From what I gathered via a little online research, "dort" more specifically means "(over) there" and da is "there" and sometimes "here" (depending on context) in general.
That's probably why Duolingo's preferred translation for this sentence is "It is over there" even though "It is there" is accepted.
I read it somewhere-" Generally, if 'hier', 'da' and 'dort' are used to designate place of varying distance, then - 'hier' refers to closest proximity - 'da' refers to a larger distance from the speaker - 'dort' indicates largest distance.
Imagine you talk to someone within an interesting park full of interesting features.
'Hier stand die alte Mauer der Stadt, da war der Wachturm, und dort (drüben) war das alte Rathaus'
However, nobody takes it as strict. In particular, 'da' and 'dort' are often used interchangably. These rules do not cover idiomatic usage (e.g. phrases like 'hier und da'), or you may completely dismiss the distance rules if you refer to a couple of locations and don't want to repeat the same word over and over again."