Code of the District of Columbia

Subchapter VIII. Tax on Unincorporated Businesses.


§ 47–1808.01. Tax on unincorporated businesses — Definition.

For the purposes of this chapter (not alone of this subchapter) and unless otherwise required by the context, the term “unincorporated business” means any trade or business, conducted or engaged in by any individual, whether resident or nonresident, statutory or common-law trust, estate, partnership, or limited or special partnership, society, association, executor, administrator, receiver, trustee, liquidator, conservator, committee assignee, or by any other entity or fiduciary, other than a trade or business conducted or engaged in by any corporation and include any trade or business which if conducted or engaged in by a corporation would be taxable under subchapter VII of this chapter. The term “unincorporated business” does not include:

(1) A trade or a business which by law, customs, or ethics cannot be incorporated;

(2) A trade, a business, or a profession which can be incorporated only under Chapter 5 of Title 29;

(3) A trade or business in which more than 80% of the gross income is derived from the personal services actually rendered by the individuals or the members of the partnership or other entity in the conducting or the carrying on of a trade or a business and in which capital is not a material income-producing factor;

(4) A trade or a business engaged in by a blind person licensed by the District of Columbia pursuant to An Act To authorize the operation of stands in Federal buildings by blind persons, to enlarge the economic opportunities of the blind, and for other purposes (20 U.S.C. § 107 et seq.);

(5) A Qualified High Technology Company; or

(6) For tax years beginning after December 31, 2014, a trade or business that arises solely by reason of the purchase, holding, or sale of, or the entering, maintaining, or terminating of positions in, stocks, securities, or commodities for the taxpayer’s own account; provided, that this paragraph shall not apply to:

(A) A taxpayer that holds property, or maintains positions, as stock in trade, inventory, or for sale to customers in the ordinary course of the taxpayer’s trade or business;

(B) A taxpayer that acquires debt instruments in the ordinary course of the taxpayer’s trade or business for funds loaned or services rendered; or

(C) A taxpayer that holds any of the following that is not traded on an established securities market:

(i) Stock in a real estate investment trust; or

(ii) A partnership interest.


(July 16, 1947, 61 Stat. 345, ch. 258, art. I, title VIII, § 1; Dec. 10, 1971, 85 Stat. 582, Pub. L. 92-180, § 21; Oct. 21, 1975, D.C. Law 1-23, title VI, § 605, 22 DCR 2113; June 11, 1982, D.C. Law 4-118, § 113, 29 DCR 1770; Oct. 8, 1983, D.C. Law 5-32, § 6(a), 30 DCR 4013; Mar. 12, 1986, D.C. Law 6-89, § 2, 33 DCR 304; Oct. 1, 1987, D.C. Law 7-29, § 3(h)(1), 34 DCR 5097; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Apr. 3, 2001, D.C. Law 13-256, § 405, 48 DCR 730; July 2, 2011, D.C. Law 18-378, § 3(jj)(1)(C), 58 DCR 1720; Feb. 26, 2015, D.C. Law 20-155, § 7012(c)(8), 61 DCR 9990.)

Prior Codifications

1981 Ed., § 47-1808.1.

1973 Ed., § 47-1574.

Section References

This section is referenced in § 2-218.31, § 6-1504, § 47-1803.02, § 47-1803.03, § 47-1805.02, § 47-1806.01, and § 47-1806.04.

Effect of Amendments

D.C. Law 13-256 added par. (5).

D.C. Law 18-378, in par. (2), substituted “Chapter 5” for “Chapter 4”.

The 2015 amendment by D.C. Law 20-155 added (6) and made related changes.

Cross References

Professional corporations, see § 29-401 et seq.

Emergency Legislation

For temporary (90 days) amendment of this section, see § 7022(c)(8) of the Fiscal Year 2015 Budget Support Emergency Act of 2014 (D.C. Act 20-377, July 14, 2014, 61 DCR 7598, 20 STAT 3696).

For temporary (90 days) amendment of this section, see § 7012(c)(8) of the Fiscal Year 2015 Budget Support Congressional Review Emergency Act of 2014 (D.C. Act 20-449, October 10, 2014, 61 DCR 10915, 20 STAT 4188).

For temporary (90 days) amendment of this section, see § 7012(c)(8) of the Fiscal Year 2015 Budget Support Second Congressional Review Emergency Act of 2014 (D.C. Act 20-566, January 9, 2015, 62 DCR 884, 21 STAT 541).

Editor's Notes

Mayor authorized to issue regulations: Section 9 of D.C. Law 5-32 provided that the Mayor shall issue regulations necessary to carry out the provisions of the act.


§ 47–1808.02. Tax on unincorporated businesses — Definitions.

For purposes of this subchapter, the term:

(1) “Taxable income” means the amount of net income derived from sources within the District, within the meaning of §§ 47-1810.01 to 47-1810.03, in excess of the exemption granted under § 47-1808.04; provided, that taxable income shall not include the gross income of a qualified community development entity, as defined in section 45D(c)(1) of the Internal Revenue Code of 1986, that has received an allocation or suballocation of new markets tax credits pursuant to section 45D(f) of the Internal Revenue Code of 1986, but only to the extent that the gross income is derived from one or more qualified low-income community investments, as defined in section 45D(d)(1) of the Internal Revenue Code of 1986.

