District of Columbia minimum wage in 2026 (and 2027)

July 1 is the date that matters in DC

The District changes its rate mid-year. For 2026 that means two figures:

• January 1 to June 30, 2026: $17.95 an hour
• From July 1, 2026: $18.40 an hour (tipped cash wage $10.30)

DOES announces each new rate in a published notice ahead of the change. A payroll that still uses $17.95 after July 1 underpays by $0.45 an hour, $18.00 per 40-hour week per worker. Overtime is due at 1.5 times the regular rate after 40 hours a week.

Tipped workers in the District

DC restaurants can pay tipped staff a cash wage of $10.30 an hour from July 1, 2026, with tips covering the remaining $8.10 to reach $18.40. If a server's tips fall short in a week, the employer pays the gap. Confirm the tipped figure on the DOES notice each year, since it changes on July 1 along with the main rate. Our restaurant payroll software comparison covers tools that track tip shortfalls.

$18.40 an hour as annual pay

• $18.40 x 40 hours = $736.00 a week
• $18.40 x 2,080 hours = $38,272.00 a year
• $38,272.00 / 12 = $3,189.33 a month

The gap with the suburbs is wide. Maryland's statewide minimum is $15.00, and Montgomery County sets its own higher rates, while Virginia's minimum wage is $12.77 in 2026. A business with workers on both sides of the line must pay DC's rate for hours worked in the District, wherever the company or the worker is based.

Employer taxes on a DC minimum wage worker

For one full-time employee at $38,272.00, a new DC employer pays:

• FICA, 7.65%: $2,927.81
• FUTA, 0.6% on $7,000: $42.00
• DC unemployment, new employer 2.7% (or the prior-year average employer rate if higher) on the $9,000 wage base: $243.00 at 2.7%
• DC Paid Family Leave, employer-paid 0.75% of wages: $287.04

Total $3,499.85 on top, $41,771.85 all in. The paid family leave tax is an employer-paid tax, not a deduction from the worker's pay. A 0.2% administrative funding assessment on the unemployment wage base is reported by a secondary source (Bloomberg Tax, January 28, 2026), which would add $18.00. See DC payroll taxes for registration with DOES and the Office of Tax and Revenue.

Running DC payroll

DC payroll has three moving parts each year: the July wage change, the tipped wage and the paid family leave tax. A payroll service with DC support handles the filings. Gusto's Simple plan is listed at $49 a month plus $6 per person (checked October 16, 2026). Compare it in our payroll software rankings and check what payroll companies charge before choosing.

For a quick estimate at other wages, use the employee cost calculator; for every state's rate, see the 2026 minimum wage table.