District of Columbia § 47-4509 Local tax exemption.

District of Columbia Statutes

§ 47-4509 — Local tax exemption.

District of Columbia·Title 47 Taxation, Licensing, Permits, Assessments, and Fees. [Enacted title]·Ch. 45 College Savings Program.

(a)An account owner who files an income tax return in the District of Columbia may claim a deduction in an annual amount not to exceed $4,000 for contributions made to all accounts under the Program. With respect to married individuals (or domestic partners registered under § 32-702 ) filing a joint return, each married individual (or domestic partner registered under § 32-702 ) may claim a deduction in an annual amount not to exceed $4,000 for contributions made to all accounts under the Program for which the married individual (or domestic partner registered under § 32-702 ) is the account owner.

(b)If an amount greater than $4,000 is contributed to one or more accounts in a tax year, the excess may be carried forward as a deduction, subject to the annual limit, for 5 years.

(c)Any

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(a) An account owner who files an income tax return in the District of Columbia may claim a deduction in an annual amount not to exceed $4,000 for contributions made to all accounts under the Program. With respect to married individuals (or domestic partners registered under § 32-702 ) filing a joint return, each married individual (or domestic partner registered under § 32-702 ) may claim a deduction in an annual amount not to exceed $4,000 for contributions made to all accounts under the Program for which the married individual (or domestic partner registered under § 32-702 ) is the account owner.

(b) If an amount greater than $4,000 is contributed to one or more accounts in a tax year, the excess may be carried forward as a deduction, subject to the annual limit, for 5 years.

(c) Any deduction taken under this section shall be subject to recapture with respect to a withdrawal or rollover taken within 2 years of the establishment of the account for any reason other than provided in subsection (d) of this section. In addition, notwithstanding the statute of limitations on assessments in § 47-912 [repealed], any deduction taken under this section shall be subject to recapture in the taxable year in which the withdrawal or rollover is made after 2 years of the establishment of the account for any reason other than provided in subsection (d) of this section or to transfer to another qualified tuition program.

(d) Deductions taken under this section shall not be subject to recapture as provided in subsection (c) of this section if:

(1) The funds are used to pay for qualified higher education expenses;

(2) The beneficiary dies, develops a disability, or receives a scholarship;

(3) The beneficiary receives a scholarship; provided, that the exemption shall be limited to the amount of the scholarship; or

(4) The funds are transferred to another account maintained under the Program.

(e) Subject to subsection (f) of this section, earnings on accounts shall be exempt from District of Columbia income taxation.

(f) Qualified withdrawals shall be exempt from District of Columbia income taxation. The portion of any other withdrawal that is attributable to account earnings shall be subject to District of Columbia income taxation in the year in which the withdrawal is made.

District of Columbia § 47-4509 (Local tax exemption.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Legislative History

Mar. 31, 2001, D.C. Law 13-212, § 2(b), 47 DCR 9457; June 5, 2003, D.C. Law 14-307, § 2402(i), 49 DCR 11664; Mar. 14, 2007, D.C. Law 16-292, § 2(i), 54 DCR 1080; Apr. 24, 2007, D.C. Law 16-305, § 73(j), 53 DCR 6198; May 13, 2008, D.C. Law 17-153, § 2, 55 DCR 3460; Mar. 25, 2009, D.C. Law 17-353,§ 172(e)(3), 56 DCR 1117