(2) “Taxable period” means a taxable year, or a portion of a taxable year.


(July 16, 1947, 61 Stat. 346, ch. 258, art. I, title VIII, § 2; Sept. 26, 1984, D.C. Law 5-113, § 302(b)(1), 31 DCR 3974; Oct. 1, 1987, D.C. Law 7-29, § 2(h)(2), 34 DCR 5097; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Sept. 18, 2007, D.C. Law 17-20, § 1022, 54 DCR 7052.)

Prior Codifications

1981 Ed., § 47-1808.2.

1973 Ed., § 47-1574a.

Section References

This section is referenced in § 47-1801.04, § 47-1812.08, and § 47-4215.

Effect of Amendments

D.C. Law 17-20, in par. (1), inserted “; provided, that taxable income shall not include the gross income of a qualified community development entity, as defined in section 45D(c)(1) of the Internal Revenue Code of 1986, that has received an allocation or suballocation of new markets tax credits pursuant to section 45D(f) of the Internal Revenue Code of 1986, but only to the extent that the gross income is derived from one or more qualified low-income community investments, as defined in section 45D(d)(1) of the Internal Revenue Code of 1986”.

Emergency Legislation

For temporary (90 day) amendment of section, see §§ 1022, 1023 of Fiscal Year 2008 Budget Support Emergency Act of 2007 (D.C. Act 17-74, July 25, 2007, 54 DCR 7549).

Short Title

Short title: Section 1021 of D.C. Law 17-20 provided that subtitle C of title I of the act may be cited as the “New Markets Tax Credit Clarification Act of 2007”.

Editor's Notes

Applicability: Section 1023 of D.C. Law 17-20 provided: “Section 1022 shall apply as of October 1, 2007.”

Mayor authorized to issue rules: See second paragraph of note to § 47-2601.


§ 47–1808.03. Tax on unincorporated businesses — Levy and rates.

(a) Except as exempted under subchapter II of this chapter, for the privilege of carrying on or engaging in any trade or business within the District and of receiving income from sources within the District, there is levied:

(1) For 1 taxable year beginning after December 31, 1974, a tax at the rate of 12% upon the taxable income of every unincorporated business, whether domestic or foreign;

(2) For the taxable years beginning after December 31, 1975, a tax at the rate of 9% upon the taxable income of every unincorporated business, whether domestic or foreign, except that, effective October 1, 1984, the rate of tax shall be 10% upon the taxable income for any taxable period, except that for taxable years beginning after December 31, 1994, the rate of tax shall be 9.5%;

(3) For the taxable years beginning after December 31, 2002, a tax at the rate of 9.5% upon the taxable income of every unincorporated business, whether domestic or foreign;

(3A)(A) A surtax at the rate of 2.5% on the tax determined under paragraph (2) or (3) of this subsection, as applicable.

(B) Subparagraph (A) of this paragraph shall apply for any tax period beginning after September 30, 1992.

(3B)(A) A surtax at the rate of 2.5%, separate from and in addition to, the surtax imposed by paragraph (3A) of this subsection, on the tax determined under paragraph (2) or (3) of this subsection, as applicable, for any tax period beginning after September 30, 1994.

(B) Subparagraph (A) of the paragraph shall apply for any tax period beginning after September 30, 1994.

(4) For the taxable years beginning after December 31, 2003, a tax at the rate of 9.975% upon the taxable income of every unincorporated business, whether domestic or foreign;

(5) For the taxable year beginning after December 31, 2014, but before January 1, 2016, a tax at the rate of 9.4% upon the taxable income of every unincorporated business, whether domestic or foreign;

(6) For the taxable year beginning after December 31, 2015, but before January 1, 2017, a tax at the rate of 9.2% upon the taxable income of every unincorporated business, whether domestic or foreign;

(7) For the taxable year beginning after December 31, 2016, but before January 1, 2018, a tax at the rate of 9.0% upon the taxable income of every unincorporated business, whether domestic or foreign; and

(8) For taxable years beginning after December 31, 2017, a tax at the rate of 8.25% upon the taxable income of every unincorporated business, whether domestic or foreign.

(b) The minimum tax payable under this section shall be $250. If District gross receipts are greater than $1 million, the minimum tax payable shall be $1,000.


