...
By Jasmine Laws
Reporter
0
Share
Newsweek is a Trust Project member
See more of our trusted coverage when you search.Prefer Newsweek on Googleto see more of our trusted coverage when you search.
Workers in Washington, D.C., many of whom have federal roles, could be set to experience major disruption over their tax returns this year, as Congress seems likely to pass a joint resolution that would override the district's tax law—n the middle of the tax season.
The expected move has been described as "nothing short of administrative and fiscal sabotage" by Congresswoman Eleanor Holmes Norton, a D.C. Democrat, as it is set to bring chaos to the tax filing season for more than 300,000 tax payers.
Why It Matters
According to a 2025 tax fact sheet from the D.C. Office of Revenue Analysis, there are around 361,757 tax filers in the capital.
Read More on News
Many of these filers are also federal staff. In November 2025, almost 23 percent of all workers in Washington, D.C. were employed by the federal government—which is actually low for the district. In August 2010, the capital’s share of federal employment was at almost 30 percent, according to usafacts.org.
...
D.C.'s 'Joint Resolution'
There are two resolutions hoping to secure votes this week: a House resolution by GOP Representative Brandon Gill of Texas to disapprove the district.'s approval of the D.C. Income and Franchise Tax Conformity and Revision Temporary Amendment Act of 2025, and a similar Senate resolution, which have joined together to form what is being referred to as the "Joint Resolution."
The capital had passed the temporary legislation—the D.C. Income and Franchise Tax Conformity and Revision Temporary Amendment Act of 2025—in December to decouple D.C.'s tax law from parts of the 2025 federal tax law brought in by President Donald Trump's sweeping tax package in the summer of 2025, something more than 10 states have also done.
The Joint Resolution would undo the decoupling of D.C's tax law, as it would force the capital to "conform to federal tax laws [and] would therefore prevent the expansion and creation of tax credits that are proven to be effective in reducing poverty," Megan Curran, a policy director at the Center on Poverty and Social Policy at Columbia University, and Ryan Vinh, a research analyst at the center, told Newsweek.
They added that they modeled the impacts of the expansion on child tax credits and earned income tax credits, implemented in D.C.'s December legislation, and found that the measures had the potential to cut child poverty by around 20 percent.
"A rule that repeals the expansion and creation of these credits would be a setback for meaningfully reducing child poverty in D.C.," they said.
Child tax credits are designed to support families with the cost of raising children, while earned income tax credits help boost families working for low wages.
Both credits are "key anti-poverty policies, and decades of research have demonstrated the ways in which they can boost parent and child health and well-being in the short term and provide long-term health, education, employment, and economic benefits," Curran and Vinh said.
When asked about the new resolution, a House Committee on Oversight and Government Reform spokesperson told Newsweek: "Many states and local tax jurisdictions operate as a rolling conformity jurisdiction by automatically adopting the federal tax code into their local tax code."
"The D.C. Council’s actions are nothing more than a disingenuous cash-grab at the expense of American taxpayers, service workers, and businesses," they added.
They said that the new resolution "gives D.C. residents and businesses the same opportunity as the rest of the country to experience the full benefits and financial relief this historic tax reform brings without them having to worry about overly complicated administrative and compliance procedures when filing their taxes."
Impacts on the Tax Season
As the House Committee on Oversight and Government Reform is looking to disapprove that temporary legislation, it will likely mean that income tax-filing deadlines are suspended into the fall, the District of Columbia’s chief financial officer Glen Lee warned congressional leaders on Monday.
Lee said in his letter that the enactment of the Joint Resolution would "disrupt the district’s ability to collect income tax
revenues associated with annual income tax filings due by April 15, 2026."
As the implementation of measures in D.C.'s amendment act "required substantial changes to [Office of Tax and Revenue (OTR)]’s systems and taxpayer forms," the implementation of the Joint Resolution would mean that the district's tax forms would "no longer be consistent with district law," Lee said.
Implementing the resolution would therefore require an update to OTR's forms, schedules and instructions, changes to the tax processing system, and changes to software of tax processing vendors, he added.
"For the current filing season, OTR managers estimate that adjustments will likely require several months, which would extend district income tax filing deadlines into fall 2026," Lee said.
What People Are Saying
Congresswoman Eleanor Holmes Norton, a D.C. Democrat, said on Monday: “D.C. is hardly an outlier in decoupling parts of its local tax code from the federal one. Nearly half the states, red and blue alike, have decoupled their states’ tax codes from portions of the federal tax code. Congress has never overturned a revenue-raising law for D.C. Doing so now would threaten D.C.’s credit rating, sow chaos in the middle of tax filing season, and will likely force the district to halt filings while scrambling to rewrite forms and guidance. This is not governance or oversight. It is sabotage, and the damage would be severe and intentional."
**Kamolika Das, local policy director for the Institute on Taxation and Economic Policy (ITEP) and Aidan Davis, ITEP’s state policy director, told Newsweek: "**In a structural sense, this is clearly sabotage of democratic governance and fiscal planning. While Congress does have the legal authority to exert some level of control, this move is extremely irresponsible and would deliberately upend D.C.’s ability to govern itself, plan its budget, and administer a working tax system. At this point, D.C. has already built its revenue forecast and based spending commitments on that forecast. A rule like this would send D.C. into administrative chaos, significant revenue loss, increased inequality, far less funding for key services, and long-term damage in terms of D.C.’s ability to govern itself."
She added: "Operationally, overriding D.C.’s tax law in the middle of tax season would cause widespread confusion, likely leading to higher error rates, delayed refunds, and major new administrative costs. Fiscally, the rule would be devastating for D.C.’s most vulnerable populations."
She further said: "D.C. is afforded the right to determine which policies they want to conform to when Congress passes a major tax bill, and in this case, Congress would be interfering with people's lives whom they were not elected to represent. At a deeper, institutional level, the rule weakens democratic self-government and undermines the legitimacy of local policymaking and creates a chilling effect on future reforms."
Bradley Hardy, a professor of public policy at Georgetown University told Newsweek: "This could be harmful for many D.C. families. State and local governments target these refundable tax credits to help working families with low incomes. These tax credits help families that struggle with affordability, and many states and cities across the nation have enacted similar economic supports. It is important that state and local governments retain the flexibility to provide economic assistance to families struggling with affordability."
What Happens Next
The resolution is set to be considered by the Rules Committee on Tuesday at 4 p.m. Eastern Time. Americans are able to view the livestream of the meeting on rules.house.gov.
House Republicans are expected to vote this week on the House resolution, while the Senate is expected to hold a markup on Wednesday on the House measure and the Senate resolution, and it seems likely that Congress will look to pass the resolution, as it has been trying to tighten the leash on the capital in recent years, according to local advocates.
In a polarized era, the center is dismissed as bland. At Newsweek, ours is different: The Courageous Center—it's not "both sides," it's sharp, challenging and alive with ideas. We follow facts, not factions. If that sounds like the kind of journalism you want to see thrive, we need you.
When you become a Newsweek Member, you support a mission to keep the center strong and vibrant. Members enjoy: Ad-free browsing, exclusive content and editor conversations. Help keep the center courageous. Join today.
View 0 Comments
Submit Correction
View Editorial & AI Guidelines