When used in this chapter, unless otherwise required by the context:
(1) The word “District” means the District of Columbia.
(2) The word “Mayor” means the Mayor of the District of Columbia, or his duly authorized agents or representatives.
(3)(A) The word “deed” means any document, instrument, or writing, including a security interest instrument, wherever made, executed, or delivered, pursuant to which:
(i) Title to real property is conveyed, vested, granted, bargained, sold, transferred, or assigned;
(ii) An interest in real property (including an estate for life) is conveyed, vested, granted, bargained, sold, transferred, or assigned;
(iii) A security interest in real property is conveyed, vested, granted, bargained, sold, transferred, or assigned; or
(iv) A transfer of an economic interest in real property is evidenced pursuant to § 42-1102.02.
(B) The word “deed” shall not include a will or a lease or ground rent for a term (with renewals) that is less than 30 years.
(4) The words “real property” mean every estate or right, legal or equitable, present or future, vested or contingent in lands, tenements, or hereditaments located in whole or in part within the District.
(5) The word “consideration,” except as otherwise provided in § 42-1104, means the price or amount actually paid, or required to be paid, for real property including any mortgages, liens, encumbrances thereon, construction loan deeds of trust or mortgages or permanent loan deeds of trust or mortgages.
(6) The word “person” means an individual, partnership, society, association, joint-stock company, corporation, estate, receiver, trustee, assignee, any individual acting in a fiduciary or representative capacity, whether appointed by a court or otherwise, any combination of individuals, and any other form of unincorporated enterprise owned or conducted by 2 or more persons.
(7) The word “deficiency” as used in this chapter means the amount or amounts by which the tax imposed by this chapter as determined by the Mayor exceeds the amount shown as the tax upon the return of the person or persons liable for the payment thereof.
(8) The word “taxpayer” means any person required by this chapter to pay a tax, or file a return.
(9) The words “construction loan deed of trust or mortgage” mean a deed of trust or mortgage upon real estate which is given to secure a loan for new real estate construction.
(10) The words “permanent loan deed of trust or mortgage” mean a deed of trust or mortgage upon real estate which secures an instrument made by the same obligors who made the instrument which the construction loan deed of trust or mortgage secured, and which conveys substantially the same real estate.
(11) The phrase “controlling interest” means:
(A) More than 50% of the total voting power of all classes of stock of a corporation or more than 50% of the total fair market value of all classes of stock of a corporation;
(B) More than 50% of the capital or profits in a partnership, association, or other unincorporated entity; or
(C) More than 50% of the beneficial interests in a trust.
(12) The phrase “purchase money mortgage or purchase money deed of trust” means a mortgage or deed of trust provided as payment or part payment of the purchase price of real property.
(13) The phrase “security interest” means any interest in real property acquired for the purpose of securing payment of a debt.
(14) The phrase “security interest instrument” means any instrument which conveys, vests, grants, transfers, bargains, sells, or assigns a security interest in real property. A security interest instrument may include the following:
(A) A mortgage;
(B) A deed of trust;
(C) A financing statement;
(D) A refinancing statement; or
(E) Another document, instrument, or writing which creates an encumbrance on real property.
(15) The phrase “supplemental deed” means a deed that confirms, corrects, modifies, or supplements a prior recorded deed without additional consideration.
(16) The phrase "first-time District homebuyer" means an individual purchaser who has never owned improved residential real property or an economic interest in a cooperative unit that qualified for the homestead deduction provided pursuant to § 47-850 or § 47-850.01 as the individual's principal residence. The term "first-time District homebuyer" includes an individual who has divorced or separated and who, by a written settlement agreement or court order, did not obtain an ownership interest in a principal residence that had been jointly owned.
(17) The phrase "eligible property" means improved residential real property, including an economic interest in a cooperative unit, purchased at an amount not to exceed the purchase ceiling of $625,000 (adjusted annually beginning with real property tax year 2019 by the addition to the prior purchase ceiling of an amount equal to the percentage increase in the Washington, D.C., Standard Metropolitan Statistical Area Consumer Price Index for All Urban Consumers for the preceding calendar year in which the real property tax year begins, rounded to the next lowest multiple of $500), that qualifies for the homestead deduction provided pursuant to § 47-850 or § 47-850.01; and the phrase also includes within the purchase ceiling all other real property conveyed on the same deed.
§ 42–1102. Deeds exempt from tax.