(July 16, 1947, 61 Stat. 346, ch. 258, art. I, title VIII, § 3; Aug. 2, 1968, 82 Stat. 612, Pub. L. 90-450, title II, § 202(b); Oct. 31, 1969, 83 Stat. 179, Pub. L. 91-106, title VI, § 604(a)(2); Dec. 15, 1971, 85 Stat. 654, Pub. L. 92-196, title IV, §§ 402, 404; Oct. 21, 1975, D.C. Law 1-23, title VI, § 604, 22 DCR 2112; July 27, 1976, D.C. Law 1-77, § 3, 23 DCR 1219; Mar. 16, 1978, D.C. Law 2-58, § 202, 24 DCR 5765; June 22, 1983, D.C. Law 5-14, § 903, 30 DCR 2632; Sept. 26, 1984, D.C. Law 5-113, § 302(b)(2), 31 DCR 3974; Oct. 1, 1987, D.C. Law 7-29, § 2(h)(3), 34 DCR 5097; July 25, 1989, D.C. Law 8-17, § 2(e), 36 DCR 4160; June 14, 1994, D.C. Law 10-128, § 103(d), 41 DCR 2096; Sept. 28, 1994, D.C. Law 10-188, § 301(b)(1), 41 DCR 5333; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Oct. 20, 1999, D.C. Law 13-38, § 2702(j), 46 DCR 6373; Oct. 1, 2002, D.C. Law 14-190, § 802(d), 49 DCR 6968; June 5, 2003, D.C. Law 14-307,§ 1002(b), 49 DCR 11664; Sept. 14, 2011, D.C. Law 19-21, § 8072(b), 58 DCR 6226; Feb. 26, 2015, D.C. Law 20-155, § 7012(c)(9), 61 DCR 9990; Oct. 8, 2016, D.C. Law 21-160, § 7028(c)(5), 63 DCR 10775; Dec. 13, 2017, D.C. Law 22-33, § 7172(f), 64 DCR 7652.)

Prior Codifications

1981 Ed., § 47-1808.3.

1973 Ed., § 47-1574b.

Section References

This section is referenced in § 10-1203.07, § 32-241, § 47-340.26, § 47-1807.07, § 47-1808.04, § 47-1808.05, § 47-1808.08, § 47-1812.08, § 47-4215, and § 50-1501.02.

Effect of Amendments

D.C. Law 13-38 rewrote subsec. (a)(3) and repealed subsec. (a)(4).

Section 2702(j)(2)(B) of D.C. Law 13-38 provided: 'This paragraph shall be effective for tax years beginning after December 31, 2002.'

Section 2703(c) of D.C. Law 13-38 provided: “Section 2702(f), (h), (i), and (j) shall apply for tax years beginning after December 31, 1999.”

D.C. Law 14-190, in subsec. (a), rewrote pars. (3) and (4) which had read as follows:

“(3)(A) For the taxable years beginning after December 31, 2002, a tax at the rate of 9% upon the taxable income of every unincorporated business, whether domestic or foreign, except that for taxable years beginning after December 31, 2003, the rate of tax shall be 8.5%.

“(B) Subparagraph (A) of this paragraph shall not apply if the certification by the Chief Financial Officer required by 47-387.01 demonstrates that the accumulated general fund balance for the immediately preceding fiscal year is less than 5% of the general fund operating budget for the current fiscal year, the nominal GDP growth is less than or equal to 3.5% or the real GDP growth is less than or equal to 1.7%.”

‘(4) [Repealed].‘

D.C. Law 14-307, in subsec. (a), substituted “9.5%” for “9.0%” in par. (3), added pars. (3A) and (3B), and rewrote par. (4)(A) which had read as follows:

“(a)(4)(A) For the taxable years beginning after December 31, 2003, a tax at the rate of 8.5% upon the taxable income of every corporation, whether domestic or foreign.”

“(B) Subparagraph (A) of this paragraph shall not apply if:

“(i) The certification by the Chief Financial Officer required by § 47-387.01 demonstrates that the accumulated general fund balance for the immediately preceding fiscal year is less than 5% of the general fund operating budget for the current fiscal year, the nominal GDP growth is less than or equal to 3.5%, or the real GDP growth is less than or equal to 1.7%; or

“(ii) The Mayor demonstrates, and the Chief Financial Officer certifies, that a proposed budget will not be balanced as required by § 1-206.03(c) if the scheduled tax rate decrease under subparagraph (A) of this paragraph takes effect.”

D.C. Law 19-21, in subsec. (b), substituted “shall be $250. If District gross receipts are greater than $1 million, the minimum tax payable shall be $1,000.” for “shall be $100”.

The 2015 amendment by D.C. Law 20-155 added (a)(5) and (a)(6).

Cross References

Tax rate changes, authority of the Council of the District of Columbia, see § 47-504.

Washington Convention Center Authority, collection and allocation of taxes under this section, see § 10-1203.07.

Applicability

Section 7174 of Law 22-33 provided that the changes made to this section by Law 22-33 shall apply as of January 1, 2018.

Emergency Legislation

For temporary (90 days) amendment of this section, see § 7172(f) of Fiscal Year 2018 Budget Support Congressional Review Emergency Act of 2017 (D.C. Act 22-167, Oct. 24, 2017, 64 DCR 10802).

For temporary (90 days) amendment of this section, see § 7172(f) of Fiscal Year 2018 Budget Support Emergency Act of 2017 (D.C. Act 22-104, July 20, 2017, 64 DCR 7032).

