CPA Firm in Washington, DC

DC Business Tax Rules to Know

Businesses with DC-source income or a DC location deal with the District’s Office of Tax and Revenue (OTR) and its own set of filings. The main ones are:

• Franchise tax: corporations file a DC corporation franchise tax return, and unincorporated businesses file an unincorporated business franchise tax return. The rate has been 8.25% for recent tax years, with a minimum tax of $250 when DC gross receipts are $1 million or less and $1,000 above that. Calendar-year returns are generally due April 15.
• Business personal property: an annual return for tangible personal property used in a DC business is due July 31. No tax is due when the value is $225,000 or less, but the return still has to be filed.
• Business license: most businesses operating in DC need a Basic Business License from the Department of Licensing and Consumer Protection, and getting or renewing it requires a Certificate of Clean Hands, which confirms you do not owe the District more than $100.

Rules, rates and thresholds change, and what applies depends on how your business is organized and how much of your income comes from DC. We help clients work out which DC filings apply to them, prepare them, and keep track of the dates each year.

Washington, DC CPA Questions

Do you work with DC businesses even though your office is in Virginia?

Yes. We serve businesses across the Washington, DC region, including the District, from our office in Fairfax. Call us and we will talk through how we would work together.

Does my business need to file a DC franchise tax return?

It depends on how your business is organized and how much of its income comes from DC. Corporations with DC income and unincorporated businesses with DC gross income above $12,000 generally have to file. We can review your situation and tell you what applies.

When is the DC business personal property tax return due?

The return is due July 31 each year. No tax is due if the value of your property is $225,000 or less, but you still need to file.

What is a Certificate of Clean Hands?

It is a document from the DC Office of Tax and Revenue showing that a business does not owe the District more than $100 in taxes, fines, fees or penalties. It is required when applying for or renewing a DC business license.

What is the difference between a bookkeeper, a CPA and an outsourced CFO?

A bookkeeper records transactions and keeps accounts reconciled day to day. A CPA prepares tax returns, reviews the numbers and advises on compliance and tax strategy. An outsourced CFO looks forward, using budgets, forecasts and cash flow analysis to guide decisions such as hiring, financing and growth.

How do I get started?

Call us or send a message. We start with a conversation about your business and what you need, then recommend the right mix of services.