The following deeds shall be exempt from the tax imposed by this chapter:
(1) Repealed;
(2) Deeds to property acquired by the United States of America or the District of Columbia, unless its taxation has been authorized by Congress;
(3) Deeds to real property acquired by an institution, organization, corporation, or government entitled to exemption from real property taxation under § 47-1002 (or exempt from recordation taxes under a law of the United States of America or the District of Columbia); provided, that, unless waived by regulation, a copy of a filed real property tax exemption application accompanies the deed at the time of recordation; provided further, that this exemption shall not apply to property which is exempt under § 47-1002(29) or § 47-1002(30);
(4) Deeds to property acquired by an institution, organization, corporation, or association entitled to exemption from real property taxation by special act of Congress, which property was acquired solely for a purpose or purposes for which such special exemption was granted; provided, that a return, under oath, showing the purpose or purposes for which such property was acquired, shall accompany the deed at the time of its offer for recordation;
(5) A purchase money mortgage or purchase money deed of trust that is recorded simultaneously with the deed conveying the real property for which the purchase money mortgage or purchase money deed of trust was obtained;
(6) Supplemental deeds;
(7) Deeds between spouses, parent and child, grandparent and grandchild, or domestic partners, as defined in § 32-701(3), without actual consideration therefor;
(8) Tax deeds;
(9) Deeds of release of property which is security for a debt or other obligation;
(10) Deeds of personal representatives of decedents, acting under the provisions of Title 20, transferring to a distributee, without additional consideration, real property of a decedent or a life estate in the real property;
(11) When a permanent loan deed of trust or mortgage is submitted for recordation and the tax on the construction loan deed of trust or mortgage has been timely and properly paid, no additional tax liability arises under § 42-1103, except where the amount of the obligor’s liability secured by the permanent loan deed of trust or mortgage exceeds the amount of his liability secured by the construction loan deed of trust or mortgage, in which case the tax shall be calculated only on the amount of such difference; provided, however, that such permanent loan deed of trust or mortgage shall contain a reference to the construction loan deed of trust or mortgage and the date and instrument number where it is recorded;
(12) Deeds to property transferred to a qualifying lower income homeownership household in accordance with § 47-3503(a);
(13) Deeds to property transferred to a qualifying nonprofit housing organization in accordance with § 47-3505(c);
(14) Deeds to property transferred to a cooperative housing association in accordance with § 47-3503(a)(2);
(15) Construction loan deeds of trust or mortgages or permanent loan deeds of trust or mortgages in accordance with § 47-3503(a)(3);
(16) Repealed.
(17) A deed by a transferor that conveys bare legal title to the trustee of a revocable trust, without consideration for the transfer, where the transferor is the beneficiary of the trust;
(18) A deed to property transferred to a beneficiary of a revocable trust as the result of the death of the grantor of the revocable trust;
(19) A deed to property transferred by the trustee of a revocable trust if the transfer would otherwise be exempt under this section if made by the grantor of the revocable trust;
(20) A deed to property transferred to a resident management corporation in accordance with § 47-3506.01;
(21) A security interest instrument in Class 1 Property, as that class of property is established pursuant to § 47-813, that contains no more than 5 dwelling units. Each security interest instrument submitted for recordation for which an exemption under this paragraph is claimed shall have affixed thereto an affidavit stating the following:
“I (we) the owner(s) of the real property described within certify, subject to criminal penalties for making false statements pursuant to § 22-2405 of the District of Columbia Code , that the real property described within is Class 1 Property, as that class of property is established pursuant to § 47-813, with 5 or fewer units.”;
(22)(A) A deed to property transferred pursuant to § 29-204.06;
(B) In order for limited liability companies to receive the exemption provided in subparagraph (A) of this paragraph, the Recorder of Deeds shall be notified, within 30 days, of any change to the members or interests in profits and losses during the 12-month period following the effective date of the conversion so that the applicable recordation tax can be imposed;
(C) Violation of the provisions of subparagraph (B) of this paragraph shall be punishable pursuant to § 42-1120 [repealed];
(23) A deed for the improvements known as the District of Columbia Correctional Treatment Facility, located on a portion of Lot 800 of Square 1112E, with a street address of 1901 E Street, S.E.;
(24)(A) Deeds conveying, vesting, granting, or assigning title to, an interest in, a security interest in, or an economic interest in the real property (and any improvements thereon) described as Square 454, Lots 41, 824, 838, 857, 877, 878; the portion of the public alley that reverted to (i) former Lot 820, (which is currently known as Lot 866), and (ii) former Lot 821 (which is currently known as Lot 867) pursuant to the Plat of Alley Closing filed with the Surveyor of the District of Columbia in Liber 17 at folio 74; and the portions of the public alley that will revert to Lots 41, 824, 838, 857, 877 and 878, all in Square 454, pursuant to the alley closing approved by the Closing of Public Alleys in Square 454 and Square 455, S.O. 98-194 Act of 1999, effective October 22, 1999 (D.C. Law 13-48; 46 DCR 6768);
