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Historic Tax Credits News Briefs – April 2019

Virginia Gov. Ralph Northam signed legislation Feb. 15 to reinstate a $5 million annual taxpayer cap on the state historic tax credit (HTC), effective July 1. H.B. 2705 passed the House by a 94-2 vote and the Senate by a 25-15 margin. A $5 million cap was in effect for 2017 and 2018, but expired Jan. 1. The bill is available at www.historictaxcredits.com.

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New regulations concerning the review process for qualified residential structures under the Colorado state HTC were effective March 17. The regulations were adopted to ensure that taxpayers receive prompt, consistent reviews of proposed and completed rehabilitation work and that tax credit certificate reporting is timely and complete. The regulations provide the review process for the state historic preservation office, State Historical Society of Colorado and certified local governments as reviewing entities. The Colorado HTC is available through 2029.

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Legislation introduced in Connecticut would provide an exemption for buildings in opportunity zones (OZs) and in distressed municipalities from compliance with certain historic preservation requirements. H.B. 6552 would exempt individuals who wish to alter a historic building in an OZ from the full process in the state code for historic renovation. It would also exempt distressed cities that have been unable to alter a historic building for five years or more. The bill was assigned to the Joint Planning and Development Committee.

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Legislation was introduced Feb. 7 in both houses of the Tennessee Legislature to create a state HTC. H.B. 1063 (and S.B. 1053) would create an HTC worth 10 percent of qualified rehabilitation expenditures for properties in Davidson or Williamson counties; 20 percent for structures in Hamilton, Knox or Shelby counties; and 30 percent for all other certified historic structures. A 5 percent bonus would be available for structures in a specially designated area outside the 10 percent and 20 percent counties that isn’t a county seat. The project cap would be $4 million and the annual state cap would be $40 million. Tennessee has no state income tax, so the transferrable HTC would be taken against franchise tax and excise tax on businesses. Copies of each bill are available at www.historictaxcredits.com.

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The Illinois Department of Revenue released March 5 a decision that its River Edge Historic Preservation Tax Credit can’t be transferred, but that a taxpayer can file an amended state tax return to claim the credit within three years of the extended due date of the original return. The Department of Revenue ruled that transfers are not specifically authorized in the legislation that created the credit, so credits cannot be allocated to people who weren’t partnership members the year the credit-related expenses were incurred. The decision is available at www.historictaxcredits.com.

Journal Category:

Historic Tax Credits

Authors:

Novogradac

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