The DC income tax is a progressive tax with seven brackets running from 4 percent on the first $10,000 of taxable income up to 10.75 percent on income above $1 million. The District starts from your federal adjusted gross income, then applies its own standard deduction, credits, and adjustments to reach your local bill. For tax year 2025 returns due in April 2026, two changes matter most: DC’s local Earned Income Tax Credit now fully matches the federal EITC, and the DC standard deduction is set by the District itself rather than mirroring the federal amount.
Rates and Brackets for 2025
The rates below apply to taxable years beginning after December 31, 2021, and remain in effect for 2025 and 2026 returns.1D.C. Law Library. District of Columbia Code 47-1806.03 – Tax on Residents and Nonresidents — Imposition and Rates
- Up to $10,000: 4 percent
- $10,001 to $40,000: $400 plus 6 percent of the amount over $10,000
- $40,001 to $60,000: $2,200 plus 6.5 percent of the amount over $40,000
- $60,001 to $250,000: $3,500 plus 8.5 percent of the amount over $60,000
- $250,001 to $500,000: $19,650 plus 9.25 percent of the amount over $250,000
- $500,001 to $1,000,000: $42,775 plus 9.75 percent of the amount over $500,000
- Over $1,000,000: $91,525 plus 10.75 percent of the amount over $1,000,000
Each rate applies only to the income inside that bracket, not to your whole paycheck. If you have $70,000 in taxable income, the 8.5 percent rate only touches the last $10,000; the earlier dollars are taxed at 4, 6, and 6.5 percent within their own bands.
Who Has to Pay
You owe DC income tax if either of two tests is met. The first is domicile. If your permanent legal home is in the District, you’re a resident no matter how many nights you spend elsewhere. The second is physical presence. If you kept a place to live in DC for 183 days or more during the tax year, DC treats you as a statutory resident even when your permanent home is somewhere else. Moving into DC with the intent to make it home triggers resident status right away, without waiting out the 183 days.
One narrow boundary is worth flagging. Under 4 U.S.C. § 113, a Member of Congress who keeps a residence in DC solely to attend sessions is not treated as a DC resident, and their congressional pay cannot be taxed by the District. The exemption reaches delegates from DC, Guam, the U.S. Virgin Islands, and the Resident Commissioner from Puerto Rico. It does not cover congressional staff, who are taxed under the normal residency rules like anyone else.
The 2025 Standard Deduction
DC decoupled its standard deduction from the federal amount in 2025, opting out of the higher figure in the One Big Beautiful Bill Act.2Council of the District of Columbia. Council Separates Elements of District Tax Code from the Federal, Funds Family Tax Savings and Child Tax Credit, Reinstates Temporary Juvenile Curfew For tax year 2025 the DC “basic standard deduction” amounts are:
- Single or married filing separately: $15,000
- Head of household: $22,500
- Married filing jointly or surviving spouse: $30,000
Beginning with tax year 2026, DC will index these figures annually for cost of living. If you itemize instead, keep records for the usual categories like property taxes and charitable gifts.
Credits That Cut Your Bill
Several DC credits and deductions can meaningfully lower what you owe, and some are refundable, meaning you get the money even if your tax comes to zero.
Earned Income Tax Credit
The DC EITC now equals 100 percent of your federal EITC, up from the previous 40 to 70 percent match.3Office of the Chief Financial Officer. DC EITC A federal EITC of $3,000 brings another $3,000 from DC. You have to file a DC return and claim the federal credit to receive the local match.
Child Tax Credit
Starting with tax year 2026, DC has a local child tax credit worth up to $1,000 per dependent child under 18. It’s fully refundable, with no cap on the number of children, and it phases in for individual earners under $75,000 and couples under $90,000.2Council of the District of Columbia. Council Separates Elements of District Tax Code from the Federal, Funds Family Tax Savings and Child Tax Credit, Reinstates Temporary Juvenile Curfew
Schedule H Property Tax Credit
Homeowners and renters can claim a property tax credit through Schedule H. For 2025, household income must be $68,000 or less, or $90,000 if you’re 70 or older. The maximum credit is $1,425.4Office of Tax and Revenue. 2025 Schedule H Homeowner and Renter Property Tax Credit Renters qualify because DC treats a portion of rent as an indirect property tax payment.