(B) The amount of all taxes, fees, and deposits exempt, abated, or waived under this paragraph, § 2-1217.31(b), and §§ 47-902(17), 47-1002(26), and 47-2005(32) [(32) repealed], shall not exceed, in the aggregate, $ 7 million;
(25)(A) Deeds conveying, vesting, granting, or assigning title to, an interest in, a security interest in, or an economic interest in the real property (and any improvements thereon) described as Square 299, Lot 831, in connection with debt or equity financing for the Mandarin Oriental Hotel Project until the Development Sponsor sells the Mandarin Oriental Hotel Project, as evidenced by the recordation of a deed conveying title to Square 299, Lot 831, at which time such amounts shall be due and payable without penalty or interest;
(B) The amount of all taxes, fees, and deposits deferred under this paragraph, and §§ 2-1217.32(b), 47-902(19), 47-1002(27), and 47-2005(34), shall not exceed, in the aggregate, $4 million;
(C) For purposes of this paragraph, the term:
(i) “Development Sponsor” means Portals Hotel Site, LLC, a Delaware limited liability company, and its successors and assigns;
(ii) “Mandarin Oriental Hotel Project” means the acquisition and initial development, construction, equipping, and furnishing of a Mandarin Oriental hotel within the Portals project, located on Square 299, Lot 831, consisting of a 400-room hotel with approximately 33,000 square feet of associated meeting and banquet space, 2 restaurants, a health spa and fitness center totaling approximately 10,000 square feet, and approximately 90,000 square feet of public parking space for approximately 200 cars;
(iii) “Mandarin TIF Bonds” means the tax increment financing bonds issued in connection with the Mandarin Oriental Hotel Project pursuant to the Tax Increment Revenue Bonds Mandarin Hotel Project Emergency Approval Resolution of 2000, effective March 7, 2000 (Res. 13-510; 47 DCR 2133), and the Mandarin Hotel Project Modification Approval Resolution of 2000, effective December 19, 2000 (Res. 13-745; 48 DCR 83);
(D) This paragraph shall apply upon the closing of the sale of the Mandarin TIF Bonds;
(26) Deeds executed pursuant to a decree of divorce or of separate maintenance or pursuant to a written instrument incident to such divorce or separation;
(27) Deeds to an entity described in paragraph (3) of this section of a lease or ground rent for a term, including renewals, that is at least 30 years; provided, that if the entity were the owner of the real property in which the possessory interest is conveyed, the real property would have been entitled to exemption from real property taxation under § 47-1002; provided further, that, unless waived by regulation, a copy of a filed real property tax exemption application accompanies the deed at the time of its offer for recordation;
(28)(A) A deed to residential real property, without consideration for the transfer, to the trustee of a special needs trust established for the benefit of a trust beneficiary who has a disability, as defined in § 1614(a)(3) of the Social Security Act, approved October 30, 1972 (86 Stat. 1471; 42 U.S.C. § 1382c(a)(3)), or from the trustee of a special needs trust that, by its terms, terminates upon the death of the trust beneficiary with a disability.
(B) For the purposes of subparagraph (A) of this paragraph, a trust is a special needs trust if the trust instrument:
(i) States, among its purposes, that the trust assets are not intended to be counted in determining the beneficiary’s eligibility for needs-based governmental benefits; and
(ii)(I) Names the beneficiary with a disability as the sole trust beneficiary during his or her lifetime; and
(II) Provides that the beneficiary with a disability shall not serve as trustee;
(29) A security interest instrument securing a credit enhancement, such as a letter of credit, issued by a for-profit business organization, where such credit enhancement is required in connection with affordable housing financing provided by the District of Columbia Housing Finance Agency that is funded in whole or in part through bonds issued pursuant to the U.S. Department of Treasury’s New Issue Bond Program. This paragraph shall apply as of January 1, 2009;
(30) Beginning October 1, 2009, a security interest instrument pertaining to a cooperative housing association;
(31) Beginning October 1, 2009, a deed of economic interest pertaining to a limited-equity cooperative, as defined under § 47-802(11);
(32) A deed of title or a security interest instrument as to which the Mayor has issued a valid certification of exemption pursuant to § 47-1005.02 as to both the property conveyed or encumbered and the grantee of the deed of title or the grantor of the security interest; provided, that, unless waived by regulation, to claim an exemption a copy of the certification of exemption shall accompany the deed of title or security interest instrument at the time it is submitted for recordation;
(33) A security interest instrument executed by a borrower in connection with a loan under the Industrial Revenue Bond Forward Commitment Program authorized by subchapter II-B of Chapter 3 of Title 47 [§ 47–340.01 et seq.]; provided, that unless waived by regulation, a certification by the Mayor that the security interest instrument is entitled to this exemption accompanies the security interest instrument at the time it is presented for recordation;
(34) Deeds to property transferred to a named beneficiary of a revocable transfer on death deed under subchapter IV of Chapter 6 of Title 19 [§ 19-604.01 et seq.], by reason of the death of the grantor of the revocable transfer on death deed;
(35) Deeds to property transferred between the electric company and the District pursuant to § 34-1313.11(c); and
(36)(A) Deeds conveying, vesting, granting, or assigning title to, an interest in, a security interest in, or an economic interest in the real property (and any improvements thereon) described as Square 5633, Lots 802, 803, 804, 805, 806, 807, 808, 809, 810, 811, 812, 813, 814, 815, 816, 817, 818, 822, 823, 824, 825, 826, 827, 828, 829, 830, 831, 7000, 7009, and 7010 that are recorded between October 1, 2020, and December 31, 2020.
