RENTAL HOUSING BUSINESS Application Checklist

Careful consideration should be given to a company’s legal structure.

The information below, provided by the Corporations Division of Department of Licensing and Consumer Protection can provide general information on each organization type, but strongly suggests you contact an attorney and/or an accountant before making a final decision.  Ultimately, you must select the structure that best suits your business needs.

To operate in the District of Columbia as one of the following business types:

• a nonprofit and for-profit corporation,
• limited liability company,
• limited partnership,
• limited liability partnership,
• general cooperative association,
• limited cooperative association and
• statutory trust,

you must register via CorpOnline with Superintendent of Corporations of Corporations Division of the Department of Licensing and Consumer Protection.

For other types of businesses, like below, do not need to register.

• Sole proprietors
• General partnership
• Unincorporated Condo association;
• Unincorporated nonprofit association.

To benefit the business community, the District of Columbia allows registration and use of a trade name, a business name which is different from your true name, if you are an individual, or from your corporation, partnership, or company name. The name used for your registered entity (i.e., corporation, partnership, LLC, etc.) does not need to be registered as your trade name; your registered entity name is considered to be your business' true name.

The benefits of registering your business name include:

• Using fictitious or shortened business names in conducting business, including transacting business with vendors and financial institutions (For example: use of fictitious names such as "Scarves by Sandra," or use of a shortened version of a corporate name such as "Fullerton's" for "The Fullerton Corporation")
• Providing official records of all owners associated to a business name
• Allowing entities with business names to undertake legal action under that name

Definition of Trade Name

A trade or fictitious name is any name used in business that does not include the full legal name of all the owners of the business. Your trade name is different from your corporate name; your business may have only one corporate name but as many trade names as you desire. “Trade name” means a word or name, or any combination of a word or name, used by a person to identify the person's business which:

• (A) Is not, or does not include, the true and real name of all persons conducting the business; or
• (B) Includes words which suggest additional parties of interest such as “company,” “and sons,” or “and associates.”

An EIN is needed by many businesses to allow the IRS to associate business taxpayers to tax fillings.

Generally, you will need an EIN if you answer yes to any of the following questions:

• Do you have employees?
• Do you operate your business as a corporation, LLC, or partnership?
• Do you file any of these tax returns: employment excise; or alcohol, tobacco, and firearms?
• Do you withhold taxes on income, other than wages, paid to a non-resident alien?
• Do you have a Keogh plan? (a tax-deferred pension account)?
• Are you involved with an of the following: trusts (except certain grantor-owned revocable trusts), individual retirement accounts, exempt organization business income tax returns, estates, real estate mortgage investment conduits, non-profit organizations, cooperatives, or plan administrators?

What you’ll need to apply:

• Details on your business structure (type of organization, your role, etc.)
• Address information for your business
• Employee information (number expected, first date wages were paid, etc.)
• Details about activities of your business (principal activity, etc.)

Where to apply?

You can apply for an EIN with the IRS online, by fax, or by mail. To register online, use the IRS EIN Assistant. To apply by fax or mail, review the IRS instructions for details.

Combined Registration Application for District of Columbia Business Taxes/Fees/Assessments

You will need the following information to complete the online tax registration form:

• Your Federal Employer Identification Number (FEIN), Individual Taxpayer Identification Number (ITIN) and/or Social Security Number (SSN)
• Note: Your ID Type (e.g. FEIN, SSN, or ITIN), determines which tax accounts your business is eligible for when completing the FR-500.
• When registering a business with a SSN or ITIN, your eligible tax accounts are:
  • Sales & Use Tax
  • Specialized Sales
  • Street Vendor
  • Ballpark Fee
  • Personal Property Tax
  • Sports Wagering Tax
• All other tax accounts will require your business to register with a FEIN.
• Business Name and Trade name must be registered and/or updated with DLCP. Also, ITINS may not be used with the following tax accounts:
  • Corporate Franchise
  • Withholding Wage
  • Withholding Non-Payroll
• Your legal form of business (e.g. partnership, corporation, sole proprietor)
• Your primary business address and the addresses for all locations where you will collect sales tax in the District of Columbia
• The names, titles, home address, SSN and/or ITIN of the proprietor, partners, or principal officers (required)
• The former entity information if previously registered with the District of Columbia

If you're a special event promoter hosting an event with at least 50 vendors, please use the How to Register a Special Event Form FR-500B Guide.

