Income on My Return?

The Subtractions from Income section allows taxpayers to reduce their District of Columbia taxable income by reporting certain types of income, deductions, or exclusions that are taxable on the federal return but are not taxable—or are partially deductible—for DC tax purposes.

Not all taxpayers will qualify for every subtraction. Review each category carefully and maintain any supporting documentation needed to substantiate the subtraction.

What Can Be Entered in the Subtractions from Income Section? ➖

Military Spouse Relief Act Income 🇺🇸

If a service member's legal residence is outside the District of Columbia and the service member and spouse are living in DC due to military orders, qualifying compensation earned by the nonmilitary spouse may be exempt from DC taxation.

Income Reported on a DC Franchise or Fiduciary Return 📊

If income included on your federal return was already reported and taxed on a DC Franchise Tax Return or DC Fiduciary Return, that income may be subtracted to help prevent double taxation.

DC and Federal Government Survivor Benefits 💙

Eligible taxpayers who are age 62 or older may subtract qualifying survivor benefits received as an annuitant survivor.

Note: Social Security benefits should not be included in this subtraction.

Disability Income Exclusion (Form D-2440) ♿

Taxpayers who received qualifying disability income that was included in federal gross income may be eligible to exclude all or part of that income from DC taxation.

Interest and Dividends from Form 8814 💰

Enter qualifying interest and dividend income reported on Form 8814 (Parents' Election to Report Child's Interest and Dividends) if eligible for subtraction on the DC return.

Employment Discrimination Awards ⚖️

Certain awards received as a result of unlawful employment discrimination may qualify for a subtraction.

Note: Front pay and back pay awards generally do not qualify for this subtraction.

Contributions to a DC College Savings Plan 🎓

Taxpayers may qualify for a subtraction for contributions made during the tax year to an eligible DC College Savings Plan.

• Up to $4,000 for most filers.
• Up to $8,000 for Married Filing Jointly taxpayers.

Exclusion for DC Disabled Residents 🏠

Qualifying disabled DC residents may be eligible for an exclusion of up to $10,000, subject to eligibility requirements.

DC Teacher Expenditures and Teacher Tuition & Fees 🍎

Eligible educators may subtract certain unreimbursed classroom expenses and qualifying education-related tuition and fees.

These expenses may include:

• Classroom supplies
• Professional development costs
• Other qualifying educational expenses

Loan Repayment Awards for Health Care Professionals 🩺

Certain loan repayment awards provided by the District of Columbia to eligible healthcare professionals may be excluded from DC taxable income.

These programs are intended to help healthcare professionals reduce educational debt while serving qualifying communities.

Health-Care Premiums Paid for a Non-Employee Domestic Partner ❤️

A taxpayer may subtract the value of qualifying health insurance premiums paid by an employer on behalf of a registered domestic partner or eligible same-sex spouse.

DC Poverty Lawyer Loan Assistance ⚖️

Certain loan assistance awards provided to attorneys serving the public interest may qualify for subtraction from DC income.

Eligibility is generally based on certification by the Office of the Attorney General.

Taxable State and Local Tax Refunds 🔄

If a state or local tax refund was included as taxable income on your federal return, that amount may generally be subtracted on the DC return.

Other Subtractions 📝

If you have income that is taxable federally but is specifically excluded from DC taxation, it may be entered as an Other Subtraction.

Examples may include:

• Income specifically exempt under DC law.
• Certain federally taxable benefits not taxed by DC.
• Other adjustments supported by DC tax instructions.

When entering an Other Subtraction:

• Enter the amount.
• Provide a clear description.
• Retain documentation supporting the subtraction.

Additional Notes 💡

• Most taxpayers will only qualify for a few of these subtraction categories.
• Enter only amounts that are specifically eligible under DC tax law.
• Incorrect subtraction entries may delay processing or affect the accuracy of your return.
• Keep records supporting any subtraction claimed in case additional information is requested.