(B) The amount of all taxes, fees, and deposits exempted under this paragraph and § 47-902(28), shall not exceed, in the aggregate, $420,840.
§ 42–1102.01. Sales or assignments of instruments on secondary market exempt from tax.
A sale or assignment of a note, mortgage, deed of trust, or other instrument from one lender to another, on the secondary market, where there are no changes in the terms or conditions provided in the instrument and the borrower has taken no action to refinance, shall be exempt from the tax imposed by this chapter.
§ 42–1102.02. Transfer of economic interest defined.
(a) A transfer of an economic interest in real property occurs upon the conveyance, vesting, granting, bargaining, sale, or assignment, directly or indirectly, of a controlling interest by 1 or more persons or by 1 or more transactions, within any 12-month period, in any corporation, partnership, association, trust, or other entity that, during the 12-month period immediately preceding the transfer of an economic interest in real property:
(1) Derives more than 50% of its gross receipts from the ownership or disposition of real property in the District; or
(2) Holds real property in the District that has a value comprising 80% or more of the value of its entire tangible asset holdings.
(b) For the purposes of subsection (a) of this section, a transfer of a controlling interest includes the aggregate of the transfer of any legal, equitable, beneficial, or other ownership interest in:
(1) Any entity described in subsection (a) of this section;
(2) Any entity that is a partner in, shareholder in, or beneficiary of, an entity described in subsection (a) of this section; and
(3) Any other entity:
(A) That derives, directly or indirectly, any portion of its receipts from the ownership of any entity described in subsection (a) of this section; or
(B) Has asset value that includes, directly or indirectly, any legal, equitable, beneficial, or other ownership interest in any entity described in subsection (a) of this section.
(c) Notwithstanding any other provision of this section, as of October 1, 2009, every transfer of an interest in a cooperative housing association in connection with the grant, transfer, or assignment of a proprietary leasehold or other proprietary interest, in whole or in part, shall be a transfer of an economic interest.
§ 42–1103. Imposition of tax; rate; return; contents; liability for tax; extension of period for filing, and waiver of, return.
(a)(1) At the time a deed, including a lease or ground rent for a term (with renewals) that is at least 30 years, is submitted for recordation, it shall be taxed at the rate of 1.1% (to complete the calculation of total recordation tax due at time of recording, see also additional tax in subsections (a-4) and (a-5) of this section), as follows:
(A) A deed that conveys title to real property in the District shall be taxed at a rate of 1.1% (to complete the calculation of total recordation tax due at time of recording, see also additional tax in subsections (a-4) and (a-5) of this section) applied to the consideration for the deed; provided, that if there is no consideration for a transfer or if the consideration for the transfer is nominal, the rate shall be applied to the fair market value of the real property, as determined by the Mayor.
(B)(i) If there is a lease or ground rent for a term (with renewals) that is at least 30 years, the recordation tax shall be based upon the average annual rent over the term of the lease, including renewals, capitalized at a rate of 10%, plus any additional consideration payable; provided that the amount to which the rate is applied shall not exceed the fair market value of the real property covered by the interest transferred.
(ii) If the average annual rent of the lease or ground rent for a term (including renewals) that is at least 30 years cannot be determined, the recordation tax will be based on the greater of:
(I) One hundred and five percent of the minimum average annual rent ascertainable from the terms of the lease, capitalized at a rate of 10%, plus any additional consideration payable; or
(II) One hundred and fifty percent of the assessed value of the real property covered by the interest transferred.
(iii) If there is no consideration for a lease or ground rent or the consideration is nominal, the rate of tax shall be applied to the fair market value of the real property covered by the lease or ground rent, as determined by the Mayor.
