DC First-Time Buyer Reduced Recordation Tax Updates

DC just released FY 2025’s new effective purchase price ceiling and household income limits eligibility for Reduced Recordation Tax Rates for First-Time DC Homebuyers! As a reminder, a buyer who meet’s DC’s definition & eligibility requirements as a first-time buyer will have their recordation tax reduced to 0.725%.

Effective since October 1^st, 2024: ROD-11 FORM

• the purchase price ceiling has increased from $730,000 to $753,000
• household Income limits have increased:
• Persons 1 | from $189,900 to $194,940
• Persons 2 | from $217,080 to $222,840       

More Important Changes to DC tax laws can be found here, and highlighted below pertaining to real property tax classification & assessment rates, along with estate tax exclusion changes.

Real Property Tax:

• Real Property Tax Amendment Act of 2024: As of October 1, 2024, residential real property previously classified as Class 1 will now be classified as either Class 1A or Class 1B. Class 1A property is any non-transient, residential property that is not included in the definition of Class 1B property. Class 1B property is non-transient residential property with no more than two dwelling units. It includes mostly single-family homes, properties receiving the senior/disabled tax relief, and up to two contiguous condominium units with common ownership. (Short-term, licensed rentals of such properties do not affect their Class 1A or Class 1B status.) The rate structure for Class 1A and Class 1B property is as follows:

Additional Changes Effective January 1, 2025

Estate Tax:

• For estates of decedents who die on or after January 1, 2025, and on or before December 31, 2025, the exclusion (zero bracket) amount is increased to $4,873,200.00.

For additional information, contact OTR’s Customer Service Center at (202) 727-4TAX (4829).