D.C. Mun. Regs. tit. 26, r. 26-C2107
Matching funds, spent by or for the benefit of the account holder for a use permitted by the Act and approved by the administering organization, are exempt from taxation under District of Columbia law, provided that any money withdrawn from a matching funds account by an account holder for an unapproved use shall be taxed as income to the account holder.
Income earned on the deposits of the account holder in the opportunity account is earned income to the account holder and is subject to taxation by the District of Columbia.
Funds in an Opportunity Account, including accrued interest, and matching funds available to the account holder shall not be considered in the determination of whether the account holder is eligible to receive public assistance or benefits, or the determination of the amount of public assistance or benefits available to the account holder.
D.C. Mun. Regs. tit. 26, r. 26-C2107