For temporary (90 days) amendment of this section, see § 2(b) of Franchise Tax Clarification Emergency Amendment Act of 2016 (D.C. Act 21-402, May 19, 2016, 63 DCR 7923).

For temporary (90 day) amendment of section, see §§ 202 and 203 of Tax Parity Rates and Unincorporated Business Franchise Tax Rate Clarification Emergency Act of 2002 (D.C. Act 14-309, March 25, 2002, 49 DCR 3416).

For temporary (90 day) amendment of section, see § 1002(b) and 1003 of Fiscal Year 2003 Budget Support Amendment Emergency Act of 2002 (D.C. Act 14-544, December 4, 2002, 49 DCR 11700).

For temporary (90 day) amendment of section, see §§ 1002(b) and 1003 of the Fiscal Year 2003 Budget Support Amendment Congressional Review Emergency Act of 2003 (D.C. Act 15-27, February 24, 2003, 50 DCR 2151).

For temporary (90 day) amendment of section, see § 802(d) of Fiscal Year 2003 Budget Support Emergency Act of 2002 (D.C. Act 14-453, July 23, 2002, 49 DCR 8026).

For temporary (90 day) amendment of section, see §§ 1002(b) and 1003 of Fiscal Year 2003 Budget Support Amendment Second Congressional Review Emergency Act of 2003 (D.C. Act 15-103, June 20, 2003, 50 DCR 5499).

For temporary (90 day) amendment of section 8074 of D.C. Law 19-21, see § 2(b) of Revised Fiscal Year 2012 Budget Support Technical Clarification Emergency Amendment Act of 2011 (D.C. Act 19-157, October 4, 2011, 58 DCR 8688).

For temporary (90 days) amendment of this section, see § 7022(c)(9) of the Fiscal Year 2015 Budget Support Emergency Act of 2014 (D.C. Act 20-377, July 14, 2014, 61 DCR 7598, 20 STAT 3696).

For temporary (90 days) amendment of this section, see § 7012(c)(9) of the Fiscal Year 2015 Budget Support Congressional Review Emergency Act of 2014 (D.C. Act 20-449, October 10, 2014, 61 DCR 10915, 20 STAT 4188).

For temporary (90 days) amendment of this section, see § 7012(c)(9) of the Fiscal Year 2015 Budget Support Second Congressional Review Emergency Act of 2014 (D.C. Act 20-566, January 9, 2015, 62 DCR 884, 21 STAT 541).

For temporary (90 days) amendment of this section, see § 10(c) of the Fiscal Year 2016 Budget Support Clarification Emergency Amendment Act of 2016 (D.C. Act 21-292, Jan. 27, 2016, 63 DCR 1211).

Temporary Legislation

For temporary (225 day) amendment of section, see § 202(a) of Tax Parity Rates and Unincorporated Business Franchise Tax Rate Clarification Temporary Act of 2002 (D.C. Law 14-163, June 25, 2002, law notification 49 DCR 6499).

Editor's Notes

Expiration of §§ 301, 302 and 303 of D.C. Law 10-188: See Historical and Statutory Notes following § 47-1807.02a.

Mayor authorized to issue rules: Section 1102 of D.C. Law 5-14 provided that the Mayor shall issue rules necessary to carry out the provisions of the act.

Audit of accounts and operation of Authority: See Historical and Statutory Notes following § 47-1807.02a.

Expiration of §§ 301, 302 and 303 of D.C. Law 10-188: Section 2(l)(1) of D.C. Law 12-142 provided that § 306(a) of D.C. Law 10-188, providing for the expiration of that act, is repealed.

Section 1003 of D.C. Law 14-307 provided: “Sec. 1003. Applicability. Section 1002 shall apply as of January 1, 2003.”

Sections 8073 and 8074 of D.C. Law 19-21 provided:

“Sec. 8073. Rules.

“The Mayor, pursuant to Title I of the District of Columbia Administrative Procedure Act, approved October 21, 1968 (82 Stat. 1204; D.C. Official Code § 2-501 et seq.), may issues rules to implement the provisions of this subtitle.

“Sec. 8074. Applicability.

“This subtitle shall apply as of December 31, 2010.”

Delegation of Authority

Delegation of authority under Law 5-14, see Mayor’s Order 83-190, July 25, 1983.


§ 47–1808.03a. Tax on unincorporated businesses — Transfer of surtax to Convention Center Authority. [Repealed]

Repealed.


(July 16, 1947, 61 Stat. 331, ch. 258, art. I, title VIII, § 3a; as added Sept. 28, 1994, D.C. Law 10-188, § 301(b)(2), 41 DCR 5333; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Aug. 12, 1998, D.C. Law 12-142,§ 3(a), 45 DCR 4826.)

Prior Codifications

1981 Ed., § 47-1808.3a.

Cross References

Washington Convention Center Authority, collection and allocation of taxes under this section, see § 10-1203.07.

Editor's Notes

Expiration of §§ 301, 302 and 303 of D.C. Law 10-188: See Historical and Statutory Notes following § 47-1807.02a.

Audit of accounts and operation of Authority: See Historical and Statutory Notes following § 47-1807.02a.


