Federal tax incentives are available for owners of an income producing historic property who carry out a substantial rehabilitation.
See the Federal Tax Incentives Program Fact Sheet for more.
Federal Rehabilitation Investment Tax Credit (RITC), 20 percent
A federal income tax credit equal to 20 percent of the project's qualified rehabilitation expenses available ONLY for income-producing properties. All properties must be listed in, or eligible for, the National Register of Historic Places, either individually or as part of a National Register Historic District. Project work must meet the Secretary of the Interior’s Standards for Rehabilitation.The application is first reviewed by the Historic Preservation Division (HPD), then forwarded to the National Park Service for review and approval. This program is available nationwide.
Federal Rehabilitation Tax Credit RITC, 10 percent
A federal income tax credit equal to 10 percent of the project’s qualified rehabilitation expenses is available for non-historic buildings placed in service before 1936. The building must be rehabilitated for non-residential use and must meet three criteria: at least 50 percent of the existing external walls must remain in place as external walls, at least 75 percent of the existing external walls must remain in place as either external or internal walls, and at least 75 percent of the internal structural framework must remain in place. There is no formal review process for rehabilitations of non-historic buildings.National Park Service Fact Sheet
Charitable Contribution Deduction
The charitable contribution deduction is taken in the form of a conservation easement, and enables the owner of a “certified historic structure” to receive a one-time tax deduction. A conservation easement ensures the preservation of a building’s facade by restricting the right to alter its appearance. Qualified professionals should be consulted on the matters of easement valuations and the tax consequences of their donation. To be eligible for the charitable contribution deduction, a property must be listed in the National Register of Historic Places, either individually or as a contributing building within a historic district. If located in a National Register Historic District, a Part 1 must be submitted to HPD for review and certification by NPS
The National Trust Community Investment Corporation – Provides information on various project financing options. There are also many for-profit limited liability companies (LLCs) that provide consulting services for developers, allowing them to monetize federal and state tax credits, thus creating project equity.
- Economic Impact of Federal Tax Credits (2015)
Who to contact:
Rachel Rice, Tax Incentives Program Manager