D.C. Code § 47-3503

Current through codified legislation effective September 18, 2024

Section 47-3503 - [Effective 8/1/2024] Exemptions for qualifying lower income homeownership households and cooperative housing associations

(a)

(1) Deeds to property transferred to a qualifying lower income homeownership household shall be exempt from the deed recordation tax pursuant to § 42-1102, if it meets the requirements of § 47-3502.

(2) Deeds to property transferred to a cooperative housing association, as that term is defined in § 47-803(2), shall be exempt from the deed recordation tax pursuant to § 42-1102, if the cooperative housing association qualifies for the real property tax exemption pursuant to subsection (c) of this section or if a return under oath, certifying the association's intent to qualify for the real property tax exemption pursuant to subsection (c) of this section within 1 year, accompanies the deed at the time of its offer for recordation.

(3) Recordation of a construction loan deed of trust or mortgage, as that term is defined in § 42-1101(9), or a permanent loan deed of trust or mortgage, as that term is defined in § 42-1101(10), shall be exempt from the deed recordation tax pursuant to § 42-1102, if the property securing the deed of trust or mortgage is owned by or is being simultaneously transferred to a qualifying lower income homeownership household or a cooperative housing association qualified for the real property tax exemption pursuant to subsection (c) of this section or if a return under oath, certifying the association's intent to qualify for the real property tax exemption pursuant to subsection (c) of this section, within 1 year, accompanies the deed at the time of its offer for recordation.

(b)

(1) Transfers of property to a qualifying lower income homeownership household shall be exempt from the transfer tax pursuant to § 47-902, if:

(A) The household meets the requirements of § 47-3502; and

(B) The purchaser in fee simple or the persons acquiring qualified ownership interests under a shared equity financing agreement receive a credit against the purchase price of the property in an amount equal to the total tax which would have been due without regard to this section.

(2) Transfers of property to a cooperative housing association, as that term is defined in § 47-803(2), shall be exempt from the transfer tax pursuant to § 47-902, if:

(A) The cooperative housing association qualifies for the real property tax exemption pursuant to subsection (c) of this section or if a return under oath, certifying the association's intent to qualify for the real property tax exemption pursuant to subsection (c) of this section, within 1 year, accompanies the deed at the time of its offer for recordation; and

(B) The purchaser receives a credit against the purchase price of the property in an amount equal to the total tax that would have been due without regard to this paragraph.

(c)

(1) For the purposes of this subsection, the term:

(A) "Carrying charges" means the entire amount of money, money's worth, benefit, bonus, or gratuity demanded, received, or charged by a cooperative housing association to cover a proportionate share of operating and maintaining the cooperative, including such items as blanket mortgage payments, property taxes, management fees, maintenance costs, insurance premiums, utilities, and contributions to reserve funds.

(B) "Cooperative housing association" shall have the same meaning as in § 47-803(2).

(2) Property transferred to a qualifying lower income homeownership household shall be exempt from real property tax pursuant to § 47-1002, if:

(A) The household meets the requirements of § 47-3502; and

(B) In the case of a qualifying lower income homeownership household under § 47-3502(a)(2)(B), the household receives a credit against carrying charges equal to that percentage of the real property tax that would have been due on the property without regard to this section which bears the same relation to the total real property tax that would have been due on the property without regard to this section as 100% minus the percentage of the household's qualified ownership interest bears to 100%.

(3) The exemption provided by this subsection shall apply to property owned by a cooperative housing association if at least 50% of the dwelling units contained therein are occupied by households which meet the income limitations and conditions of transfer described in § 47-3502 and the credit against carrying charges requirement described in paragraph (2)(B) of this subsection.

