 |
D.C. Municipal Regulations (Last Updated: September 13, 2017) |
 |
Title 9. TAXATION AND ASSESSMENTS |
|
Chapter 9-1. INCOME AND FRANCHISE TAXES |
Section 9-124. ALLOCATION OF NON-BUSINESS INCOME
-
124.1Net rents and royalties from real property located in the District shall be allocable to the District.
124.2Net rents and royalties from tangible personal property shall be allocable to the District, as follows:
(a) To the extent that the property is utilized or located in the District; or
(b) In their entirety if the taxpayer's commercial domicile is in the District and the taxpayer is not taxable in the State in which the property is utilized.
124.3The extent of utilization of tangible personal property in the District shall be determined by multiplying the rents and royalties by a fraction, the numerator of which is the number of days of physical location of the property in the District during the rental or royalty period in the taxable year and the denominator of which is the number of days of physical location of the property everywhere during all rental or royalty periods in the taxable year.
124.4If the physical location of the property during the rental or royalty period is unknown or unascertainable by the taxpayer, the tangible personal property is utilized in the State in which the property was located at the time the rental or royalty payer obtained possession.
124.5Gains and profits and losses from sales or exchanges of real property located in the District, including capital assets, shall be allocable to the District.
124.6Gains and profits and losses from sales or exchanges of tangible personal property, including capital assets, by a taxpayer engaged in trade or business in the District shall be allocable to the District in the following instances:
(a) If the property had a situs in the District at the time of the sale; or
(b) If the taxpayer's commercial domicile is in the District and the taxpayer is not taxable in the State in which the property had a situs.
124.7Gains and profits and losses from sales or exchanges of intangible personal property, including capital assets, are allocable to the District if the taxpayer's commercial domicile is in the District.
124.8Interest and dividends from District sources are allocable to the District, except interest and dividends specifically excluded from tax under § 1 of Title 10 of the Act.
124.9Rents and royalties from patents, copyrights, trademarks, service marks, secret processes and formulas, goodwill, franchises, and other like property are allocable to the District, as follows:
(a) To the extent that the patent, copyright, trademark, service mark, secret process or formula, goodwill, franchise, or other like property is utilized by the payer in the District; or
(b) To the extent that the patent, copyright, trademark, service mark, secret process or formula, goodwill, franchise, or other like property is utilized by the payer in a State in which the taxpayer is not taxable and the taxpayer's commercial domicile is in the District.
124.10A patent is utilized in a State to the extent that it is employed in production, fabrication, manufacturing, or other processing in the State or to the extent a patented product is produced in the State.
124.11 A copyright is utilized in a State to the extent that printing or other publication originates in the State.
124.12Income from sales of tangible personal property to the United States by corporations and unincorporated businesses is from a District source and is allocable to the District unless the entity's principal place of business is located outside the District, and the property is delivered from outside the District for use outside the District.
124.13All other non-business income which is derived from sources within the District shall be allocable to the District.
124.14If income is allocable within and outside the District under this section, the expenses, losses, and other deductions arising from production of that income shall be similarly allocable.
124.15Losses incurred in any transaction entered into for the production of non-business income shall be allowed only to the extent that any profits from the transaction would be taxable under the Act.