How to Fill Out DC Form D-40: Deductions, Credits, and Filing

To fill out DC Form D-40, start with your completed federal Form 1040, carry your federal adjusted gross income onto the DC return, make the District’s required additions and subtractions, apply either the standard or itemized deduction, calculate tax using DC’s graduated brackets, subtract credits and payments already made, and file through MyTax.DC.gov or by mail. For tax year 2025, the return is due April 15, 2026.¹

What You Need Before You Open the Form

Pull these together first. The return goes much faster when nothing sends you looking.

Your completed federal Form 1040. Line 11 (federal AGI) is where the D-40 begins, and most other lines reference it.
Social Security numbers for you, your spouse if filing jointly, and every dependent.
All W-2s, 1099s, interest and dividend statements, and retirement distribution forms.
Records of any estimated DC tax payments you made during the year on Form D-40ES, with dates and amounts.²
Your 2025 property tax bill or total rent paid, if you plan to claim the Schedule H credit.

Step 1: Start From Your Federal AGI

Finish your federal 1040 before you touch the D-40. The federal AGI from line 11 is the starting figure on the DC return, and nearly every subsequent line either flows from it or refers back to the federal form.³ If your federal return is wrong, the DC return will be wrong in the same way.

Step 2: Add Back DC-Specific Items

DC taxes some income the federal government does not, so you add those amounts back. Report the additions on Schedule I, Calculation A. The ones that catch the most filers:

DC franchise tax you deducted on a federal business return (Form 1065 or 1120-S) gets added back on the D-40.³
Interest on out-of-state bonds. Beginning with tax year 2025, DC only exempts interest from DC-issued bonds; interest from other states’ and localities’ bonds is taxable and must be added.⁴
Federal bonus depreciation and extra Section 179 expensing. If you claimed 100% bonus depreciation or additional Section 179 on your federal return, report those amounts here.³

Step 3: Subtract What DC Does Not Tax

Then subtract income DC does not tax, on Schedule I, Calculation B. The big one is unemployment benefits: DC excludes unemployment insurance from gross income entirely, no matter the amount.³ If any unemployment showed up in your federal AGI, subtract it here. Certain government grants listed under DC Code § 47-1803.02 also come out if they were part of your federal AGI.

Step 4: Pick Your Deduction

Choose the standard deduction or itemize. For tax year 2025 the standard deduction is $15,000 for single filers or married filing separately, $22,500 for head of household, and $30,000 for married couples filing jointly or qualifying widow(er)s.

If you or your spouse are 65 or older or blind, you qualify for an additional standard deduction: $1,550, or $1,950 if your filing status is single or head of household. Compute it on Schedule S, Calculation G-1, and attach the schedule to your return.³

If you itemize, use Schedule S. DC generally follows federal itemized-deduction rules, so your numbers should track closely with federal Schedule A.

Step 5: Apply the DC Tax Rates

After subtracting your deduction from adjusted income, you have DC taxable income. Apply the graduated bracket schedule, which is the same for every filing status; DC does not use separate bracket tables for married versus single filers.⁵

Up to $10,000: 4% of taxable income
$10,001 to $40,000: $400 plus 6% of the amount over $10,000
$40,001 to $60,000: $2,200 plus 6.5% of the amount over $40,000
$60,001 to $250,000: $3,500 plus 8.5% of the amount over $60,000
$250,001 to $500,000: $19,650 plus 9.25% of the amount over $250,000
$500,001 to $1,000,000: $42,775 plus 9.75% of the amount over $500,000
Over $1,000,000: $91,525 plus 10.75% of the amount over $1,000,000

Step 6: Claim Your Credits

DC Earned Income Tax Credit

For tax year 2025, the DC EITC equals 100% of your federal EITC.⁶ If you qualify for a $3,000 federal credit, DC adds another $3,000. It is fully refundable, meaning you receive it even when you owe no DC tax. You must have claimed the federal EITC first; then carry that credit amount onto your D-40.

Schedule H Property Tax Credit

Renters and homeowners who lived in DC all year may qualify. Federal AGI must be $68,000 or less, or $90,000 or less if you are 70 or older. You do not qualify if you live in public housing or if your landlord’s property is exempt from DC property taxes.⁷

The credit covers property tax (or 20% of rent, treated as the property tax equivalent) above a threshold set at 3%, 4%, or 5% of your AGI depending on income. Maximum credit is $1,425. Renters miss this one most often.