(2) Notwithstanding paragraph (1) of this subsection, at the time it is submitted for recordation, a deed that evidences a transfer of an economic interest in real property shall be taxed at the rate of 2.9% of the consideration allocable to the real property; provided, that, beginning October 1, 2009, in the case of a transfer of an economic interest in a cooperative housing association that is in connection with a grant, transfer, or assignment of a proprietary leasehold or other proprietary interest where the consideration allocable to the real property is less than $400,000, the rate of tax shall be 2.2%; provided further, that, beginning October 1, 2019, at the time it is submitted for recordation, a deed that evidences a transfer of an economic interest in real property any part of which is classified as Class 2 Property under § 47-813 (except for a deed solely transferring an economic interest relating to a residential unit within a cooperative housing association), shall be taxed at the rate of 5.0% of the consideration allocable to the real property if the value of the consideration allocable to the real property is $2 million or more; provided further, that for the purposes of the foregoing provision, a deed shall be considered to evidence a transfer of an economic interest in Class 2 Property if any portion of the building or structure in which the interest in real property being transferred by the deed is located is classified as Class 2 Property, regardless of whether that portion is transferred in the deed, if, prior to the execution of the deed, the majority ownership of the economic interest being transferred by the deed and a portion of the building or structure that is classified as Class 2 Property was common (whether direct or indirect).
(3)(A) Notwithstanding paragraph (1) of this subsection, at the time a security interest instrument is submitted for recordation, it shall be taxed at a rate of 1.1% (to complete the calculation of total recordation tax due at time of recording, see also additional tax in subsections (a-4) and (a-5) of this section) of the total amount of debt incurred that is secured by the interest in real property; provided, that if the existing debt is refinanced, the rate shall be applied only to the principal amount of the new debt in excess of the principal balance due on the existing debt to the extent that such existing debt (including any prior debt that was previously refinanced by the existing debt) was:
(i) Previously taxable under this paragraph and the tax thereon was timely and properly paid; or
(ii) Exempt under § 42-1102 or not otherwise taxable, including purchase money mortgages described in § 42-1102(5).
(B) Any amendment, modification, or restatement of a security interest instrument shall be deemed a refinance of the entire aggregate debt owed, unless the amendment, modification, or restatement is a supplemental deed. With such a deemed refinance, the rate in subparagraph (A) of this paragraph shall be applied only to the principal amount of the modified debt (including amounts paid to the borrower on the existing security interest instrument during the preceding 12 months) in excess of the principal balance due on the existing debt (before any such payment) to the extent that the existing debt (including any prior debt that was previously refinanced by the existing debt) was:
(i) Previously taxable under this paragraph and the tax thereon was timely and properly paid; or
(ii) Exempt under § 42-1102 or not otherwise taxable, including purchase money mortgages described in § 42-1102(5).
(4) Security interest instruments that qualify for exemption under § 42-1102 shall be exempt from the recordation tax.
(a-1) Repealed.
(a-2) Repealed.
(a-3) Repealed.
(a-4) Beginning October 1, 2006, except for residential properties transferred by deed of title for a consideration less than $400,000, an additional tax of .35% is imposed upon a deed that is subject to the tax under subsection (a)(1) of this section.
(a-5)(1) Beginning October 1, 2019, an additional tax of 1.05%, in addition to the additional tax imposed by subsection (a-4) of this section, is imposed upon a:
(A) Deed that is subject to the tax under subsection (a)(1) of this section if:
(i) The deed transfers real property (or an interest in real property) any part of which is classified as Class 2 Property under § 47-813; and
(ii) The taxed or imputed consideration for the deed is $2 million or more.
(B)(i) Security interest instrument that is subject to the tax under subsection (a)(3) of this section if the security interest instrument:
(I) Encumbers real property any part of which is classified as Class 2 Property under § 47-813; and
(II) Secures a debt of $2,000,000 or greater and only to the extent any part thereof exceeds an exemption from taxation under this chapter.
(ii) For the purposes of this subparagraph, debts in security interest instruments recorded on the same day and pertaining to the same real property shall be aggregated to determine whether the $2,000,000 threshold has been met; in the case in which such threshold is met, the tax under this subsection shall apply to each such security interest instrument regardless of the amount of debt secured by such security interest instrument.
