Q. What are the principal classes of real property?
A. There are four classes of real property in the District of Columbia. Class 1A and Class 1B are residential real property including multifamily. Class 2 is commercial and industrial real property including hotels and motels. Class 3 is vacant real property. Class 4 is vacant blighted property.
Q. Is the tax rate the same for all classes of property?
A. No. Residential property, known as Class 1A and Class 1B properties, are taxed at a rate that is lower than that of other classes. For more information, visit Real Property Tax Rates.
Q. What is the Residential Split Tax Rate?
A. The Residential Split Tax Rate is a split rate that taxes residential properties at different rates if they are assessed over $2.5M. The first $2.5M assessed value is taxed at $0.85 and anything over is taxed at the $1.00 rate.
Q. What is the difference between Residential Class 1A and 1B?
A. Class 1A is a property with three or more units (apartments, triplex, etc.) Class 1B is a property with two or less units (single family detached, row house, townhouse and a house with a second living unit (row house with converted English Basement, detached house with separate living area in the back, etc.))
Q. Are all Class 1B properties taxed at the higher ($1.00) tax rate?
A. No. Only the assessed value potion above $2.5M is taxed at the $1.00 rate. (Under $2.5M, is taxed at the lower ($0.85) tax rate.)
Q. How are the Class 1A and 1B taxes calculated?
A. Class 1A calculation: regardless of the assessed value, divide the assessed value by 100 then multiply by the $0.85 tax rate. For example, a property assessed value is $2,600,190; (2,600,190/100) x 0.85 = $22,101..62 annual tax. Class 1B calculation: property assessed at less than $2.5M, divide the assessed value by 100 then multiply by 0.85 tax rate. For example, a property assessed value is $851,760; (851,760/100) x 0.85 = $7,239.96 annual tax. Class 1B calculation; property assessed at more than $2.5M, the $2.5M assessed value portion is taxed at the $0.85 tax rate and the remaining assessed value over $2.5M is taxed at the $1.00 tax rate. For example, a property assessed value is $7,880,380; (2,500,000/100) x 0.85 = $21,250 plus (5,380,380/100) x 1 = $53,803.80 total annual tax $75,053.80.
Q. What if I do not want to be a Class 1B property?
A. A property that is a single unit or a property with an additional unit is a 1B classification and it can not be changed. (Only above the $2.5M assessed value impacted by the $1 tax rate.)
Q.Will the assessed value treshold of $2.5M ever change for Class 1B properties?
A. Yes. The law does allow for adjustments to the threshold based on the Consumer Price Index (CPI).
Q. Can tax relief apply to both classifications, 1A and 1B?
A. Yes. Through an application process, if requirement are met, both 1A and 1B classifications are eligible for various tax relief programs, such as Homestead Deduction, Assessment Cap Credit, and Senior or Disabled Citizen Tax Relief.
Q. When are property tax bills mailed?
A. Bills are mailed twice a year. The first-half of your bill is mailed in February, and the tax payment is due by March 31. The second-half of your bill is mailed in August, and the tax payment is due September 15.
Q. What should I do if my assessment is correct, but the wrong amount appears on my bill?
A. Contact the Office of Tax and Revenue at (202) 727-4TAX and ask to speak with someone in the real property billing section.
Q. What happens if I am late making a payment?
A. Penalty and interest charges will be added to the amount owed. The penalty for late payment of real property tax is 10 percent of the tax, and the interest for late payment is 1.5 percent per month.
Q. What happens if I do not pay my real property taxes?
A. Your property tax lien can be sold at Tax Sale to satisfy your tax liability. You then have the right to redeem your property up to the date the court issues a court order foreclosing your right of redemption and granting the Tax Sale buyer the right to the deed.
To redeem your property, you must pay all taxes, assessments, fees, and costs due and owing to the District of Columbia and legal costs due to the Tax Sale purchaser. Legal fees due and owing to the Tax Sale purchaser should only be paid after the taxes, assessments, fees, and other costs to the District of Columbia have been paid.
Q. What should I do if my property classification shows 3 (vacant) or 4 (blighted) incorrectly?
A. The classification of Class 3 and Class 4 properties is the sole responsibility of the Department of Buildings (DOB). Questions regarding a property's Class 3 or Class 4 status should be directed to DOB by calling (202) 671-3500, by using the tools or live chat feature availble on the DOB website, or by sending an email to vacantbuildings@dc.gov.