Sens. Collins, Cardin Introduce Historic Tax Credit Improvement Act

Published by Michael Novogradac on Wednesday, March 9, 2016 - 12:00am

Sens. Ben Cardin, D-Md., and Susan Collins, R-Maine, are expected to introduce today the Historic Tax Credit Improvement Act of 2015. The legislation is very similar to H.R. 3846, introduced Oct. 28 in the House but not identical.

The legislation would expand and improve the historic tax credit (HTC) by:

  • increasing the HTC percentage for certain small projects to 30 percent, from 20 percent;
  • allowing “certification” of the HTC for certain small projects, which would allow direct sales of the HTC;
  • lowering the rehabilitation expenditure threshold to qualify for the HTC from 100 percent to 50 percent of adjusted basis;
  • reducing the depreciable basis adjustment from claiming the HTC from 100 percent to 50 percent of the HTC;
  • eliminating any current federal income taxation of proceeds received from sales or allocations of state historic tax credits; and
  • relaxing certain tax-exempt use property rules.

One key difference from the H.R. 3846 is that the Senate bill does not include a provision that would allow functionally related buildings to be treated as separate properties.

Read more about how the Historic Tax Credit Improvement Act would modernize the HTC and improve the nation’s already proven and essential financing tool for historic preservation in this earlier post.