(2) For the purposes of this subsection, a deed shall be considered to transfer Class 2 Property and a security interest instrument shall be considered to encumber Class 2 Property if any portion of the building or structure in which the real property (or interest in real property) being transferred by the deed or encumbered by the security interest instrument is classified as Class 2 Property, regardless of whether that portion is transferred in the deed or encumbered by the security interest instrument, if, prior to execution of the deed or security interest instrument, the majority ownership of the real property (or interest in real property) being transferred by the deed or encumbered by the security interest instrument and a portion of the building or structure that is classified as Class 2 Property was common (whether direct or indirect); provided, that this paragraph shall not apply to a deed solely transferring real property for which the homestead deduction is applied for under § 47-850, if the homestead deduction is applied for simultaneously with the recordation of the deed and the deduction is granted or to an accessory lot included within such deed.
(b)(1) Each such deed shall be accompanied by a return in such form as the Mayor may prescribe, executed by all parties to the deed, setting forth the consideration for the deed or debt secured by the deed, and such other information as the Mayor may require.
(2) The return shall be an integral part of the deed when prescribed and as required by regulation.
(3) The return shall not be confidential or subject to the provisions of §§ 47-1805.04 and 47-4406, unless otherwise provided by regulation.
(b-1)(1) A purchase money mortgage or purchase money deed of trust shall:
(A) Be fully executed within 30 days of the date that the deed conveying title to the real property to the purchaser is fully executed; and
(B) Be recorded within 30 days after the date that the deed conveying title to the purchaser of the real property is duly recorded.
(2) A purchase money mortgage or purchase money deed of trust submitted to the Mayor for recordation shall:
(A) Be executed by the purchaser of the real property as part of a series of transactions conveying title to real property to the purchaser;
(B) Reference the deed conveying title to the purchaser of the real property by date and instrument number;
(C) Recite on the face of the document that it is a purchase money mortgage or purchase money deed of trust; and
(D) Recite on the face of the document the amount of purchase money that it secures.
(c) The parties to a deed which is submitted to the Mayor for recordation shall be jointly and severally liable for payment of the taxes imposed by this section; provided, that neither the United States nor the District of Columbia shall be jointly and severally liable with the transferee; provided further, that, beginning October 1, 2009, in the case of a deed that evidences a transfer of an economic interest in a cooperative housing association, the cooperative housing association shall be jointly and severally liable with the parties to the deed for the payment of taxes imposed by this section regardless of whether the cooperative housing association itself is a party to the deed.
(d) The deed and accompanying return shall be due as prescribed in § 47-1431(a) for the recordation of a deed; provided, that if the deed and return are submitted to the Recorder of Deeds before the due date, the return shall be due and taxes shall be due and owing at the time of submission.
(e)(1) Beginning October 1, 2017, for eligible property purchased by a first-time District homebuyer, the rate of tax provided in subsections (a), (a-4), and (a-5) of this section shall be reduced as follows; provided, that the requirements of paragraph (2) of this subsection are met; provided further, that the entire benefit of the reduced recordation tax rate shall be allocated to the grantees of the eligible property, as shown on the settlement statement or closing disclosure form:
(A) To 0.725% for a deed of title; or
(B) For an economic interest in a cooperative unit:
(i) To 1.825% when consideration allocable to the real property is less than $400,000; or
(ii) To 2.175% when consideration allocable to the real property is $400,000 or greater.
(2)(A) To be eligible for the reduced recordation tax rate provided by this subsection, the applicant for the reduced rate shall, at the time the deed is offered for recordation:
(i) Certify that the applicant is a first-time District homebuyer and is a bona fide District of Columbia resident;
(ii) Provide proof that the combined federal adjusted gross income, as shown on all the owners' and household members' federal income tax returns originally due or filed immediately before (if filed before the original due date) the deed is offered for recordation, is no higher than 180% of the Area Median Income as provided before the beginning of the real property tax year (and effective for such tax year) by the United States Department of Housing and Urban Development as a direct calculation without taking into account any adjustment;
(iii) Provide proof that the real property to be purchased is eligible property; and
(iv) Submit a copy of the homestead deduction application for the eligible property, signed by the applicant.
(B) For purposes of subparagraph (A)(ii) of this paragraph, the term "household" excludes any tenant occupying a separate dwelling unit under a written lease for fair market value.
(3) The Mayor or the Chief Financial Officer of the District of Columbia may require the applicant to provide such documentation as may be necessary or appropriate to substantiate entitlement to the reduced rate of tax provided under this subsection.
(f) By December 1 of the 4th year of the applicability of the recordation reduction tax benefit established by subsection (e) of this section, the Mayor shall submit a report to the Council that analyzes the impact of the recordation reduction tax benefit for first-time District homebuyers, which shall include:
(1) An analysis of the recordation tax rate reduction on homeownership in the District;
(2) The number of households who received the recordation tax rate reduction through December 31, 2021.