Step 7: List Dependents on Schedule S

Schedule S does more than itemized deductions. It is also where you list each dependent with name, Social Security number, relationship, and date of birth. Head of household and qualifying widow(er) filers report the qualifying person here. Married couples filing separately on the same return use Calculation J on Schedule S to split the tax.³ Failing to attach Schedule S when you claim dependents or the additional standard deduction is one of the fastest ways to trigger a processing delay.

Step 8: Subtract Payments and Figure Refund or Balance Due

From your calculated tax, subtract DC income tax withheld (on your W-2s and 1099s), any quarterly estimated payments made on Form D-40ES, and refundable credits like the DC EITC and Schedule H. If payments and credits exceed tax, you get a refund. If tax exceeds payments and credits, you owe the difference. If you plan to file jointly, make sure any estimated payments were also made jointly, or the credit may not match and you will need to sort it out with the Office of Tax and Revenue.

How to Submit the Return

Electronic filing through MyTax.DC.gov is the fastest route. Create or log into your account, enter the return and schedules, submit, and receive immediate confirmation.³ E-filed returns are generally processed within about six weeks.⁸ Track status with the “Check Your Tax Refund Status” tool at MyTax.DC.gov.⁹

If you mail a paper return, the address depends on whether you owe:¹⁰

Refund or no payment: Office of Tax and Revenue, PO Box 96145, Washington, DC 20090-6145
With payment (include a D-40P voucher): Office of Tax and Revenue, PO Box 96169, Washington, DC 20090-6169

Mailing the wrong box causes significant delays. Paper returns also take longer across the board, up to about eight weeks when anti-fraud screening pulls a return for additional review.

If You Owe and Cannot Pay by April 15

File anyway. The late-filing penalty is far steeper than the late-payment penalty, so getting the return in on time and arranging payment later is always the better move. Payment options through MyTax.DC.gov include:¹¹

ACH debit from your bank account, no fee.
Credit or debit card, with a 2.25% convenience fee.
ACH credit through your bank using the NACHA format (see OTR’s Electronic Funds Transfer guide).
Check or money order payable to “DC Treasurer,” with your Social Security number and the tax year on the payment, mailed to PO Box 96169.

Both late-filing and late-payment penalties run at 5% of the unpaid tax per month, each capped at 25%, and they can run at the same time.¹² Interest on unpaid balances accrues at 10% per year, compounded daily.¹³

If You Need More Time to File

Submit Form FR-127 by April 15 to get a six-month extension, moving your deadline to October 15.¹⁴ File FR-127 through MyTax.DC.gov or by mail. The extension gives you more time to file, not more time to pay, so include a payment with FR-127 if you expect to owe. Taxpayers living or traveling outside the United States can request an additional six months past October 15.

Fixing a Mistake After Filing

If you find an error later, submit Form D-40X (Amended Individual Income Tax Return) through MyTax.DC.gov or by mail. You generally have three years from the original filing deadline to amend and claim a refund. If the correction comes from an amended federal return, wait until the federal amendment is processed, then file the D-40X right after, since DC’s figures depend on your federal AGI.

1
DC.gov. Mayor Bowser Reminds DC Residents to Take Advantage of Tax Credits and Free Resources Ahead of April
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Office of Tax and Revenue. 2025 D-40ES Estimated Payment for Individual Income Tax
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Office of Tax and Revenue. District of Columbia Individual Income Tax Forms and Instructions
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Office of the Chief Financial Officer. Fiscal Impact Statement – Parker Frumin Amendment
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Office of Tax and Revenue. DC Individual and Fiduciary Income Tax Rates
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Department of Insurance, Securities, and Banking. Earned Income Tax Credit Campaign
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Office of Tax and Revenue. 2025 Schedule H Property Tax Credit
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Office of Tax and Revenue. Refund FAQs
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Office of Tax and Revenue. Check Your Tax Refund Status
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Office of the Chief Financial Officer. Mailing Addresses for DC Tax Returns
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Office of Tax and Revenue. Payment Options
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D.C. Law Library. District of Columbia Code 47-4213 – Failure to File Return or to Pay Tax
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Office of Tax and Revenue. Notice of Delinquency (TDI)
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Office of Tax and Revenue. FR-127 Extension of Time to File a DC Income Tax Return