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Dear PoPville – DC Homestead Deduction Question and Rant

by Prince Of Petworth January 24, 2013 at 2:30 pm 41 Comments

Photo by PoPville flickr user thisisbossi

Dear PoPville,

File this under DC Dysfunctional Government –

Since I’ve moved into my DC condo over 3 years ago (back in 2009), I’ve been trying to get the Homestead deduction. It’s pretty significant amounts to several hundred dollars a year.

The first few times I applied, my application was not accepted because there was a apparently a mistake in how my deed was recorded. It had to something to do with the square and lot numbers not matching up with the unit numbers. (i.e. the original unit numbers in my 4-unit building were 1,2,3,4 but they ended up changing it to B, 1,2,3 so there was a mix-up).

I called my title company, and they went about correcting it. Apparently, they re-recorded the deed back in summer 2010 or 2011, so that my square and lot numbers would correspond to the correct unit number in all the paperwork (deed, Condo Declaration, etc).

I re-applied for the deduction soon thereafter, and received no response. I’ve called a few times, and I had been told that it takes time for DC to make the change.

I called again recently to see what’s going on, and I had then found out that your ownership of your home shows up in two databses: The Recorder of Deeds and the Property Tax Assessment database. Apparently, the DC Recorder of Deeds made the appropriate change in their database when my title company re-recorded the deed back in 2010 or 2011, but the Assessment database is not necessarily updated.

Of course, this is a little ridiculous. I’ve been paying my property taxes, and the DC government has been happily accepting my payments. You would think that the DC government would change their database to reflect who’s actually paying the taxes and to reflect the actual owner per the Recorder of Deeds.

I’ve been trying to call and email the Supervisor and Auditor at the Office of Tax and Revenue, per instructions I’ve received from the DC Customer Service line. I have not gotten any responses to my phone calls or emails.

Has anyone else experienced the same issue? And how did they fix it?

  • Anonymous

    All I can suggest is to be persistent. Another option would be to retain a tax lawyer, who could then threaten to sue so many relevant agencies that it bankrupts the District, at which point they agree to make the correction and pay you a settlement for so much wasted time and energy.

  • Roz

    Typical Gray Government.

    • Anonymous

      You are completely clueless. This is a function of the CFOs office, which in DC is a completely independent branch of government. Gray has no jursidiction over the CFO.

      • Roz

        That’s what she said! Hahaha. LOL.

  • Anonymous

    Contact your city counsel member. I had a similar problem with DC OTR and as soon as they got an email from Jim Grahams office the problem was fixed within a week.

    • +1 i did the same. contact council member

    • Anonymous

      Me too. Called Tommy Wells’s office, and it was fixed within the week.

  • I had an issue with the homestead deduction that cost my family almost $20k. I found OTR to be split into two camps: incompetent idiots not worth talking to and evil a-holes who interpret the law in their favor and then screw you. My advice: pay whatever you are required to, give up on any semblance of justice and move on.

    • jcm

      How could the homestead deduction cost you $20K? It’s only worth $600 a year.

      • It was a property tax issue that involved the homestead deduction and another one. We applied for them and the city approved us. Years later they determined that we didn’t qualify for them after a city attorney reinterpreted the law. We were charged back taxes with penalties and interest that actually was around $30k.

        The price tag kept going up with successive letters from the city. Nobody at the city could explain what was going on. We engaged our council member but she didn’t seem to know how to help. We had to get a lawyer who confirmed that OTR was being evil bastards but fighting them would cost way more than it was worth, so we sucked it up and cut a deal with the city that forgave the penalties and interest.

  • Are you me? Because I am having the same problem–also bought 3 years ago, also had a major kerfuffle with the OTR regarding the unit number for my condo and not having the deed transfer to my name, which still hasn’t been worked out. If you do get this resolved, please keep us posted so I know what can be done to resolve this!

  • ah

    How about filing an appeal of the “denial” of the homestead deduction? They have to respond to that.

  • Anonymous

    Your best bet is to go down to the offices in person, there was a mixup with my deduction when I first moved into the City back in 1995. Went down to the office of tax and revenue IN PERSON and sorted the mess out. Emails and phonecalls are easy to avoid.

    • goinperson

      I second going in person. Made all the difference in the world for my case. Also keep track of the names of the people you meet with in case you need to go back. They open early (8am?). Get there first thing and there is no wait.

      • DCer

        and, I would add, as hard as it might be,
        Remain calm.

  • Andrew

    Doesn’t the homestead deduction only apply to the first year tax bill only?

  • I Did

    I went through something similar. When I bought and closed I applied for Homestead deduction. This was back in 05 when property assessments were high. Something happened where my record of deed was lost and 1 year later I had to go to my title company and file again. Needless to say the assesments went up higher. When it was all corrected they didn’t make it retroactive to when I orinally filed and when the assessment was about 30K lower. Thank God that assessment went down for the past few years, because I know pay almost 1K less in taxes.

