The short answer is yes, and we’re glad you asked! This is a question we don’t hear often enough, and many people make costly assumptions in this area. At a minimum, you must cancel your Basic Business License and business tax registration. Depending on your situation, you may also need to dissolve your Business Entity Registration.
Cancel Your Basic Business License
It’s crucial to cancel your license before its expiration date. Otherwise, the District will impose a $250 penalty the day after your license expires. If the license remains expired for 30 days, an additional $250 penalty will be applied. Even worse, further penalties may be imposed if your license stays in lapsed status.
Why is this important?
Your business license is tied to your Social Security number, ITIN, or EIN, meaning the D.C. government can garnish your tax refunds or send you to collections. Avoid this unnecessary hassle by canceling your license on time.
Canceling your license is simple and can be done online. For step-by-step instructions, check out our guide: How to Cancel My DC Rental Property License.
Cancel Your RentJiffy Registered Agent Service
If you use RentJiffy as your registered agent and this is your only property associated with the service, you’ll need to close this account as well. For detailed instructions, refer to: How Do I Cancel My Registered Agent Services with RentJiffy?.
Close Your Business Tax Accounts
As part of applying for your rental housing license (aka Basic Business License), you were registered for business tax accounts with the Office of Tax and Revenue. Now, you must close these accounts to avoid penalties.
If you don’t close your accounts, the Taxing Authority will assume you’re still in business and wonder why you haven’t filed tax returns. This can lead to penalties or even an audit. DC already collects enough revenue—don’t risk unnecessary penalties. And let’s be honest, no one has time for an audit!
To close your account(s):
- You must file a final tax return for each tax account type you have—even if you don’t owe any taxes.
- Consult your tax professional to ensure all required filings are completed.
- Alternatively, you can contact the DC Office of Tax and Revenue’s Business Tax Division at (202) 727-4829 for more information.
Taking these steps now can save you from unexpected fines and compliance issues later.
If the property is owned by a Business Entity or Business/Statutory Trust
Close the Business Entity Registration
If your rental property is owned by a business entity—such as an LLC, Corporation, or Statutory Trust— and you no longer plan to operate the business, you must file Articles of Dissolution with the Department of Licensing and Consumer Protection (DLCP) Corporations Division.
Before proceeding, consult with your legal counsel to determine whether dissolution is the right step or if you have legal obligations that require keeping the business registration active. Ceasing rental operations does not automatically mean you can dissolve your business entity, so it’s essential to get professional guidance before making any decisions.