§ 47–1808.04. Tax on unincorporated businesses — Exemption.

Before computing the tax upon the taxable income of an unincorporated business, there shall be deducted therefrom an exemption of $5,000; except, that where the period covered by a return is less than a year, or where a return shows that an unincorporated business has been carried on for less than 12 months, such exemption shall be prorated on a daily basis; provided, however, that any amount exempt under this section from the tax imposed by § 47-1808.03 shall be reported and included in the gross income of that person or those persons entitled to a share therein in proportion to the share to which each person is entitled, and shall be reported in the return of each such person for his or her taxable year in which is ended the taxable year of the unincorporated business.


(July 16, 1947, 61 Stat. 346, ch. 258, art. I, title VIII, § 4; May 27, 1949, 63 Stat. 132, ch. 146, title IV, § 416; Feb. 3, 1976, D.C. Law 1-44, § 4, 23 DCR 4057; Oct. 8, 1983, D.C. Law 5-32, § 6(b), 30 DCR 4013; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575.)

Prior Codifications

1981 Ed., § 47-1808.4.

1973 Ed., § 47-1574c.

Section References

This section is referenced in § 6-1504, § 47-1803.03, and § 47-1808.02.

Cross References

Economic development zones, eligibility for tax incentives, see § 6-1504.

Editor's Notes

Mayor authorized to issue regulations: Section 9 of D.C. Law 5-32 provided that the Mayor shall issue regulations necessary to carry out the provisions of the act.


§ 47–1808.05. Tax on unincorporated businesses — Persons liable for payment.

The taxes imposed by § 47-1808.03 shall be payable by the person or persons, jointly and severally, conducting the unincorporated business. The taxes imposed under this subchapter may be assessed in the name of the unincorporated business or in the name or names of the person or persons liable for the payment of such taxes, or both.


(July 16, 1947, 61 Stat. 346, ch. 258, art. I, title VIII, § 5; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575.)

Prior Codifications

1981 Ed., § 47-1808.5.

1973 Ed., § 47-1574d.


§ 47–1808.06. Partnerships.

Individuals carrying on any trade or business in partnership in the District, other than an unincorporated business, shall be liable for income tax only in their individual capacities. The tax on all such income shall be assessed against the individual partners under §§ 47-1806.01 to 47-1806.06. There shall be included in computing the net income of each partner his distributive share, whether distributed or not, of the net income of the partnership for the taxable year; or if his net income for such taxable year is computed upon the basis of a period different from that upon the basis of which the net income of the partnership is computed, then his distributive share of the net income of the partnership for any accounting period of the partnership ending within the taxable year upon the basis of which the partner’s net income is computed. The term “accounting period” as used in this section refers to the calendar or fiscal year of a partnership.


(July 16, 1947, 61 Stat. 346, ch. 258, art. I, title VIII, § 6; Oct. 1, 1987, D.C. Law 7-29, § 2(h)(4), 34 DCR 5097; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575.)

Prior Codifications

1981 Ed., § 47-1808.6.

1973 Ed., § 47-1574e.


§ 47–1808.06a. Taxation of limited liability companies.

For purposes of District income and franchise taxation, a limited liability company formed under Chapter 8 of Title 29 or a foreign limited liability company registered to do business in the District under Chapter 1 of Title 29 shall be classified as a partnership unless classified otherwise for federal income tax purposes, in which case the limited liability company shall be classified in the same manner as it is classified for federal income tax purposes. For purposes of District income and franchise taxation, a member or an assignee of a member of a limited liability company formed or subject to Title 29 shall be treated as either a resident or nonresident partner unless classified otherwise for federal income tax purposes, in which case the member or assignee of a member shall have the same status as such member or assignee of a member has for federal income tax purposes.


(July 2, 2011, D.C. Law 18-378, § 3(jj)(1)(D), 58 DCR 1720; Sept. 26, 2012, D.C. Law 19-171, § 89(c), 59 DCR 6190.)

Effect of Amendments

The 2012 amendment by D.C. Law 19-171 made a technical correction to D.C. Law 18-378 which did not affect this section as codified.

Editor's Notes

Applicability date of D.C. Law 18-378: Section 5 of D.C. Law 18-378, as amended by section 7082 of D.C. Law 19-21, provided: “Sec. 5. Applicability. This act shall apply as of January 1, 2012.”.


§ 47–1808.07. Tax credit.

For taxable years beginning after December 31, 1988, the amount of tax payable by an unincorporated business approved as qualified under § 6-1504 shall be reduced by a credit equal to the credits available to qualified incorporated businesses pursuant to §§ 47-1807.04, 47-1807.05, 47-1807.06, and 47-1807.07.


(July 16, 1947, ch. 258, art. I, title VIII, § 7; as added Oct. 20, 1988, D.C. Law 7-177, § 10(c), 35 DCR 6158; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Apr. 19, 2002, D.C. Law 14-114, § 901(b)(3), 49 DCR 1468.)

Prior Codifications

1981 Ed., § 47-1808.7.

Section References

This section is referenced in § 6-1504 and § 47-1803.03.

