Sean Urbany, CPA
On July 30, 2013, District of Columbia Mayor Vincent Gray signed the “Fiscal Year 2014 Budget Support Emergency Act of 2013.” Part of this legislation, the Out-of-State Municipal Bond Tax Repeal Emergency Act of 2013, repeals the 2011 law which required interest income from out-of-state municipal bonds acquired after January 1, 2013 to be included in determining DC taxable income for individuals, estates, and trusts.
Due to this new legislation, there will be no change from prior years in the way out-of-state municipal bond interest is taxed in DC as the 2013 tax year was the first year the new tax would have been in effect. Interest income earned by individuals, estates, and trusts on out-of-state municipal bonds will continue to be exempt from taxation in DC.
For more information, please visit the DC Office of Tax and Revenue website.