term care.
The state also maintains four veterans cemeteries, offering dignified burial services to eligible veterans and their families at no cost for the gravesite.
Hunting, Fishing & Recreation Benefits
Free Super Combo License for Disabled Veterans
Texas disabled veterans with a 50% or higher VA disability rating who receive compensation, or who have lost the use of a foot or leg, are eligible for a free Super Combo Hunting and All-Water Fishing Package. This package, normally valued at over $60, includes:
- Hunting license (big game, small game, and waterfowl)
- Fishing license for all Texas public waters
- Annual state park pass for free entry to all Texas state parks
- Migratory game bird endorsement (Federal Duck Stamp not included)
Both resident and nonresident disabled veterans qualify. Veterans must apply in person at a license retailer and provide documentation from the VA certifying their disability or present a Texas Disabled Veteran driver’s license or ID card.
Free Licenses for Active Duty Service Members
Active duty Texas resident service members are eligible for the Super Combo, All-Water Fishing, or Hunting Package free of charge. Applicants must show proof that Texas is their Home of Record or that they have been assigned to a Texas duty station for the past six months.
State Parks Passport
Veterans with a 60% or higher disability rating can obtain the State Parklands Passport, providing free entry to all Texas state parks.
Vehicle, License & Additional Benefits
Disabled Veteran License Plates
Disabled Veteran (DV) specialty plates are available for a $3 fee with the annual vehicle registration fee waived. The plate with the International Symbol of Access (ISA) provides disabled parking privileges statewide. Veterans with qualifying plates may also receive one free vehicle registration for a personally owned vehicle.
Free Driver’s License
Veterans with a 60% or higher VA disability rating who receive compensation can get a free Texas driver’s license or state ID card. Any veteran can have a “Veteran” designation added to their license or ID, which serves as convenient proof of service for discounts and benefit verification.
ETS Sponsorship Program
The Texas Veterans Commission’s ETS Sponsorship Program matches transitioning service members with trained community sponsors who help service members and their families adjust to civilian life. This goes beyond job placement to provide personal connections and community integration support.
Benefits for Surviving Spouses and Dependents
Texas extends many veteran benefits to surviving family members:
- Property tax: Unremarried surviving spouses of 100% disabled veterans keep the full property tax exemption. Spouses of those killed in action receive a full homestead exemption.
- Education: Spouses and children of 100% disabled or service-deceased veterans receive their own 150-hour Hazlewood tuition exemption. Children can also receive transferred hours through the Legacy Act.
- Housing: Surviving spouses of veterans whose death was service-connected or who are listed as MIA are eligible for VLB loan programs.
- Employment: Surviving spouses of service members killed on active duty receive state hiring preference.
- Veterans homes: Unremarried surviving spouses and Gold Star parents are eligible for Texas State Veterans Homes.
How to Access Your Texas Veteran Benefits
Getting started with Texas veteran benefits involves a few key steps:
1. Gather Your Documents
You will need your DD-214 (Member 4 copy) for most applications. If you do not have it, request it from the National Archives. You may also need your VA award letter or disability rating documentation.
2. Connect with a TVC Service Officer
The Texas Veterans Commission provides free claims assistance through service officers located across the state. They can help with both federal VA claims and state benefit applications. Find a local office at tvc.texas.gov or call 800-252-VETS (8387).
3. File for Specific Benefits
- Property tax exemptions: File Form 50-135 with your county Appraisal District
- Hazlewood Act: Register at the TVC Hazlewood portal, then apply through your school’s financial aid office
- VLB loans: Get prequalified through glo.texas.gov or call 800-252-8387
- Business formation: Start by requesting a Veteran Verification Letter from the TVC
- Hunting/fishing license: Apply in person at any Texas Parks and Wildlife license retailer
4. Use the Texas Veterans Portal
The state maintains a centralized Texas Veterans Portal where veterans can manage benefits, connect with services, and find local resources in one place.
Frequently Asked Questions
Veterans rated 100% disabled or individually unemployable receive a complete property tax exemption on their homestead, a free driver’s license, free Super Combo hunting and fishing license, the State Parklands Passport for free state park access, free vehicle registration, Disabled Veteran license plates, and eligibility for all Hazlewood education benefits for their spouse and children. Combined with Texas having no state income tax, this represents one of the most comprehensive state-level benefit packages for disabled veterans in the nation.
It depends on the veteran’s disability rating. Veterans rated 100% disabled or TDIU pay zero property tax on their homestead. Veterans with ratings from 10% to 99% receive partial reductions ranging from $5,000 to $12,000 off their property’s assessed value. Veterans without a service-connected disability pay standard property taxes but still benefit from the general homestead exemption available to all Texas homeowners.
There is currently no statewide program exempting veterans from toll road charges. While some local toll authorities may offer specific discounts, these vary by operator and are not universal. Disabled Veteran license plates provide benefits like free metered parking but do not cover toll exemptions.
You cannot use both simultaneously in the same semester if your federal education benefits cover tuition and fees. The Hazlewood Act requires veterans eligible for the Post-9/11 GI Bill (Chapter 33) to use those federal benefits first. However, once your GI Bill is exhausted, or if the Hazlewood exemption provides greater value for a particular term, you may be eligible to switch to Hazlewood for remaining coursework.
Visit any Texas Department of Public Safety (DPS) office and provide your DD-214 showing honorable discharge. The “Veteran” designation will be added to your license or state ID at no additional cost during a normal renewal or replacement. This designation serves as convenient proof of veteran status for discounts and benefit verification throughout the state.
Texas consistently ranks as one of the best states for military retirees. The combination of no state income tax (saving retirees thousands annually on pension income), strong property tax exemptions for disabled veterans, the VLB housing programs, proximity to major military installations, and access to numerous VA medical facilities makes it a top destination. The state’s relatively low cost of living compared to other large states adds to its appeal.
The VLB is a Texas-specific program that offers home, land, and home improvement loans exclusively to Texas veterans. Unlike the federal VA loan, which is available nationwide, VLB loans are funded through state bonds and are limited to Texas properties. The two can work together in a “two-note” arrangement where a VLB loan covers part of a home purchase at a lower rate while a VA loan covers the remainder, resulting in a blended lower interest rate overall.
This article is provided by USMilitary.org, an independent educational resource. We are not affiliated with the Department of Defense, the VA, or any government agency. For official Texas veteran benefit information, visit the Texas Veterans Commission or contact your local TVC service officer.