Office of Tax and Revenue (OTR) Collections Division overseas delinquent taxpayer accounts. If full payment is not received within 15 days on an initial balance due notice, OTR send a notice of enforcement by certified mail to your last known address. It is important to read all Correspondence from OTR as these Notices contain important dates and information that may affect your rights. If you do not respond to letters or notices and your account continues to be delinquent, it is then assigned to a Revenue Officer for collection. Occasionally, OTR may outsource enforcement to third party Collection Agencies, the most common being MuniServices.
If a taxpayer cannot pay their balance in full, OTR will allow them to pay in installments, generally not to exceed 24 months (MuniServices may accept longer). Interest continues to accrue and taxpayers are expected to pay their current taxes concurrently. If installment payments are not made timely, OTR may collect the taxes due by seizing wages or bank accounts. Once an installment agreement is reached, a lien determination will be made. Any state and federal refunds are subject to interception and will be applied to outstanding tax liabilities.
OTR may file a tax lien covering all tax debt, recorded at the District’s Recorder of Deeds office, where it becomes public record and appears on your credit report. This enables the District to seize property (bank accounts, wages, and personal property) to pay the debt. A tax lien can appear on a taxpayer’s credit history for 10 years, even after the debt is marked paid in full.
OTR may waive or cancel delinquent return penalties if you show reasonable cause, defined as your exercising ordinary business care and prudence in the execution of your tax obligations, but some uncontrollable outside event (such as incapacitation or loss of records) prevented you from complying. The request should be submitted in writing and include any supporting documentation and explain the circumstances that caused your return to be late. Generally, OTR does not abate interest charges unless there is a considerable delay on the part of the District.
OTR has a Voluntary Disclosure Program encouraging businesses and individuals that are not in compliance with District tax laws to voluntarily come forward to bring their accounts into compliance. You are eligible for the program only if you have not received a Notice in the past regarding your particular tax issue. If you are accepted in the program, OTR will waive civil penalties if the tax and interest is paid in full, with a lookback period of generally 3 years.