(4) The exemption provided by this subsection shall be in effect only until the end of the fifth tax year following the year in which the property was transferred to the household and only so long as the same household is an owner and occupant of the property or in the case of a cooperative housing association, only so long as at least 50% of the dwelling units contained therein are occupied by households which meet the income limitations and conditions of transfer described in § 47-3502 and the credit against carrying charges requirement described in paragraph (2)(B) of this subsection

(4A) [Not funded.] Notwithstanding the provisions of paragraph (4) of this subsection, the exemption provided by this subsection shall apply to property owned by a limited-equity cooperative defined in § 47-802(11) and shall not expire; provided, that:

(A) At least 50% of the dwelling units are occupied by households whose household income does not exceed 80% of the lower income guidelines established pursuant to section 8 of the United States Housing Act of 1937, approved August 22, 1974 (88 Stat. 662; 42 U.S.C. § 1437f), for the Washington Standard Metropolitan Statistical Area, as the median is determined by the United States Department of Housing and Urban Development and adjusted yearly by historic trends of that median, and as further may be adjusted by an interim census of District incomes by local or regional government agencies;

(B) The conditions described in § 47-3502 and the credit against carrying charges requirement described in paragraph (2)(B) of this subsection are met; and

(C) The limited-equity cooperative files the report required by § 47-1007.

(5)

(A) A real property receiving the exemption under this subsection shall be deemed to be receiving the homestead deduction under § 47-850 or § 47-850.01 for purposes of § 47-864; provided, that there is an approved and current homestead application on file applicable to the entire tax year following the expiration of the exemption.

(B) The application of subparagraph (A) of this paragraph shall be limited as follows:

(i) The credit under § 47-864 that may result for the tax year beginning October 1, 2006 shall be nonrefundable and shall be applied to the real property tax owed for the tax year beginning October 1, 2007, and thereafter.

(ii) No credit under § 47-864 shall be allowed for a tax year prior to the tax year beginning October 1, 2006.

(iii) Subparagraph (A) of this paragraph shall not apply if the ownership has not been continuous from the date that the exemption provided by this subsection has been validly in effect.

D.C. Code § 47-3503

Amended by D.C. Law 25-95,§ 2, 70 DCR 014508, eff. 12/20/2023, exp. 8/1/2024.

Amended by D.C. Law 25-236, § 2, 70 DCR 013792, eff. 10/11/2023, exp. 1/9/2024.

Amended by D.C. Law 24-272, § 2 , 69 DCR 014760, eff. 2/23/2023, exp. 10/6/2023.

Amended by D.C. Law 24-244, § 2 , 69 DCR 015094, eff. 2/23/2023.

Amended by D.C. Law 24-636, § 2 , 0 DCR 0, eff. 11/3/2022, exp. 2/1/2023.

Oct. 8, 1983, D.C. Law 5-31, § 4, 30 DCR 3879; Mar. 16, 1989, D.C. Law 7-205, § 3(a), 36 DCR 457; enacted, Apr. 9, 1997, D.C. Law 11-254, § 2, 44 DCR 1575; Mar. 2, 2007, D.C. Law 16-192, § 1102, 53 DCR 6899; July 18, 2008, D.C. Law 17-180, § 2, 55 DCR 6255.

Section 3 of D.C. Law 17-180 provided: "Sec. 3. Applicability. This act shall apply upon the inclusion of its fiscal effect in an approved budget and financial plan."

Section 7022 of D.C. Law 18-111 repealed section 3 of D.C. Law 17-180.

Exemptions granted to Sursum Corda Cooperative Association, Inc: D.C. Law 9-20, effective August 17, 1991, temporarily clarified that the Sursum Corda Cooperative Association, Inc., qualifies as a cooperative housing association for the exemption from deed recordation, transfer, and real property taxes, and provided the Sursum Corda Cooperative Association, Inc., with equitable relief from water and sewer service charges. Section 4(b) of D.C. Law 9-20 provided that the act shall expire on the 225th day of its having taken effect or upon the date of the Sursum Corda Cooperative Association, Inc. Act of 1991, whichever occurs first.

D.C. Law 9-60, effective Mar. 7, 1992, the Sursum Corda Cooperative Association, Inc., Clarification Act of 1991, clarified that the Sursum Corda Cooperative Association, Inc., qualifies as a cooperative housing association for the exemption from deed recordation, transfer, and real property taxes, and provided the Sursum Corda Cooperative Association, Inc., with equitable relief from water and sewer service charges.

This section is set out more than once due to postponed, multiple, or conflicting amendments.

Deeds, recordation tax, exempt deeds, see § 42-1102 . Real property assessment and tax, additional definitions, see § 47-803 . Real property exempt from taxation, enumerated, see § 47-1002 . Real property transfer tax, exempt transfers, see § 47-902 . .