DC Personal Property Tax: Form FP-31, Exemptions, and Deadlines

The District of Columbia taxes tangible business personal property at $3.40 per $100 of depreciated value above a $225,000 exemption, and every business operating in D.C. must file Form FP-31 through MyTax.DC.gov between July 1 and July 31 each year — even if the total value falls under the threshold and no tax is owed.¹²

Who Has to File

Anyone who owns or holds tangible personal property in a trade or business in the District has to file Form FP-31. That covers sole proprietors, partnerships, corporations, and fiduciaries like trustees, executors, and receivers, and it applies whether or not the business operates for profit. Property kept in storage, or held for rent or lease to third parties, government agencies, or nonprofits, also triggers the filing obligation.²

Here’s the piece most small businesses miss: you still file the return when your assessed value is $225,000 or less and you owe nothing. The exemption zeroes out the tax, not the return. Skipping the filing on the assumption that you’re too small is one of the most common ways to pick up a failure-to-file penalty.²

What Property Is Taxed

D.C. defines taxable tangible personal property broadly as tangible goods and chattels used or available for use in any business activity, and computer software is explicitly included.³ In practice, the items most businesses report are office furniture and fixtures, machinery, printing and manufacturing equipment, restaurant fixtures, medical and dental equipment, construction tools, signs, solar panels, and libraries.⁴

Leased Equipment

The owner of leased property files and pays, not the user. If you lease copiers, vehicles, or machinery to other D.C. businesses, those assets are yours to report. If you lease from a vendor, the vendor carries the obligation.²

What’s Exempt

Motor vehicles and trailers registered with the D.C. Department of Motor Vehicles are exempt because they already carry separate registration fees. Special equipment mounted on a registered vehicle but not primarily used for transportation is still taxable, so a delivery van is exempt while a hydraulic lift permanently installed on it can be taxed as personal property.⁵

Construction equipment, vehicles, and tools brought into the District temporarily are not exempt. They are taxed for the period they are physically located in D.C.⁶

How the Tax Is Calculated

The District does not tax assets at what you paid for them. It applies depreciation schedules that reduce the reportable value over time based on the type of property. The FP-31 instructions sort assets into three categories:⁴

Category A, 10-year life, 10% per year. Most common business property, including office furniture, fixtures, restaurant equipment, medical equipment, signs, and solar panels.
Category B, 15-year life, 6.67% per year. Antennas, transmitting towers, fiber optic cables, safes, watercraft, and pianos.
Category C, 8-year life, 12.5% per year. Construction equipment, car wash equipment, and building maintenance equipment.

There is a floor. Most property cannot be depreciated by more than 75% of its original cost, so it keeps at least 25% of its value on the books for as long as you own it. Qualified technological equipment can be depreciated up to 90%, leaving a 10% floor. A twenty-year-old desk still carries taxable value.⁴

Add the depreciated values together. If the total is above $225,000, subtract the exclusion and multiply the remainder by 0.034. A business with $300,000 in depreciated value pays tax on $75,000, which comes to $2,550.¹

How to File Form FP-31

FP-31 is filed exclusively through MyTax.DC.gov. Paper forms are no longer printed or mailed.⁴ You’ll need a taxpayer identification number (FEIN, SSN, ITIN, or PTIN) and the original acquisition dates and costs for each piece of tangible property. The portal applies the depreciation schedules to those figures and calculates the tax. Payment is made through the same portal by electronic funds transfer or credit card. After submission the system generates a timestamped confirmation number; keep it with your business records.

Deadlines, Extensions, and Penalties

The filing window opens July 1 and closes July 31. You can’t file before July 1, and both the return and any payment are due by the end of the month.⁷

If you need more time, file Form FP-129A before August 1. The request must be in writing and must include payment of the estimated tax owed. The maximum extension runs three months past July 31, pushing the latest possible filing date to October 31. An extension of time to file is not an extension of time to pay; the tax itself is still due by July 31.⁷

Missing the deadline is expensive. The Office of Tax and Revenue charges a 5% penalty per month, or partial month, on the unpaid tax, up to a maximum of 25%. Interest accrues at 10% per year, compounded daily.⁸ On a $5,000 bill, a two-month delay adds $500 in penalties plus roughly $83 in interest. The Mayor has authority to waive penalties and interest for reasonable cause, but filing on time is far less trouble than asking for forgiveness later.

Nonprofit Exemption

If your organization has IRC Section 501(c)(3) status, the personal property exemption is available but not automatic. You have to apply for a certificate of exemption by submitting Form FR-164 through MyTax.DC.gov. Until that certificate is issued, the organization owes the tax like any other business.² And even with a certificate, property used in activities that generate unrelated business income taxable under IRC Section 511 stays on the tax rolls. A nonprofit gift shop or side rental operation doesn’t get the exemption on the equipment tied to it.

Closing a Business

When a D.C. business ceases operations, the FP-31 obligation does not quietly go away. File a final FP-31 and check the “final return” option. OTR then cancels the future filing requirement.⁴ Without that final return on record, the agency may keep expecting annual filings and assess non-filing penalties in later years for a business that no longer exists.

1
D.C. Law Library. District of Columbia Code 47-1522 – Levy of Annual Tax on Personal Property
2
Government of the District of Columbia Office of the Chief Financial Officer. FP-31 District of Columbia Personal Property Tax Instructions and Specifications
3
D.C. Law Library. District of Columbia Code 47-1521 – Definitions
4
Office of the Chief Financial Officer. FP-31 District of Columbia Personal Property Tax Instructions and Specifications
5
D.C. Law Library. District of Columbia Code 47-1508 – Exemptions
6
D.C. Law Library. District of Columbia Code Subchapter II – Procedure
7
D.C. Law Library. District of Columbia Code 47-1524 – Form of Tax Return; Filing; Extensions
8
DC Office of Tax and Revenue. Notice of Tax Due