Effect of Amendments

D.C. Law 14-114 substituted “47-1807.06, and 47-1807.07” for “and 47-1807.06”.

Editor's Notes

Mayor authorized to issue rules: See Historical and Statutory Notes following § 47-1803.03.


§ 47–1808.08. Tax credit for unincorporated businesses that provide an employee paid leave to serve as an organ or bone marrow donor.

(a) For the purposes of this section, the term “donor”” means an individual who makes a gift of an organ, including eyes, or bone marrow.

(b)(1) If in addition to any medical, personal, or other paid leave, including credit for time of service, provided by an unincorporated business, the unincorporated business provides an employee a paid leave of absence to serve as an organ or bone marrow donor, the unincorporated business may claim a credit equal to 25% of the regular salary or wages to the employee paid during the taxable year for that leave of absence, not to exceed 30 days for an organ donation and 7 days for a bone marrow donation.

(2) If the unincorporated business elects to claim the credit, an amount equal to the salary or wages upon which the 25% credit is computed shall not be allowed as a deduction.

(3) The credit shall not reduce the minimum tax liability of $100 [now $250] under § 47-1808.03(b).

(c) This section shall not apply if the employee is eligible for leave under the Family and Medical Leave Act of 1993, approved February 5, 1993 (107 Stat. 6; 29 U.S.C. § 2601 et seq.).

(d) The Chief Financial Officer or his delegate shall promulgate regulations as may be necessary and appropriate to carry out provisions of this section.


(Mar. 6, 2007, D.C. Law 16-211, § 2(c), 53 DCR 9852; Mar. 25, 2009, D.C. Law 17-353, § 145, 56 DCR 1117.)

Effect of Amendments

D.C. Law 17-353 validated a previously made technical correction in subsec. (b)(3).

Emergency Legislation

For temporary (90 day) addition, see § 2(d) of Employment of Returning Veteran’s Tax Credit Emergency Act of 2008 (D.C. Act 17-654, January 6, 2009, 56 DCR 933).

Temporary Legislation

Section 2(d) of D.C. Law 17-384 added a section to read as follows:

§ 47-1808.09. Tax credit for hiring qualified veterans.

“(a) For the purposes of this section, the term:

“(1) ‘Armed Forces’ shall include any branch of the United States Military, including the Army, Navy, Marines, Air Force, Coast Guard, or any National Guard or reserve deployment lasting 6 continuous months or longer.

“(2) ’Qualified veteran’ means an individual subject to the District’s personal income tax who:

“(A) Has previously served in a branch of the Armed Forces and who was honorably or generally discharged;

“(B) Is not currently employed in a facility owned or operated by the District business with an exemption under § 47-4605;

“(C) Is hired to fill a position of indefinite duration consisting of a minimum of 35 hours per week for not less than 48 weeks per year;

“(D) Is hired within 5 years after being discharged from the Armed Forces or within 2 years of a continuous 6-month National Guard deployment;

“(E) Is a District resident at the time of hiring and maintains District residency for the duration of the 2-year tax credit period; and

“(F) Is not currently employed in a facility owned or operated by the District business seeking the tax credit under this section.

“(b) For taxable years beginning on or after January 1, 2009, an employer shall be allowed a credit against the tax imposed by § 47-1808.03 in an amount equal to 10% of the wages paid by the employer to a qualified veteran during the first 24 calendar months in which the employer employs the qualified veteran. The credit under this section shall not exceed $5,000 in the aggregate for each qualified veteran who is employed.

“(c) The maximum annual credit allowed under this section shall not exceed the lesser of:

“(1) Ten percent of the wages paid to a qualified veteran during the tax year in which the credit is claimed;

“(2) The total income taxes imposed on the business during the tax year in which the credit is sought; or

“(3) A total of $2,500 for each eligible veteran.

“(d) The credit under subsection (b) of this section shall not be valid:

“(1) For any wages paid in a calendar month in which the employer has not employed the qualified veteran for at least 90 hours;

“(2) If the employer pays the qualified veteran less than the greater of the legal minimum wage or the wage the employer pays other employees in similar jobs;

“(3) If the employer accords the qualified veteran lesser benefits or rights than the employer accords other employees in similar jobs;

“(4) If the qualified veteran was employed as the result of the displacement, other than for cause, of another employee, or as the result of a strike or lockout, a layoff in which other employees are awaiting recall, or a reduction of the regular wages, benefits, or rights of other employees in similar jobs;

“(5) If the employer does not meet, with respect to the employment of the qualified veteran, all federal and District laws and regulations, including those concerning health, safety, child labor, work/hour, and equal employment opportunity;

“(6) If the qualified veteran is a member of the board of directors of the business, directly or indirectly owns a majority of its stock, or is related to a member of the board of directors or a majority stockholder as a spouse or as any relative listed in the definition of dependent in section 152 of the Internal Revenue Code of 1986 without regard to source of income; or

“(7) If the qualified veteran moves his or her residence outside the District of Columbia during the 24 month period.”.

