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D.C. Office of Tax and Revenue Delays Hotels and Motels Real Property Tax Payments for “First Half 2020” in Response to COVID-19

Similar to the rest of the District of Columbia government, the District’s Office of Tax and Revenue (OTR) has made changes and extended deadlines for certain real property and business sales and use tax filings this year. As a general matter, all OTR walk-in centers are closed and its building at 1101 4th Street SW is inaccessible. All staff are working remotely and taxpayers are encouraged to pay taxes either online or via mail. Also, Wells Fargo has closed many of its braches where real property taxes could have been paid in person. 

There are two notable updates to D.C. Real Property payments as a result of the COVID-19 emergency affecting property owners.

1. Real property taxes are due today, March 31, 2020, for all real property with the exception of hotels and motels

Importantly, the deadline for payment of the “2020 First Half” property taxes for real property [except for hotels and motels discussed below] has not changed and remains due March 31, 2020 (today). Therefore, for all real property not deemed a “hotel” or “motel”—payment of “2020 First Half” real property taxes, including Business Improvement District (BID) taxes—is due today, March 31, 2020. 

OTR extended the date for property owners to file tax appeals to April 30, 2020. This 30-day extension gives property owners additional time to file an appeal if they believe their proposed 2021 assessment does not reflect the market value of their property.

2. Real property taxes on hotels and motels delayed to June 30, 2020

Recognizing the impact that the coronavirus emergency will have on the hospitality industry, the D.C. Council’s March 17 COVID-19 Response Emergency Act of 2020 extended the due date for “2020 First Half” real property taxes for hotels and motels to June 30, 2020. This should also apply to BID taxes on hotels and motels located in BIDs.

OTR Tax Notice 2020-01 defines “the terms ‘hotel’ and ‘motel’ to mean a real property any part of which is classified for tax year 2020 as Class 2 Property under § 47-813, [and] is commercially improved and occupied, and is a hotel, motel, inn, or other place which is regularly used for the purpose of furnishing rooms, lodgings, or accommodations to transients.”

Payment of all real estate taxes for hotels and motels is not due until June 30, 2020. In his March 17, 2020, “Chairman’s Update,” D.C. Council Chairman Phil Mendelson said that the hotel/motel real estate payment delay “is not an abatement of taxes, but it is, in essence, a short-term interest-free loan to businesses totaling about $266 million. We looked at larger or longer tax deferment and did not go further because of the District government’s need for liquidity.”

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