Washington, D.C. Taxes: A Simple Guide
The District of Columbia (Washington, D.C.) has its own income tax, sales tax, and property taxes, separate from nearby states. This guide explains the basics in plain language for individuals.
ℹ️Important: This is a general overview. D.C. tax rules and rates change over time. Always check official D.C. guidance or consult a tax professional for current details.
🏛️D.C. individual income tax
D.C. taxes personal income with its own brackets and rules, similar to a state income tax. In general:
- •Residents with income above certain thresholds must file a D.C. individual income tax return.
- •Nonresidents may have D.C. filing obligations if they earn income that is taxed by the District.
- •D.C. defines taxable income, deductions, and credits under its own law, which may differ from federal rules.
If you live in D.C., you generally file a federal Form 1040 and a D.C. return for the same year if you meet filing requirements.
🛒Sales and use tax
D.C. has a sales and use tax on many retail sales of goods and certain services within the District.
- •Some items (such as certain groceries or medicines) may be treated differently or exempt.
- •If you purchase taxable items outside D.C. for use in the District without paying tax, you may owe use tax.
Businesses operating in D.C. generally must register and collect sales (and possibly other business) taxes on taxable transactions.
🏡Property taxes
Property taxes in D.C. are imposed on real property located within the District, based on assessed value.
- •Homeowners receive property tax bills directly from the city.
- •Property taxes fund District services, including schools, infrastructure, and public safety.
- •Some homeowners may be eligible for credits, relief, or special programs based on age, income, or other factors.
🔗Putting D.C. taxes together
A typical D.C. resident may deal with several layers of tax:
- •Federal income tax (Form 1040)
- •D.C. individual income tax
- •D.C. sales and use tax on many purchases
- •D.C. property taxes if they own a home in the District
Understanding general concepts like taxable income and how to file your taxes makes it easier to see how D.C.'s rules fit into your overall tax picture.