Section 5(b) of D.C. Law 17-384 provided that the act shall expire after 225 days of its having taken effect.

Editor's Notes

Applicability: Section 3 of D.C. Law 16-211 provided:

“(a) The Chief Financial Officer shall include the fiscal effect of the legislation in its next revised quarterly revenue estimate.

“(b) Section 2 shall not take effect unless the fiscal effect of the legislation is funded in a revised quarterly revenue estimate of the Chief Financial Officer in an amount sufficient to account for its fiscal effect.”


§ 47–1808.09. Job growth tax credit.

A job growth tax credit shall be allowed as provided in subchapter VII-A of this chapter [§ 47-1807.56 et seq.].


(July 27, 2010, D.C. Law 18-202, § 2(d), 57 DCR 4746.)

Emergency Legislation

For temporary (90 day) repeal of § 4 of D.C. Law 18-202, see § 715 of Fiscal Year 2011 Supplemental Budget Support Emergency Act of 2010 (D.C. Act 18-694, January 19, 2011, 58 DCR 662).

Editor's Notes

Sections 3 and 4 of D.C. Law 18-202 provided:

“Sec. 3. Sunset.

“This act shall expire on January 1, 2030.

“Sec. 4. Applicability.

“This act shall apply upon the inclusion of its fiscal effect in an approved budget and financial plan.”

Section 715 of D.C. Law 18-370 repealed section 3 of D.C. Law 18-202.


§ 47–1808.10. Tax on unincorporated business — Credits — Alternative fuel infrastructure credit.

(a) Beginning with the taxable year after December 31, 2013, through the taxable year ending December 31, 2026, there shall be allowed against the tax imposed on an eligible applicant by § 47-1808.03 a credit in the amount of 50% of the equipment and labor costs directly attributable to the purchase and installation of alternative fuel storage and dispensing or charging equipment on a qualified alternative fuel vehicle refueling property, not to exceed $10,000 per qualified alternative fuel vehicle refueling property or per vehicle-charging station.

(b) The equipment and labor costs for which a tax credit may be claimed under this section shall not include costs associated with the:

(1) Purchase of land, or access to land, to be used as a qualified alternative fuel vehicle refueling property;

(2) Purchase of an existing qualified alternative fuel vehicle refueling property; or

(3) Construction or purchase of any structure.

(c) The credit claimed under this section in any one tax year may not exceed the taxpayer’s tax liability under § 47-1808.03 for that year.

(d) If the amount of the tax credit permitted under this section exceeds the tax otherwise due under § 47-1808.03, the amount of the credit not used may be carried forward for up to 2 tax years. The credit shall not be refundable.

(e) If the alternative fuel storage and dispensing equipment or charging equipment on a qualified alternative fuel vehicle refueling property is no longer used to dispense or sell alternative fuel to the public, any unused tax credit shall be forfeited and the taxpayer may not claim a tax credit for the portion of the tax year after the date on which the alternative fuel storage and dispensing equipment was no longer used to dispense or sell alternative fuel to the public.

(f) For the purposes of this section, the term:

(1) “Alternative fuel” shall have the same meaning as provided in § 47-1806.12(f)(1).

(2) “Eligible applicant” means an unincorporated business that is the owner or lessee of a qualified alternative fuel vehicle refueling property.

(3) “Qualified alternative fuel vehicle refueling property” shall have the same meaning as provided in § 47-1806.12(f)(3).


(Feb. 26, 2015, D.C. Law 20-155, § 7072(d), 61 DCR 9990.)

Emergency Legislation

For temporary (90 days) addition of this section, see § 7082(d) of the Fiscal Year 2015 Budget Support Emergency Act of 2014 (D.C. Act 20-377, July 14, 2014, 61 DCR 7598, 20 STAT 3696).

For temporary (90 days) addition of this section, see § 7072(d) of the Fiscal Year 2015 Budget Support Congressional Review Emergency Act of 2014 (D.C. Act 20-449, October 10, 2014, 61 DCR 10915, 20 STAT 4188).

For temporary (90 days) addition of this section, see § 7072(d) of the Fiscal Year 2015 Budget Support Second Congressional Review Emergency Act of 2014 (D.C. Act 20-566, January 9, 2015, 62 DCR 884, 21 STAT 541).


§ 47–1808.11. Tax on unincorporated businesses — Credits — Alternative fuel vehicle conversion credit.

(a) Beginning with the taxable year after December 31, 2013, through the taxable year ending December 31, 2026, there shall be allowed against the tax imposed by § 47-1808.03 a credit in the amount of 50% of the equipment and labor costs directly attributable to the cost to convert a motor vehicle licensed in the District that operates on petroleum diesel or petroleum derived gasoline to a motor vehicle that operates on an alternative fuel.

(b) The credit claimed under this section in any one tax year may not exceed the taxpayer’s tax liability under § 47-1808.03 for that year. The credit shall not be refundable.

(c) For the purposes of this section, the term “alternative fuel” shall have the same meaning as provided in § 47-1806.12(f)(1).


