Summary
DC's standard deduction for 2025 should use the pre-OBBBA base amount ($30,000 MFJ) rather than the OBBBA-increased amount ($31,500 MFJ). PE currently uses the federal standard deduction ($34,700 for joint elderly), but DC Calculation G-1 on Form D-40 shows a base of $30,000 + $3,200 elderly additional = $33,200.
For a joint elderly couple with ~$1.8M income (2025):
dc_standard_deduction (PE): $34,700- DC Calculation G-1 (TaxAct): $33,200
- Difference: $1,500 (the OBBBA standard deduction base increase)
This is the same class of OBBBA non-conformity issue as SC (#7854).
Root Cause
PE's DC standard deduction inherits the federal value, which for 2025 includes the OBBBA $1,500 increase to the MFJ base ($30,000 → $31,500). DC has not adopted this increase.
Integration Test
- name: taxsim_810_dc_joint_elderly_2025_standard_deduction
absolute_error_margin: 1
period: 2025
input:
people:
person1:
age: 65
employment_income: 1_779_325
taxable_interest_income: 5_467
taxable_private_pension_income: 5_516
is_tax_unit_head: true
person2:
age: 67
employment_income: 20_000
taxable_interest_income: 5_467
taxable_private_pension_income: 5_516
is_tax_unit_spouse: true
child1:
age: 8
child2:
age: 15
tax_units:
tax_unit:
members: [person1, person2, child1, child2]
premium_tax_credit: 0
families:
family:
members: [person1, person2, child1, child2]
spm_units:
spm_unit:
members: [person1, person2, child1, child2]
snap: 0
tanf: 0
households:
household:
members: [person1, person2, child1, child2]
state_fips: 11
output:
dc_standard_deduction: 33200Note
PE also correctly optimizes DC joint vs separate filing (choosing separate when it saves tax). This is valid DC behavior — the D-40 allows "married filing separately on same return." TaxAct filed jointly ($176,245 tax) while PE files separately ($174,440). This optimization is not a bug, but it means DC income tax won't match TaxAct directly for unequal-income couples even after fixing the standard deduction.
References
Summary
DC's standard deduction for 2025 should use the pre-OBBBA base amount ($30,000 MFJ) rather than the OBBBA-increased amount ($31,500 MFJ). PE currently uses the federal standard deduction ($34,700 for joint elderly), but DC Calculation G-1 on Form D-40 shows a base of $30,000 + $3,200 elderly additional = $33,200.
For a joint elderly couple with ~$1.8M income (2025):
dc_standard_deduction(PE): $34,700This is the same class of OBBBA non-conformity issue as SC (#7854).
Root Cause
PE's DC standard deduction inherits the federal value, which for 2025 includes the OBBBA $1,500 increase to the MFJ base ($30,000 → $31,500). DC has not adopted this increase.
Integration Test
Note
PE also correctly optimizes DC joint vs separate filing (choosing separate when it saves tax). This is valid DC behavior — the D-40 allows "married filing separately on same return." TaxAct filed jointly ($176,245 tax) while PE files separately ($174,440). This optimization is not a bug, but it means DC income tax won't match TaxAct directly for unequal-income couples even after fixing the standard deduction.
References