Upping the ante on D.C. vacant property taxes

Written by Federal Title | 28 July 2010

The District of Columbia is currently in a very aggressive posture regarding collection of revenue from real property taxes and assessments, including vacant properties. Properties may be reclassified as “vacant” or “blighted” retroactively, resulting in enormous real property tax liabilities, as these properties are taxed at the rate of $10 per $100 of assessed value.

There has been a never-ending stream of legislation changing the laws regarding the tax rate for vacant property, as D.C. balances its need for cash against the outraged cries of property owners required to pay a truly exorbitant tax rate of $10 for every $100 of assessed value for certain vacant properties.

In the latest change to the vacant property tax laws, D.C. will go to four real property tax classifications, effective October 10, 2010:

• -Class 1: Occupied residential property and certain vacant land located in residential zones;

• -Class 2: All property which is not Class 1, 3 or 4; usually commercial property;

• -Class 3: Vacant property which is not “blighted”, taxed at $5/$100 of assessed value. Vacant building owners are exempt from paying the Class 3 property tax rate if the property is for sale or rent, subject to probate proceedings, under active construction or rehab or there is a pending application for an administrative predevelopment proceeding.

• -Class 4: Blighted buildings, deemed to be unsafe or unsanitary by DCRA, and taxed at $10/$100 of assessed value.