(Feb. 26, 2015, D.C. Law 20-155, § 7072(d), 61 DCR 9990.)

Emergency Legislation

For temporary (90 days) addition of this section, see § 7082(d) of the Fiscal Year 2015 Budget Support Emergency Act of 2014 (D.C. Act 20-377, July 14, 2014, 61 DCR 7598, 20 STAT 3696).

For temporary (90 days) addition of this section, see § 7072(d) of the Fiscal Year 2015 Budget Support Congressional Review Emergency Act of 2014 (D.C. Act 20-449, October 10, 2014, 61 DCR 10915, 20 STAT 4188).

For temporary (90 days) addition of this section, see § 7072(d) of the Fiscal Year 2015 Budget Support Second Congressional Review Emergency Act of 2014 (D.C. Act 20-566, January 9, 2015, 62 DCR 884, 21 STAT 541).


§ 47–1808.12. Tax on unincorporated businesses — Credits — Tax credit for farm to food donations. [Repealed]

[Repealed].


(Apr. 30, 2015, D.C. Law 20-248, § 201(c)(4), 62 DCR 1504; Apr. 7, 2017, D.C. Law 21-257, § 3(b)(4), 64 DCR 2049.)


§ 47–1808.13. Wheelchair-accessible vehicle tax credit. [Not Funded]

Not Funded.


(Apr. 7, 2017, D.C. Law 21-242, § 3(d), 64 DCR 1608.)

Applicability

Applicability of D.C. Law 21-242: § 4 of D.C. Law 21-242 provided that the creation of this section by § 3(d) of D.C. Law 21-242 is subject to the inclusion of the law’s fiscal effect in an approved budget and financial plan. Therefore that amendment has not been implemented.


§ 47–1808.14. Retailer property tax relief credit.

(a) For the purposes of this section, the term:

(1) "Qualified retail owned location" means a building or part of a building in the District that during the taxable year is:

(A) The primary place of the retail business of the qualified unincorporated business;

(B) Owned by the qualified unincorporated business; and

(C) Classified, in whole or in part, as Class 2 Property, as defined in § 47-813 and has obtained a Certificate of Occupancy for commercial use.

(2) "Qualified retail rental location" means a building or part of a building in the District that during the taxable year is:

(A) A retail establishment as defined in § 47-2001(m);

(B) The primary place of the retail business of the qualified unincorporated business;

(C) Leased by the qualified unincorporated business; and

(D) Classified, in whole or in part, as Class 2 Property, as defined in § 47-813 and has obtained a Certificate of Occupancy for commercial use.

(3) "Qualified unincorporated business" means a business that:

(A) Is engaged in making sales at retail and files a sales tax return pursuant to Chapter 20 of this title reflecting those sales;

(B) Has less than $2.5 million in federal gross receipts or sales; and

(C) Is current on all District tax filings and payments.

(b) For taxable years beginning after December 31, 2017, a qualified unincorporated business may claim a credit against the tax imposed by this chapter as follows:

(1) A tax credit equal to 10% of the total rent paid by the qualified unincorporated business for a qualified rental retail location during the taxable year not to exceed $5,000; or

(2) A tax credit equal to the total Class 2 real property taxes, pursuant to § 47-811, paid by the qualified unincorporated business for a qualified retail owned location during the taxable year not to exceed the lesser of the real property tax paid during the taxable year or $5,000.

(c) The credit claimed under this section in any one taxable year may exceed the qualified unincorporated business's tax liability, including any minimum tax due under § 47-1807.02(b), under this chapter for that taxable year and shall be refundable to the qualified unincorporated business claiming the credit.

(d) This section shall not apply if the qualified unincorporated business is exempt from or receives any tax credits towards its real property tax or the qualified rental retail location or qualified owned retail location is otherwise exempt from real property tax.


(Oct. 30, 2018, D.C. Law 22-168, § 7252(c), 65 DCR 9388.)

Emergency Legislation

For temporary (90 days) amendment of this section, see § 5(b) of Fiscal Year 2019 Budget Support Clarification Congressional Review Emergency Amendment Act of 2018 (D.C. Act 22-552, Dec. 31, 2018, 66 DCR 251).

For temporary (90 days) amendment of this section, see § 5(b) of Fiscal Year 2019 Budget Support Clarification Emergency Amendment Act of 2018 (D.C. Act 22-488, Oct. 22, 2018, 65 DCR12046).

For temporary (90 days) amendment of this section, see § 2(b)(2) of Fiscal Year 2019 Budget Support Clarification Emergency Amendment Act of 2018 (D.C. Act 22-488, Oct. 22, 2018, 65 DCR12046).

For temporary (90 days) creation of this section, see § 7252(c) of Fiscal Year 2019 Budget Support Congressional Review Emergency Act of 2018 (D.C. Act 22-458, Oct. 3, 2018, 65 DCR 11212).

For temporary (90 days) creation of this section, see § 7252(c) of Fiscal Year 2019 Budget Support Emergency Act of 2018 (D.C. Act 22-434, July 30, 2018, 65 DCR 8200).