Federal Historic Preservation Tax Credit
The Federal Historic Preservation Tax Credit is a tax incentive program in the United States designed to encourage the rehabilitation of historic buildings. Property owners who invest in the restoration of certified historic structures may receive a tax credit equal to a percentage of the qualified rehabilitation expenses incurred during the renovation.
The credit is typically set at 20% for income-producing properties and is applicable to both commercial and residential projects that meet specific criteria established by the National Park Service and the Internal Revenue Service. To qualify, the property must be listed on the National Register of Historic Places or be located in a registered historic district.
For example, if a developer spends $1 million on the rehabilitation of a historic building, they may be eligible for a tax credit of $200,000, which can be used to offset federal income tax liabilities.
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