District of Columbia amends withholding regulations

The District of Columbia has issued revised withholding regulations. The regulations align with the previously reported change from monthly to quarterly withholding returns. Further, the regulations address the general withholding provisions, payment of withholding tax and annual report of withholding.

The section on the withholding returns now states that until notified otherwise by the Deputy Chief Financial Officer of the District of Columbia Office of Tax and Revenue (DCFO):

• employers or entities registered for withholding prior to January 1, 2017 and not previously assigned to an annual reporting period must file quarterly returns;
• employers or entities assigned to an annual reporting period prior to January 1, 2017 are not required to file quarterly returns; and
• employers or entities registered for withholding on or after January 1, 2017 must file quarterly tax returns.

The previously announced withholding changes did not impact the general requirement that payments of taxes withhold from wages made on a monthly basis. However, the revised regulations state that employers or entities registered for withholding on or after January 1, 2017 must make quarterly tax payments, unless the payment period is changed by the DCFO. Employers or entities registered for withholding prior to January 1, 2017 must continue to pay withholding taxes at the same frequency as previously required, unless the payment period is changed by the DCFO. (District of Columbia Office of Tax and Revenue, Reg. Secs. 130, 132, 133, 135, DCMR, adopted January 13, 2017, effective February 3, 2017.)

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