As a result of the Superior Court of the District of Columbia’s (Tax Division) recent ruling that a District of Columbia law unconstitutionally denied out-of-state charities a hotel and sales tax exemption, eligible nonprofit organizations are entitled to obtain a refund of the sales and hotel taxes paid for meetings or events held in DC since December 12, 2016, plus interest. With hotel and sales tax rates currently at 14.95% and 6% respectively, the amount of a refund could be significant. However, the deadline to submit a claim to obtain a refund of taxes paid is June 6, 2025.
Specifically, the court found that DC’s law that gave “semipublic institutions”, defined as “any corporation, and any community chest, fund, or foundation, organized exclusively for religious, scientific, charitable, or educational purposes, including hospitals, no part of the net earnings of which inure to the benefit of any private shareholder or individual” with an office in DC a hotel and sales tax exemption but denied an exemption to semipublic institutions without an office in DC, violated the U.S. Constitution’s Commerce Clause. American Philosophical Association, et al., v. District of Columbia, Tax Division No. 2019 CVT 000003.
Is Your Nonprofit Eligible?
Organizations that can demonstrate the following may be eligible for a refund of hotel and sales tax paid for events held in DC, plus interest:
- The organization does not have an office within DC and is a “semipublic institution,” which is defined as “any corporation, and any community chest, fund, or foundation, organized exclusively for religious, scientific, charitable, or educational purposes, including hospitals, no part of the net earnings of which inure to the benefit of any private shareholder or individual.” Note that organizations recognized as tax-exempt under § 501(c)(3) of the Internal Revenue Code meet this definition.
- The organization held a meeting or event in DC from December 12, 2016, through the present and paid sales and/or hotel taxes at one of the following hotels: The Washington Hilton, the Marriott Marquis, the Renaissance Washington, the Omni Shoreham Hotel, the Grand Hyatt Hotel, the Mayflower Hotel, the Hyatt Regency, the JW Marriot, the Capital Hilton, the Willard Intercontinental, the Marriott Wardman Park Hotel, the Fairmont, the Mandarin Oriental, the Watergate Hotel, the Hilton D.C. National Mall Hotel, the Marriott Georgetown, the Washington Marriott at Metro Center, and the Westin Washington City Center. [Note: If your organization held an event or meeting at a DC hotel not listed here, it is recommended that a refund claim still be made if it otherwise meets the requirements, but indicate that the hotel is not one of the 18 listed].
How to Apply
Eligible organizations must complete a claim form and mail it with a postmark of no later than June 6, 2025, or submit it online by June 6, 2025, to receive a refund. Claim forms can be found here. You can visit District of Columbia Tax Refund Class Action | Home (dctaxrefundclassaction.com) for more information. If an organization does not timely submit a refund request by June 6, 2025, it will not be eligible to receive a refund.
Additional Points
An organization is not limited to applying for a refund for only one event or meeting; if the organization had multiple events since December 12, 2016, it can request a refund for as many events or meetings as are eligible.
If your organization hosted a meeting or event at a hotel that is not one of the 18 hotels listed in the class certification, it is recommended that a refund claim still be submitted if otherwise eligible, noting that the hotel is not one of the hotels listed.
Eligible organizations without a DC office planning to have an event or meeting in DC should now consider applying for exemption from sales/hotel tax to avoid the hefty 20.95% tax.
The Associations, Nonprofits and Political Organizations practice group at Whiteford has in-depth experience advising clients with regard to hotel and sales tax exemptions.
