Property Tax Alert: District of Columbia

November 2007

Non-exempt real property in the District of Columbia is taxed based on its "classification." Classification is the grouping of properties based on their similar use. Properties in different classes are taxed at different rates. A tax rate is the amount of tax on each $100 of the assessed value of the property. The annual tax rates are established by the District's Council.

The current classes and rates are applicable and effective as of October 1, 2007:

1. Class 1 --$0.85 per $100 of assessed value (for improved residential real property, including multifamily);
2. Class 2 --$1.85 per $100 of assessed value (for commercial and industrial real property, including hotels and motels); and
3. Class 3 --$5.00 per $100 of assessed value (for unimproved, abandoned, or vacant real property).

Note that, for Class 1 residential real property that is owner-occupied, the first $64,000 of assessed value is exempt from tax.

The amount of the real property tax due is determined by dividing the assessed value of the applicable property by $100, and then multiplying that amount by the rate for the class associated with the property. Any applicable homestead deduction, senior citizen deduction, and/or trash credit can be taken at that point.

Please contact Rash & Associates for more information.