  • Anonymous

    Can someone explain in simple terms what the homestead deduction is exactly?

    • I Did

      It is a tax credit/cap for DC homeowners who occupy their primary residence. Basically it puts a cap on the % that your tax bill can increase based on assessments. It’s has reduce my property taxes by a 1/3 if not more.

      • That’s not the homestead deduction, that’s the assessment cap credit.

        • I Did

          OK fair enough. I thought they went hand in hand. It’s been 7 years and I don’t remember having to apply for both individualy. But I may be wrong.

          • I’m just going by what’s on the OTR website. I don’t think you have to apply for the assessment cap credit which is possibly why you don’t remember doing it.

            “…it will appear as an automatic credit against your real property tax bill.”

            (Disclaimer: I have no idea how it worked 7 years ago. I’m assuming it wasn’t totally different from now.)

    • If the property is your primary residence, then DC deducts $67,500 from the assessed value of the property before they determine how much property tax you owe, which means you owe less.

      • I Did

        OK fair enough. I thought they went hand in hand. It’s been 7 years and I don’t remember having to apply for both individualy. But I may be wrong.

      • Anonymous

        Thank you

  • We actually had no issues whatsoever – applied as soon as we realized we could and got approved before the next tax bill hit. It all went off totally without a hitch!

  • Anon

    Be persistent, and call and email your Council member. They have more clout with the agencies than you do. Keep following up with the agencies AND with your Council member. That’s what I had to do.

  • Formerly CoHi

    Yes. Move to MD

  • Anonymous

    you are in a nightmare scenario with no good out. retain a lawyer.

  • Anonymous

    I bought my condo in 2010. I noticed last summer that my homestead deduction was never processed. Per OTR Customer Service’s referral, I worked with Eddie Harris in the OCFO to get it resolved. You can try emailing him [email protected] and copying the office’s general email [email protected]. Then I would followup with a call. OTR’s customer service can probably give you his direct line. It took me another three months to get the money refunded from my mortgage company (which pays my property taxes from escrow). I chose that route vs. trying to claim the refund from the DC government directly, which is possible, but potentially another bureaucratic nightmare. Good luck!

  • Anonymous
  • Anon X

    I had a similar problem and it took me less than 2 business days to have it resolved and properly reflected online.

    I was emailing back and forth with a couple of people at OTR and they were able to help. I don’t remember who, but I had to get past the phone answerers.

  • Anon

    Just in terms of getting OTR to respond — they suck. But I twitter bombed them and that worked. I had a different problem, entirely of their creating, and I seriously just sent them multiple tweets a day until they gave me numbers. :)

  • Anonymous

    Good advice here. Go in person. Don’t leave till they fix it.

    Not surprised this happened to you. I had to call over there once. The staff were indifferent.

  • I had a similar problem, except that my title insurance company had to go through the Assessor instead of through the Recorder of Deeds. By going through the Assessor, both databases were updated correctly.

  • Mt P

    I had a similar problem, and also bought a condo 3 years ago– the deed change was not reflected in the Property Tax Assessment database. My seller was exempt from property taxes, so I got a huge return check (mistakenly) after almost 2 years of ownership, had to refile the deed with both the Recorder of Deeds and the Tax Assessment office, and refiled my Homestead Deduction. My taxes are paid through my lender, and it was such a mess– I put the entire return back into escrow, then got slapped with a $900 deficit from my lender in the fall, which I paid in full. Never got any sort of confirmation that the deduction went through. I assume it’s resolved but who the heck knows– I’m trying to re-fi so I guess I will find out soon enough. It’s a total circus over there. Good luck!!!

  • Anonymous

    Go to the Dept of Consumer & Regulatory Affairs (1100 4th St, SW) in person. I am going through a similar issue and my husband had to go in person to receive any response. There was an appeals form that we needed to fill out and we had to prove that we have occupied the property for the last 3 years. I printed 3 years worth of water bills, electric, gas and other “proof of residency” along with our homeowner’s policy. They were surprised when we had so much “proof” that the property was occupied (they listed us as vacant w/ $16k/yr taxes) and immediately assisted with correcting their database.

    They will tell you that it will take 2-3 weeks for them to process the paperwork and they will file the papers with their other office. You can wait to have them process it and then walk across the street to building 1104, and file it yourself.

    Good luck!

  • Alex

    We’re dealing with a similar problem. Bought our home in june 2011 and the homestead application was submitted with the deed. As we pay taxes via escrow, we mistakenly assumed everything was fine. Just found out our property taxes are doubling for 2013, and it turns out our application was never processed/ acknowledged – do we have any recourse for getting this applied retroactively? Or are we just screwed, and need to re-apply and deal with the tax increase? I’ve already reached out to Eddie Harris via phone and email but haven’t gotten a response yet.


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