(3) The total number of home sales in the District within the time frame of the recordation tax rate reduction;
(4) An evaluation of the access to housing for people within the affected income range with the time frame of the recordation tax rate reduction;
(5) The overall housing affordability in the District each year that the recordation tax rate reduction was in place; and
(6) A recommendation regarding whether or not to continue the recordation reduction tax benefit.
(g) Notwithstanding subsection (c) of this section and § 47-4421, any subsequent deficiency of recordation tax determined to be owed on a deed taxed at the rate provided under subsection (e) of this section when the deed was accepted for recordation shall be the liability of the grantee or grantees solely and shall not create a lien on the real property that was transferred under such deed.
(h) Funds collected under this section shall be deposited pursuant to § 42-1122.
§ 42–1104. Computation of tax where absence of or no consideration; when fair market value to be shown on return; consideration on deeds of trust or mortgages.
(a) Consideration for a deed conveying title to real property or transferring an economic interest in real property, for purposes of the tax imposed by § 42-1103(a) and (b), including any mortgages, liens, or encumbrances thereon, shall be the amount required to be paid or provided in exchange for the execution and delivery of the deed. Where no price or amount is paid or required to be paid for the real property or for the transfer of an economic interest in real property or where the price is nominal, the consideration for the deed shall, for purposes of the tax imposed by § 42-1103(a) and (b), be the fair market value of the real property, and the tax shall be based upon the fair market value.
(b) On a deed conveying a security interest in real property, the principal amount of debt that the deed secures, for the purposes of the tax imposed by § 42-1103(c), shall be the principal amount of the debt recited on the face of the deed unless, from other information available to the Mayor, the Mayor determines that the principal amount of debt is a higher amount.
(c) Whenever, in the opinion of the Mayor, a submission for recordation does not contain sufficient information to determine the fair market value of real property conveyed by a deed, an economic interest in real property transferred by a deed, or the principal amount of debt secured by a deed, the Mayor may determine the amount from the information available.
§ 42–1105. Investigation by Mayor; summons; production of books, records, etc.; compelling attendance and production; refusal or obstruction of investigation. [Repealed]
Repealed.
§ 42–1106. No recordation until return filed and tax paid; deeds evidencing transfer of economic interest in real property in District. [Repealed]
Repealed.
§ 42–1107. Burden on taxpayer to prove deed exempt from tax.
For the purpose of proper administration of this chapter and to prevent evasion of the tax hereby imposed, it shall be presumed that all deeds are taxable and the burden shall be upon the taxpayer to show that a deed is exempt from tax.
§ 42–1108. Deficiencies in tax; notice of determination; protests; hearings; time for payment. [Repealed]
Repealed.
§ 42–1108.01. Enforcement.
This chapter shall be enforced in accordance with the provisions of chapters 41, 42, 43 and 44 of Title 47, including criminal enforcement, imposition or abatement of penalties and interest, administration of this chapter, and collection of taxes imposed hereunder; provided, that the denial of an exemption applied for under authority of § 42-1102 shall be subject to the same notice and appeal provisions and procedures as set forth under § 47-1009 relating to the denial of a real property tax exemption applied for under authority of § 47-1002.
§ 42–1109. When Mayor may compromise tax. [Repealed]
Repealed.
§ 42–1110. When Mayor may compromise tax; written agreement as to tax liability; finality thereof; penalties for certain acts in relation to compromises and agreements; prosecutions. [Repealed]
Repealed.
§ 42–1111. Mayor may compromise penalties and adjust interest. [Repealed]
Repealed.
§ 42–1112. Limitations; assessment or proceeding within 3 years of recordation of deed; exceptions; agreement to extend period; tolling thereof. [Repealed]
Repealed.
§ 42–1113. Administration of oaths and affidavits by Mayor. [Repealed]
Repealed.
§ 42–1114. Appeal from deficiency assessment.
Any person aggrieved by any assessment of a deficiency in tax finally determined by the Mayor under the provisions of § 42-1108 [repealed] may appeal to the Superior Court of the District of Columbia in the same manner and to the same extent as set forth in §§ 47-3303, 47-3304, and 47-3306 to 47-3308, as amended and as the same may hereinafter be amended.
§ 42–1115. Overpayments and refunds thereof. [Repealed]
Repealed.
§ 42–1116. Stamps and other devices as evidence of collection and payment of taxes. [Repealed]
Repealed.
§ 42–1117. Promulgation of rules and regulations by Mayor.
§ 42–1118. Abatement of taxes due where cost does not warrant collection. [Repealed]
Repealed.
§ 42–1119. Elimination of fractional stamps or devices; payment of tax to nearest dollar.
