Knowing the Washington, D.C. tax laws will go a long way in helping you have a smooth tax season. Understanding who must file a Washington tax return is essential because not filing one if you are required to do so can result in stiff penalties.
Who Must File Washington, D.C. Income Taxes?
If you are a resident of Washington, D.C. and were required to file a federal return with the IRS, you must file an income tax return in Washington. A resident is an individual who was domiciled in Washington, D.C. anytime during a tax year.
An individual who has maintained an abode for a total of 183 days or more must file a Washington tax return. This includes those individuals who have a permanent home outside the District of Columbia.
If you are a part-year resident, you must file a Washington, D.C. tax return. A part-year resident is an individual who has moved into or out of Washington with the intent to either abandon or establish their domicile in Washington, D.C.
Those who want to receive refundable credits must file a Washington income tax return.
A member of the U.S. armed forces with a home of record as the District of Columbia for part of or a full taxable year must file a Washington tax return.
What Are the Forms to Use?
To file an income tax return, use Form D-40. This is applicable to all filers.
You must use additional forms to receive refundable credits. Use Schedule H for the Homeowner and Renter Property Tax Credit and Schedule ELC for the Keep Child Care Affordable Tax Credit.
What Is the Tax Rate in Washington, D.C.?
Washington, D.C. has a progressive individual tax rate structure:
- 4 percent of taxable income not over $10,000
- 6 percent plus $400 of excess taxable income over $10,000 but not over $40,000
- 6.5 percent plus $2,200 of excess taxable income over $40,000 but not over $60,000
- 8.5 percent plus $3,500 of excess taxable income over $60,000 but not over $250,000
- 9.25 percent plus $19,650 of excess taxable income over $250,000 but not over $500,000
- 9.75 percent plus $42,775 of excess taxable income over $500,000 but not over $1,000,000
- 10.75 percent plus $91,525 of excess taxable income over $1,000,000
Make sure you have your W-2 form or a 1099 form to determine which tax bracket applies to you.
Unemployment benefits are subject to Washington, D.C. income taxes.
What Are the Filing Deadline and Extension Process?
The due date to file and pay taxes is April 18, 2022.
A taxpayer may request an extension to file their income tax returns on October 17, 2022. But all taxes must still be paid on April 18, or you risk penalties. You can request an extension on MyTax DC website.
Those members of the U.S. Armed Forces serving in designated combat zones, may have an extension up to an additional six months. This not only applies to filing but also to paying taxes that are due.
If you are owed a refund, you have three years from the April 18, 2022 due date to file an individual income tax return.
What Are the Penalties for Late Filing or Underpayment of Taxes?
The District of Columbia late filing penalty is a charge of 5 percent of your total unpaid taxes per month or part of the month. The maximum penalty for a late filing is 25 percent of your unpaid or late paid taxes. The minimum penalty is $5.
As a Washington, D.C. taxpayer, you will be charged a 5 percent underpayment penalty if your entire tax liability isn’t paid with the return. An additional penalty of 25 percent is levied on any unreported taxable income that’s more than 25 percent of the taxable income shown on your return.
The total taxes must be paid within 90 days, or the District of Columbia Office of Tax and Revenue will add a collection fee to taxes over $200 (including penalties and interest). This fee is 10 percent of the underpaid taxes plus interest and penalties. The interest rate on unpaid taxes is 10 percent compounded daily.
If you are unable to pay your taxes, you can request an installment plan from the Office of Tax and Revenue (OTR). When making installment payments, current taxes must be paid as well. If this isn’t done, then the OTR may collect taxes due by your seizing wages or bank accounts.
All OTR payment agreements are subject to re-evaluation.
Where Do I Mail/E-file My Washington, D.C. Return?
If you expect a refund, send your Washington returns to: Office of Tax Revenue, P.O. Box 96145 Washington, D.C. 20090-6145. If you are including a payment, send your return to: Office of Tax Revenue, P.O. Box 96169 Washington, D.C. 20090-6169.
You can electronically file your Washington, D.C. individual tax return when you e-file your federal tax return. Some eligible taxpayers can also e-file on DC.gov website.
How Do I Pay Taxes Due?
You can pay taxes through the mail. Use the D-40P payment voucher. Payment can be made with a check or money order.
You can also pay your taxes online with an electronic check (ACH Debit) by logging into the DC.gov website. Credit cards are also accepted. The Office of Tax Revenue honors Visa, MasterCard, Discover and American Express. There is a 2.5 percent convenience fee per transaction up to two transactions a month.
If you need assistance, call the e-Services Unit at 202-759-1946 or email email@example.com .
Where Can I Check My Washington, D.C. Refund Status?
Go to the OTR MyTax DC website to learn the status of your refund. It will let you know if your refund matches the amount you claimed and if the refund has been direct deposited into your bank account or mailed. Generally, a refund takes six weeks to process.
You will need to enter your Social Security number and your refund amount. The refund status is only provided for those returns that were filed in the last six months. You will need to contact the Customer Service Administration to inquire into earlier refunds.
For additional information on a refund call 202-727-4TAX or 202-727-4829.
What About Washington, D.C. Taxes if You’re Self-employed?
There isn't a corporate tax for self-employed individuals. Instead, the individual must file taxes through their personal tax return.
What About Washington, D.C. Taxes if You’re a Business?
The business franchise tax for corporations in Washington, D.C. is 8.25 percent.
A corporation must report net income on a combined reporting basis. They must pay a minimum of $250 if their Washington, D.C. gross receipts are $1 million or less. A $1,000 minimum tax is required with over $1 million in gross receipts.
S-corporations pay an 8.25 percent unincorporated business franchise tax. But owners receive a deduction to their personal Washington income taxes for those taxes paid by the business.
Rates and dates in this article are correct as of publication. But check for any changes at the DC.gov Office of Tax and Revenue website before you file.
- DC.gov Office of Tax and Revenue: Individual Income Tax filing FAQs
- DC.gov Office of Tax and Revenue: Tax Forms and Publications
- DC.gov Office of Tax and Revenue: District of Columbia Tax Rate Changes Effective October 1, 2021
- eFile: Washington, DC Income Taxes and DC Tax Forms
- eFile: Washington DC Tax Return, Amendment, etc. Mailing Addresses
- OTR: MyTax DC
- DC.gov Office of Tax and Revenue: DC.gov
- DC.gov Office of Tax and Revenue: Payment Options for Individual Income Tax
- DC.gov Office of Tax and Revenue: DC Business Franchise Tax Rates
Anne attended University of Akron and went on to have a career in television sales. Working as a commercial property and casualty insurance agent for nine years allowed her to learn about different businesses' needs. She has also owned an advertising agency where she created marketing capaigns for various clients. Anne has written for several publications. She currently resides in Charleston, SC.