State veteran benefits · IL
Illinois Veteran Benefits
At a 70% or higher VA rating, Illinois exempts the first $250,000 of a home's equalized assessed value under SHEVD, which zeroes out the property tax bill for most disabled veteran homeowners.
By Mario Bailey, U.S. Air Force veteran · current Air National Guard member. Data updated 2026-07-10.
What Illinois adds, benefit by benefit
Your federal VA benefits travel with you to any state. Everything below is the second stack: what Illinois itself offers, each item checked against the state's own official source on the date shown.
Standard Homestead Exemption for Veterans with Disabilities (SHEVD)
SHEVD scales with the VA rating: a service-connected disability of at least 30% but less than 50% takes $2,500 off the home's equalized assessed value, 50% to 69% takes off $5,000, and at 70% or more the first $250,000 of EAV is exempt from taxation. An unremarried surviving spouse of a veteran killed in the line of duty gets a 100% EAV reduction even if the veteran never claimed SHEVD.
Two companions are worth knowing: the Returning Veterans' Homestead Exemption cuts $5,000 of EAV for two consecutive tax years after a return from active duty, and the Specially Adapted Housing exemption can reduce assessed value by up to $100,000 for qualifying adapted homes.
SOURCE: Illinois Department of Revenue · retrieved 2026-07-10
Income tax on military retired pay
Illinois lets you subtract the federally taxed portion of retirement income from government plans, explicitly including military plans, on Line 5 of the IL-1040, so military retired pay is effectively free of Illinois income tax. VA disability compensation is not taxed by Illinois, any other state, or the IRS.
SOURCE: Illinois Department of Revenue · retrieved 2026-07-10
Illinois Veteran Grant and dependent scholarships
The Illinois Veteran Grant pays tuition and mandatory fees at all Illinois state-supported universities and community colleges for eligible Illinois veterans, and it is a state entitlement separate from federal GI Bill benefits.
Dependents have their own lane: the state runs a scholarship for dependents of veterans who are MIA, POW, died on active duty, or are 100% service-connected disabled, plus the Illinois National Guard Grant for current Guard members.
SOURCE: Illinois Department of Veterans' Affairs · retrieved 2026-07-10
State hiring preference
Qualified veterans are entitled to additional points in State of Illinois hiring sequences based on verified service, with eligibility extending to disabled veterans, Purple Heart recipients, and certain spouses and parents. The CMS Veterans Outreach Program verifies the DD-214 once and applies the preference across applications.
SOURCE: Illinois Department of Central Management Services · retrieved 2026-07-10
State veterans homes
Illinois operates five veterans homes, in Anna, Chicago, LaSalle, Manteno, and Quincy, all offering 24/7 skilled nursing, with lighter-touch domiciliary living available at Anna and Quincy. Eligibility keys off having been an Illinois resident at the time of entering service, and eligible spouses can also be admitted.
SOURCE: Illinois Department of Veterans' Affairs · retrieved 2026-07-10
Free hunting, fishing, and camping
Veterans receiving service-connected compensation of 10% or more, or a total disability pension, get Illinois hunting and fishing licenses free of charge regardless of the state they live in. Illinois disabled veterans and former POWs also camp free in Illinois DNR parks statewide.
The mechanism is a Disability Affidavit issued through IDVA, so start at a Veteran Service Office rather than the license vendor.
SOURCE: Illinois Department of Veterans' Affairs · retrieved 2026-07-10
Burial and survivor payments
Illinois pays up to $125 for setting a government headstone or marker, county Veterans Assistance Commissions must provide burial for indigent honorably discharged veterans, and the state pays survivor compensation of $3,000 for personnel killed by terrorist acts or hostile activity in the Global War on Terrorism and $1,000 to survivors of Vietnam veterans whose deaths were service-connected.
SOURCE: Illinois Department of Veterans' Affairs · retrieved 2026-07-10
Illinois is a cliff state: the distance between a 60% and a 70% rating is the distance between a $5,000 assessment trim and a property tax bill of zero on most homes. Nowhere else in this region does a single rating decision move that much money every year, forever. If your combined rating sits at 60% with an open claim or a condition that has worsened, the math on pursuing the increase is not subtle; a typical suburban Cook County bill runs five figures. Check where your conditions actually combine with the rating calculator, because VA math rounds in unintuitive ways.
Note the ceiling: the 70%+ exemption covers the first $250,000 of equalized assessed value. EAV is a fraction of market value, so the cap only bites on expensive homes, but owners of higher-end properties in Chicago’s collar counties should run their own EAV against it rather than assume a full wipe.
The second underpriced asset here is the Illinois Veteran Grant. It is a separate pot from the Post-9/11 GI Bill, which means a savvy Illinois veteran can spend IVG on their own undergraduate degree at a state school and preserve Chapter 33, with its housing allowance, for graduate school or a transfer to a child. Sequencing the two well is worth tens of thousands of dollars; burning both on the same credential is the most expensive common mistake in the state.
Money that arrives monthly stays whole too. Illinois does not tax retirement income, so a military pension lands untouched, and your disability compensation is untaxed everywhere, per is VA disability taxable.
Who benefits most overall: the 70%+ rated homeowner with college-bound kids, who can stack a zeroed tax bill, IVG, and the dependents’ scholarship. Who benefits least: the under-30% renter, for whom Illinois’s list shrinks to free licenses at 10% and hiring preference points. And one thing routinely missed: the burial layer is thinner than neighboring states because Illinois runs no state veterans cemetery system, so plan around the national cemeteries and the federal benefits in our burial and memorial guide rather than assuming a state fallback exists.
Where to apply
State benefits are administered by the state, not by VA, so the applications above run through Illinois Department of Veterans' Affairs or the specific agency named in each source link. A free VA-accredited representative or VSO in Illinois will know both stacks, the federal claim and the state paperwork, and charges nothing to help with either.