Historical Preservation Tax Incentives

From a social standpoint, there’s significant value in the preservation and rehabilitation of historically significant properties. Thanks to the Federal Historic Preservation Tax Incentives program, also known as Historic Tax Credits (HTC), there can be a substantial financial benefit as well.

Get to Know HTCs: The Basics

Rehabilitation and preservation work made to income-producing, qualifying properties can benefit investors and developers to the tune of 20% of qualified rehabilitation expenditures. The only requirement is that applicants satisfy the conditions of the program as it is administered by the National Park Service (NPS).

Marcum’s experienced team has decades of experience assisting clients pursuing tax credits relating to the rehabilitation and renovation of historically significant properties.

The Historical Tax Credit Application Process

The federal HTC program is a three-phase process for receiving Historical Tax Credits from the federal government is straightforward. It involves:

1. Establishing the historical significance of a property;
2. Approval of proposed preservation or rehabilitation work; and
3. Approval, by the NPS, confirming that the completed rehabilitation or preservation work aligns with the proposal that was approved in step two.

Each phase is subject to certain regulations. For example, to confirm a property’s historical significance, the applicant must prove that the property is located within a “historic district” and is historically significant to the district or is included on the National Register of Historic Places.

Local consultants with knowledge of the area’s history and that of its buildings are often instrumental in helping applicants navigate the first phase. Ultimately though, the National Parks Service is responsible for determining which properties qualify based on their applications.

When applying, careful attention must be made to the inclusion of evidence supporting a building’s historical relevance. That’s one reason third parties with experience drafting successful applications often consult on HTC projects, they strengthen applications by researching and compiling evidence of a property’s historical value.

Marcum has a vast network of HTC clients and partners and is able to connect clients with someone who can advise on the preparation of an HTC application.

Which Properties Qualify

The National Park Service’s website features a map detailing areas and buildings that have been qualified as historically significant, and may offer useful insight into the types of properties that are certified.

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