Once a property is deemed ‘historic’ by being listed either on the National Register of Historic Places individually or contributing to a historic district or is part of a Certified Historic District, a project can receive tax credits, which lowers the taxes owed, on qualified rehabilitation expenses if their work conforms to the Secretary of the Interior’s Standards for Historic Building Rehabilitation.
Facts about the Federal Historic Tax Credit
Over the life of the program, the historic rehabilitation tax credit (HTC) has:
- created nearly 2.5 million good paying, local jobs;
- leveraged more than $117 billion in private investment in our communities;
- generated a significant return on investment for the federal government;
- and preserved more than 40,000 buildings that form the historic fabric of our nation.
State VS Federal Tax Credit
(via Missouri Dept. of Natural Resources)
The state credits apply to income-producing property including either commercial or residential rental property, or personal residences that are certified historic structures and meet the minimum investment threshold. Missouri law provides an investment tax credit equal to 25% of approved costs associated with qualified rehabilitation made after Jan. 1, 1998.
The federal credits are limited to income-producing, depreciable property only. The property may be either commercial or residential rental property that is certified historic. A taxpayer’s personal residence would not qualify for the federal credit. (The 20% credit is available for properties rehabilitated for commercial, industrial, agricultural, or rental residential purposes, but it is not available for properties used exclusively as the owner’s private residence).
The federal and state credits can be used in combination for the rehabilitation of commercial or income-producing properties.
Click here to view the program page on the Missouri Department of Economic Development’s website, including the new rules, applications and other information.