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Washington DC. Property Tax Updates

Updated september 2018

Enacted Changes to Commercial Property Tax Rate

In March of this year, Mayor Muriel Bowser proposed to increase the commercial tax rate by $0.02 to help pay for dedicated Metro funding. Her proposal would have increased the tax rate from $1.85 per $100 of assessed value, for each dollar of assessed value over $3 million, to $1.87 per $100 of assessed value. The first $3 million of assessed value would continue to be taxed at $1.65. After deliberation, DC Council amended Mayor Bowser’s proposal by further increasing the commercial tax rates and abolishing the previous blended rate structure. The new rates, finalized this past month following the mandatory Congressional review period, are as follows:

New Rates - Tax Year 2019         

Assessment                       Rate
$1 - $5,000,000                      1.65%
$5,000,001 - $10,000,000      1.77%
$10,000,001 +                        1.89%                       

Unlike the existing rates, the new rates are not blended.  For example, if your property is assessed for $10,000,000 the property will be taxed entirely at the 1.77% rate.  If, however, your property is assessed for $10,000,001 the property will be taxed entirely at the 1.89% rate. For example, a $100M office building will see an increased tax liability of $46,000. There is no change to the residential rate of 0.85%. The changes will take effect for Tax Year 2019 (October 1, 2018 through September 20, 2019).

Scott B. Cryder, Esq.
Wilkes Artis, Chtd.
American Property Tax Counsel (APTC)

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