For the purpose of avoiding, in the case of any stamps or devices employed pursuant to authority of this chapter, the issuance of stamps or the employment of devices representing fractional parts of $1, the Mayor is authorized, in his discretion, to limit the denominations of such stamps or devices to amounts representing $1 or multiples of $1, and to prescribe further that where part of the tax due is a fraction of $1, the tax paid shall be paid to the nearest dollar.
§ 42–1120. General criminal penalties; prosecutions by Corporation Counsel [Repealed]
Repealed.
§ 42–1121. Illegal acts relating to stamps and other devices; penalties.
Any person who:
(1) With intent to defraud, alters, forges, makes, or counterfeits any stamp, or other device prescribed under authority of this chapter for the collection or payment of any tax imposed by this chapter, or sells, lends, or has in his possession any such altered, forged, or counterfeited stamp, or other device, or makes, uses, sells, or has in his possession any material in imitation of the material used in the manufacture of such stamp, or other device; or
(2) Fraudulently cuts, tears, or removes from any deed, parchment, paper, instrument, writing, or article, upon which any tax is imposed by this chapter, any adhesive stamp or the impression of any stamp, die, plate, or other article provided, made, or used in pursuance of this chapter; or
(3) Fraudulently uses, joins, fixes, or places to, with, or upon any deed, parchment, paper, instrument, writing, or article, upon which a tax is imposed by this chapter:
(A) Any adhesive stamp, or the impression of any stamp, die, plate, or other article, which has been cut, torn, or removed from any other deed, parchment, paper, instrument, writing, or article upon which any tax is imposed by this chapter; or
(B) Any adhesive stamp or the impression of any stamp, die, plate, or other article of insufficient value; or
(C) Any forged or counterfeited stamp, or the impression of any forged or counterfeited stamp, die, plate, or other article; or
(4)(A) Wilfully removes, or alters the cancellation or defacing marks of, or otherwise prepares, any adhesive stamp, with intent to use, or cause the same to be used, after it has already been used; or
(B) Knowingly or wilfully buys, sells, offers for sale, or gives away, any such washed or restored stamp to any person for use, or knowingly uses the same; or
(C) Knowingly and without lawful excuse (the burden of proof of such excuse being on the accused) has in possession any washed, restored, or altered stamp, which has been removed from any deed, parchment, paper, instrument, writing, package, or article;
shall be guilty of a felony and, upon conviction thereof, shall be fined not more than $5,000 or imprisoned not more than 3 years, or both.
§ 42–1122. Depositing collected money.
All monies collected under this chapter shall be deposited in the General Fund; except, that:
(a) In fiscal years ending before October 1, 2023:
(1) 15% of the monies collected under this chapter shall be deposited into the Housing Production Trust Fund established by § 42-2802 ("Housing Production Trust Fund"); and
(2) 85% of the monies collected under this chapter for the transfer of Lots 836, 837 and 855 in Square 37, or such successor record or assessment and taxation lots as may be created through future subdivision or creation of condominium units, shall be deposited in the West End Library and Fire Station Maintenance Fund established by § 1-325.181 ("West End Library and Fire Station Maintenance Fund");
(b) In Fiscal Years 2024, 2025, 2026, and 2027:
(1) The lesser of the following amounts shall be deposited in the Housing Production Trust Fund:
(A) 15% of the monies collected under this chapter; or
(B) 102% of the amount deposited into the Housing Production Trust Fund in the prior fiscal year pursuant to this section; and
(2) 85% of the monies collected under this chapter for the transfer of Lots 836, 837 and 855 in Square 37, or such successor record or assessment and taxation lots as may be created through future subdivision or creation of condominium units, shall be deposited in the West End Library and Fire Station Maintenance Fund; and
(c) In fiscal years beginning on or after October 1, 2027:
(1) 15% of the monies collected under this chapter shall be deposited into the District of Columbia Housing Authority capital project DEVELOPMENT AND REHABILITATION-DCHA;
(2) 15% of the monies collected under this chapter shall be deposited into the Housing Production Trust Fund; and
(3) 70% of the monies collected under this chapter for the transfer of Lots 836, 837 and 855 in Square 37, or such successor record or assessment and taxation lots as may be created through future subdivision or creation of condominium units, shall be deposited in the West End Library and Fire Station Maintenance Fund.
§ 42–1123. Separability clause.
If any provision of this chapter, or the application thereof to any person or circumstances, is held invalid the remainder of this chapter, and the application of such provision to other persons or circumstances, shall not be affected thereby.
§ 42–1124. Appropriations to carry out provisions of chapter.
There are hereby authorized to be appropriated such amounts as may be necessary for the carrying out of the provisions of this chapter, including the use of stamps or other devices for evidencing payment of the tax imposed by this chapter.
