Homestead Deduction

This deduction reduces your real property's assessed value by $38,000 prior to computing the yearly tax liability. The homestead deduction is limited to residential property. To qualify:

1. An application must be on file with the Office of Tax and Revenue;
2. The property must be occupied by the owner/applicant and contain no more than 5 dwelling units (including the unit occupied by the owner);
3. The property must be the principal residence (domicile) of the owner/applicant.

In the case of a cooperative housing association, the unit must be occupied by the shareholder (or member) as his/her principal residence (domicile), and the deduction is granted to the cooperative (which will supply and collect the applications).

In the case of property transferred to a trust, the property may qualify for the homestead deduction if:

• The property was eligible for the homestead deduction before the transfer;
• The property is transferred to a revocable trust;
• The transfer is not for money (or other consideration);
• The property remains the principal place of residence of the applicant//transferor/trustor before and after the transfer.

If a properly completed and approved application is filed from October 1 to March 31, the property will receive the deduction for the entire tax year (and for all tax years in the future). If a properly completed and approved application is filed from April 1 to September 30, the property will receive one-half of the deduction reflected on the second installment (and full deductions for all tax years in the future).

Properties will continue to receive Homestead Deduction tax relief as long as there is no change in eligibility, such as property ownership or owner-occupancy status. The Office of Tax and Revenue will conduct periodic verification and compliance checks. Owners of properties receiving the tax benefits are responsible for notifying the agency when eligibility ceases. Written notice must be sent within 30 days of a change in ownership or owner-occupancy status. Please send written notice, including the square and lot of the property, to:

Office of Tax and Revenue
Real Property Tax Administration
941 North Capitol Street, NE, 4th Floor
Washington, DC 20002
(202) 727-4TAX

• Homestead/Senior Citizen Tax Relief Confirmations