The following documents must be attached based on the type of business registering for the FR-500:

This is for new registrations only. To make updates to an existing business account (The addition of a Corporate Franchise account requires a new registration) or to submit a web message, please log in to your MyTax.DC.gov account. Should you need further assistance, you may submit an email to the Office of Tax and Revenue's e-Services Unit (OTR) at e-Services.otr@dc.gov or call (202) 759-1946.

Homestead Deduction and Senior Citizen or Disabled Property Owner Tax Relief:

This benefit reduces your real property's assessed value by $78,700 (savings of $668.95) prior to computing the yearly tax liability.

The Homestead benefit is limited to residential property. To qualify:

1. An application must be on file with the Office of Tax and Revenue;
2. The property must be occupied by the owner/applicant and contain no more than five dwelling units (including the unit occupied by the owner); and
3. The property must be the principal residence (domicile) of the owner/applicant.

If a properly completed and approved application is filed from October 1 to March 31, the property will receive the Homestead benefit for the entire tax year (and for all tax years in the future). If a properly completed and approved application is filed from April 1 to September 30, the property will receive one-half of the benefit reflected on the second-half tax bill (and full deductions for all tax years in the future).

The District of Columbia “Clean Hands” mandate (DC Code § 47-2862) stipulates that individuals and businesses are to be denied city goods or services (e.g. licenses, permits, grants, contracts) if there is a debt owed to the District of Columbia of more than $100 for fees, fines, taxes, or penalties; and/or failure to file required District tax returns.

The Office of the Chief Financial Officer, Office of Tax and Revenue (OTR) facilitates administration and compliance of the Certificate of Clean Hands (CCH) mandate by providing individuals and businesses online self-service capability to generate or, in certain circumstances, request a “Clean Hands” certificate.

How do I request a Certificate of Clean Hands (CCH)?

Certificate of Clean Hands can be requested via OTR’s online portal, MyTax.DC.gov.

If you are a District of Columbia individual or business taxpayer, you must log-in to your MyTax.DC.gov account to generate the request.

If you do NOT have a MyTax account and are required to pay District of Columbia taxes (business or individual), you must first create a MyTax.DC.gov account. Once the account has been created, you can utilize the self-service feature to execute the request.

If you are not required to pay District of Columbia taxes and require a Certificate of Clean Hands, a manual request can be requested here.

What is evaluated when I request a Certificate of Clean Hands via the MyTax.DC.gov online portal?

The Clean Hands process assesses a taxpayer’s accounts with the Office of Tax and Revenue (OTR) and the Department of Employment Services for liabilities and unfiled returns.

Does a MyTax issued Certificate of Clean Hands have an expiration date?

A Certificate of Clean Hands represents your compliance status at the point-in-time the certificate is issued. Accounts balances can (and do) change through the passage of time and events. For this reason, functionality has been built into the system that allows agencies to confirm the authenticity of a presented certificate as well as to receive an up-to-date compliance status; however, for non-resident applicants, the Certificate of Clean Hands will expire 90 days from the date of issuance. Once the Certificate of Clean hands has expired, applicants must re-apply on MyTax.DC.gov.

The purpose of a Certificate of Occupancy (“COO” or “C of O”) is to ensure that the use of a building, structure or land in the District of Columbia conforms to the Zoning Regulations (DCMR Title 11) provisions of the DC Construction Codes, and the Green Building Act. In most cases, no person can use a building, structure or land in the District of Columbia for any purpose other than a single-family dwelling, until a valid Certificate of Occupancy has been issued.

