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Does DC have a personal property tax?

Yes, Washington, D.C. levies a personal property tax, but only on tangible property used in a trade or business, not on personal vehicles or household goods. The rate is $3.40 per $100 of assessed value, applied only to the portion of your business property's value that exceeds $225,000.

Yes, Washington, D.C. levies a personal property tax, but only on tangible property used in a trade or business, not on personal vehicles or household goods. The rate is $3.40 per $100 of assessed value, applied only to the portion of your business property's value that exceeds $225,000. If your total taxable business property is worth $225,000 or less, you owe nothing. But you still have to file.

What DC's personal property tax actually covers

The tax is levied on all tangible property, except inventories, used in a trade or business. Think restaurant equipment, office furniture, machinery, computer servers, fixtures, and unregistered vehicles or trailers. Personal property includes machinery, equipment, furniture, fixtures, and unregistered motor vehicles and trailers.

What it does not cover: your car, your couch, your laptop at home. Vehicles registered in DC are exempt. DC has never adopted the kind of annual vehicle property tax that Virginia imposes on its residents.

The rate and the exemption threshold

Each year the District levies a tax against every person on the tangible personal property owned or held in trust in that person's trade or business in the District. The rate is $3.40 for each $100 of value of the taxable personal property, in excess of $225,000 in value.

Personal property tax has a flat rate of 3.4% over $225,000. There is no tax due if the value of your personal property is $225,000 or less; however, you must still file the return.

One quirk: DC values your assets using its own straight-line depreciation schedules, not federal ones. For DC's business personal property tax, you report the remaining cost on July 1, what each asset cost, less straight-line depreciation at DC's own rates. You may not use accelerated methods or federal recovery lives, so an asset you wrote off on your federal return can still have a DC value. There's also a floor: you report each asset at no less than 25% of its original cost, or 10% for office computers and peripherals, which DC calls qualified technological equipment.

Who must file, and when

Individuals, corporations, partnerships, executors, administrators, guardians, receivers, and trustees that own or hold personal property in trust in the District of Columbia must file a DC personal property tax return.

The form is FP-31. Filing frequency is annual. The due date is July 31, covering a tax year beginning July 1 through June 30. All personal property tax returns must be filed electronically via MyTax.DC.gov.

The timeline is unusual. Unlike many taxes paid in arrears, this return is filed in advance. The FP-31 is due July 31 each year, and the filing covers the upcoming tax year. The filing due on July 31, 2025, is actually the 2026 Personal Property Tax Return.

Need more time? You request an extension on Form FP-129A before August 1 and pay the tax with the request. DC can grant up to three months, to October 31. Miss the deadline with tax due and the Office of Tax and Revenue charges 5% a month on the unpaid tax, up to 25%.

Who gets an exemption

Entities exempted from this tax include qualified supermarkets, non-profits, and registered motor vehicles and trailers. Wireless telecom companies and certain clean energy systems have also been carved out by legislation over the years. If you close your business, mark your last FP-31 as a final return and OTR will cancel the filing requirement.

How DC compares to Virginia and Maryland

This is the question most DMV residents actually want answered. DC sits in an interesting middle ground.

Virginia is the one that really stings for vehicle owners. Virginia residents often get blindsided by a second levy: an annual personal property tax on vehicles, which Fairfax County sets at $4.57 per $100 of assessed value, about $900 a year on a $30,000 car after state relief. Virginia has a personal property tax on vehicles, trailers, RVs, and boats. In Arlington, the rate is now $5.00 per $100 of assessed value.

Maryland has no annual vehicle property tax. The one-time 6.5% titling excise and a flat two-year registration are the whole bill, nothing value-based recurs. Maryland does, like DC, tax business personal property, with that compliance process flowing through the State Department of Assessments and Taxation.

DC registered vehicle owners pay a one-time excise tax when a vehicle is titled. DC collects a separate motor vehicle excise tax at the issuance of new certificates of title. Vehicles up to 3,499 pounds face a rate of up to 9%. Vehicles from 3,500 to 4,999 pounds face a rate of up to 10%. Vehicles weighing more than that are subject to a rate of up to 11%. After that, there is no annual car tax bill in the mail.

Bottom line for DC businesses

If you run a business in the District with more than $225,000 worth of equipment, furniture, and other tangible assets, you owe DC personal property tax at $3.40 per $100 on the amount above that threshold. File Form FP-31 at MyTax.DC.gov by July 31 each year. The DC Office of Tax and Revenue's official personal property tax page is at otr.cfo.dc.gov. A DC restaurant with $332,000 in taxable equipment, for example, would owe tax on $107,000 above the exemption, coming to $3,638 for the year.

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