DC Tax Abatement Income, Purchase Price Thresholds Increase
Visit our DC Tax Abatement program guide for the most up-to-date information.
The new fiscal year in the District of Columbia began October 1, which means the Office and Tax Revenue has published a revised guide of the DC Tax Abatement program.
Officially known as the Lower Income Homeowner Exemption Program, DC Tax Abatement delivers a large tax savings to first-time homebuyers who qualify. First, buyers are exempt from paying their share of recordation taxes at closing, which depending on purchase price is either 1.1% or 1.45% of the purchase price. In addition, the buyers receive an allowable credit of the seller’s transfer tax for another 1.1% or 1.45% depending on the purchase price.
What’s more, the buyers will be exempt from paying property taxes for the first five years of ownership, provided their income continues to qualify and the property remains their primary residence.
The purchase price threshold has increased from $479,066 to $484,000. Meanwhile, the income threshold increased from $65,220 to $66,900 for individuals and from $74,520 to $76,440 for couples.