FEDERAL REHABILITATION TAX CREDIT

The Federal Historic Preservation Tax Incentives program is the largest Federal program that specifically supports historic preservation and is one of the nation's most effective programs to promote historic preservation and community revitalization.

The National Park Service is the federal agency that administers the program, and the AHC is the point of contact for anyone who applies for tax credits for properties in Alabama. The Historic Preservation Certification Application must be submitted (in duplicate) to the AHC to certify that the property is eligible for the program and that proposed work meets historic rehabilitation guidelines.

  • Properties must be listed in the National Register of Historic Places. Part 1 of the application determines if the property is eligible for the program.
  • Properties must be income-producing after rehabilitation.
  • Rehabilitation expenditures must be substantial.
  • Rehabilitation work must follow the Secretary of the Interior’s Standards for Rehabilitation. Part 2 of the application determines if proposed work follows preservation guidelines. Part 3 is submitted after completion of the project.
  • Properties must remain income-producing for five years.

Applicants meeting these requirements may earn an income tax credit that equals 20% of qualified rehabilitation expenditures. Property owners interested in these tax credits are advised to consult an accountant, tax attorney, or other professional tax adviser, legal counsel, or the Internal Revenue Service to ensure this program is beneficial to them.

Visit the National Park Service website for more information www.nps.gov/tps/tax-incentives.htm.

CONTACT

For more information about the Federal Historic Preservation Tax Incentives program, contact Chloe Mercer at

334-230-2669 or chloe.mercer@ahc.alabama.gov.

NOTICE

On December 22, 2017, Public Law No: 115-97 was signed and enacted, amending the Internal Revenue Code to reduce tax rates and modify policies, credits, and deductions for individuals and businesses. Section 13402 modifies the 20% Historic Rehabilitation Tax Credit, repeals the 10% Rehabilitation Tax Credit for non-historic buildings, and provides transition rules for both credits. These and other changes to the Internal Revenue Code may affect a taxpayer’s ability to use the 20% tax credit. See Public Law 115-97 for details.