College Savings Plan Deduction
Contributions to the DC College Savings Plan (the District’s 529) are deductible up to $4,000 per account owner per year. Spouses filing jointly can each claim $4,000 if each is an account owner. Contributions above the annual limit carry forward as a deduction for up to five years.5D.C. Law Library. District of Columbia Code – Chapter 45 – College Savings Program
Living in DC and Working in Maryland or Virginia
DC has reciprocal tax agreements with Maryland and Virginia. A DC resident who earns wages across the river owes income tax only to DC, not to the state where the job sits. The rule runs the other way as well: Maryland and Virginia residents who commute into DC are exempt from DC tax on those wages.
Where this breaks down is employer withholding. If the wrong jurisdiction has been withholding from your check, you’ll need to file a return in that state to get a refund; you cannot claim a credit on your DC return for tax that Maryland or Virginia should never have taken. Confirm the withholding state on file with your employer, especially with a new job.
Filing Your DC Return
DC residents file Form D-40, the individual income tax return. Because DC starts from federal adjusted gross income, your federal Form 1040 is the reference document. From there you apply DC-specific additions and subtractions to arrive at your local taxable income.
The fastest way to file is electronically through MyTax.DC.gov. You get immediate confirmation the Office of Tax and Revenue received your return, and refunds move faster. OTR posts downloadable forms on its website for taxpayers who prefer paper.6Office of Tax and Revenue. Individual Income Tax Forms
Deadline and Extensions
Tax year 2025 returns are due April 15, 2026. If April 15 falls on a weekend or legal holiday, the deadline shifts to the next business day.6Office of Tax and Revenue. Individual Income Tax Forms
Need more time? File Form FR-127 by April 15 for a six-month extension to October 15. If you’re living or traveling outside the United States, you can request an additional six months on top of that, up to a twelve-month total, but only if the first extension was filed on time.7MyTax DC. Instructions for Form FR-127
An extension buys time to file, not time to pay. Any balance owed is still due April 15, and interest accrues from that date whether or not the extension was granted.
Estimated Payments for Self-Employed Filers
If you expect to owe $100 or more in DC income tax after withholding and credits, you must make quarterly estimated payments using Form D-40ES.8Office of Tax and Revenue. 2026 D-40ES Estimated Payment for Individual Income Tax This mostly hits self-employed workers, freelancers, and anyone with sizable income that isn’t run through payroll withholding.
The 2026 quarterly due dates are April 15, 2026; June 15, 2026; September 15, 2026; and January 15, 2027. When a date lands on a weekend or holiday, the payment is due the next business day. You avoid underpayment interest if your total payments come to at least 90 percent of your 2026 liability or 110 percent of your 2025 DC tax for a twelve-month period.8Office of Tax and Revenue. 2026 D-40ES Estimated Payment for Individual Income Tax
What Happens If You File or Pay Late
DC assesses penalties and interest separately, and both can compound quickly.
The penalty for failing to file, or failing to pay on time, is 5 percent of the unpaid tax per month, capped at 25 percent.9D.C. Law Library. District of Columbia Code 47-4213 – Failure to File Return or to Pay Tax The 25 percent cap applies to each penalty separately, so a return that is both filed late and paid late can rack up penalties totaling 50 percent of the balance owed. OTR can waive the penalty for reasonable cause rather than willful neglect, but the standard is a high one.
On top of penalties, interest runs at 10 percent per year, compounded daily, on any tax not paid by the original due date.8Office of Tax and Revenue. 2026 D-40ES Estimated Payment for Individual Income Tax Interest accrues even with an approved filing extension. If money is tight, file on time and pay what you can. That alone stops the failure-to-file penalty from adding up while you sort out the rest.