Building Permit Fee Schedule

Source: https://dob.dc.gov/node/1620346

The Department of Buildings (DOB) supports a thriving community of residents, businesses, and visitors through diligent protection of health and safety and equitable administration of regulation and compliance in the District. It is DOB's mission to ensure your building and your unit is healthy and safe.

Business activity in and/or to the District requires owners/operators to be licensed according to the business activity conducted (e.g. convenience stores, home improvement contractors, residential rentals, restaurants).

Each licensed activity has a set of requirements, see categories below, but all licenses have to complete the four requirements outlined in the Steps to Obtain a Basic Business License.

Major license categories:

• Beauty & Grooming Services
• Charitable Services
• Employee/Independent Salesperson Licenses
• Employment Services
• Entertainment Services
• Flammable Product Sales & Services
• Food Services
• General Sales/Services Business
• Health Services
• Lodging
• Rental Housing
• Regulated Businesses

For each category, other than the last category (“Regulated Businesses”), the requirements are identical for all licenses in that category. However, the fee schedule may vary depending on the type of license.

All applicants for a Basic Business License (BBL) for a Residential Housing endorsement must register the number of rental units with the Department of Housing and Community Development's (DHCD), Rental Accommodations Division (RAD), as required by the Rental Housing Act of 1985.

When submitting the basic business license, $43/unit will be owed for rent control.

Rent Control

The rent control law is the Rental Housing Act of 1985 (DC Law 6-10) as amended (the Act), which is codified at DC Official Code § 42-3501.01 et seq. Under the Act, an apartment building or apartment complex is called a housing accommodation, and a single apartment or house is called a rental unit. A renter is simply called the tenant, but the landlord is called the housing provider.

The Rental Accommodations Division (RAD) administers the Act.

The Act applies to all rental housing accommodations in the District of Columbia. Certain parts of the Act, such as eviction protections, apply to all District tenants. Title II of the Act is rent stabilization, which applies to any non-exempt rental unit. All rental units must be registered with the RAD either as subject to rent control or exempt from rent control. For any unit that is not registered with RAD, rent control automatically applies.

The most common exemptions from rent control are for rental units that are:

• Federally or District-subsidized
• Built after 1975
• Owned by a natural person (i.e., not a corporation) who owns no more than four rental units in the District
• Vacant when the Act took effect

District of Columbia Housing Regulations

The District’s housing regulations apply to rental as well as non-rental housing in the District of Columbia. They set forth a broad range of legal rights that tenants have, and the steps that tenants need to take to exercise those rights. The relevant Title of the District of Columbia Municipal Regulations (DCMR) is Title 14. Title 14 has 97 chapters, some of which are reserved for later use, and which cover topics such as:

• How the housing regulations are to be enforced;
• The rules for housing business licensing;
• Various aspects of landlord and tenant relations, including illegal lease provisions and security deposits;
• The housing code criteria as to whether the accommodation is being properly maintained and kept in good repair;
• Requirements that apply to specific types of housing -- apartment buildings, rooming houses, boarding houses, and hotels and motels;
• Certificate of Occupancy requirements;
• How and when the District may abate housing code violations;
• Various government housing programs;
• Rules implementing the provisions of the Rental Housing Act of 1985, including:
• Rent control;
• Tenant evictions and landlord retaliation;
• Tenant relocation assistance;
• The roles of the Rent Administrator and the Rental Housing Commission; and
• The procedure for rental housing cases;
• Rules implementing the Rental Housing Conversion and Sale Act of 1980, including:
• The right of tenants to determine whether or not to convert the building to condos or a cooperative; and
• The tenant right of purchase;
• The process for establishing a “tenant receivership” when the landlord fails to keep the building in good repair; and
• The requirements regarding “reasonable accommodations” for persons with disabilities.