Bill > B26-0150

This bill amends the District of Columbia's property tax classification rules to streamline the process for converting commercial properties to residential use. Specifically, the bill modifies how properties can be reclassified as Class 1A (residential) property, introducing a new application process for property owners seeking to change their property's classification. Under the new provisions, if a property receives a building permit for residential construction or substantial rehabilitation, it can be reclassified as Class 1A Property. The bill establishes a clear timeline for tax rate application: properties reclassified between October 1 and March 31 will be taxed at the residential rate for the entire tax year, while those reclassified between April 1 and September 30 will be taxed at the residential rate only for the second half of the tax year. The bill also includes important safeguards, such as requiring owners to provide documentation to substantiate the classification change and implementing a "claw back" provision that allows the Chief Financial Officer to reclassify and retroactively tax the property if it is not put to residential use within three years or if the building permit expires. Additionally, property owners are given the right to appeal classification denials and can request extensions or penalty waivers in cases of undue hardship. The act is temporary, applying from April 1, 2025, and expiring after 225 days of taking effect.

https://lims.dccouncil.gov/Legislation/B26-0150