The Federal Historic Preservation Tax Incentives program encourages private sector investment in the rehabilitation and re-use of historic buildings. It creates jobs and is one of the nation's most successful and cost-effective community revitalization programs. It has leveraged over $84 billion in private investment to preserve 42,293 historic properties since 1976. The National Park Service and the Internal Revenue Service administer the program in partnership here in Maine with the Maine Historic Preservation Commission, our State Historic Preservation Office.
20% Tax Credit
A 20% income tax credit is available for the rehabilitation of historic, income-producing buildings that are determined by the Secretary of the Interior, through the National Park Service, to be “certified historic structures.” The Maine Historic Preservation Commission and the National Park Service review the rehabilitation work to ensure that it complies with the Secretary’s Standards for Rehabilitation. The Internal Revenue Service defines qualified rehabilitation expenses on which the credit may be taken. Owner-occupied residential properties do not qualify for the federal rehabilitation tax credit. Learn more about this credit before you apply.
Each year, the National Park Service's Technical Preservation Services approves approximately 1200 projects, leveraging nearly $6 billion annually in private investment in the rehabilitation of historic buildings across the country. Learn more about this credit: Historic Preservation Tax Incentives.
Federal Tax Credit Basics
- The amount of credit available under this program equals 20% of the qualifying expenses of your rehabilitation.
- The tax credit is only available to properties that will be used for a business or other income–producing purpose, and a "substantial" amount must be spent rehabilitating the historic building.
- Your building needs to be certified as a historic structure by the National Park Service.
- Rehabilitation work has to meet the Secretary of the Interior’s Standards for Rehabilitation, as determined by the National Park Service.
Before applying, consult your accountant or tax advisor to make sure that this federal tax credit is beneficial to you. Certain income and other restrictions may have a bearing on whether an owner is able to use the credit. IRS administers the Department of the Treasury’s involvement with the Federal Historic Preservation Tax Incentives Program. The IRS has provided written guidance on these complex federal regulations which is available as easy-to-read guidance in IRS Info.
The tax incentives program is administered by the National Park Service (NPS) and the Internal Revenue Service (IRS) in partnership with the State Historic Preservation Office. Each plays a specific role:
Maine Historic Preservation Commission
- Serve as first point of contact for property owners.
- Provide application forms, regulations, information on appropriate treatments, and technical assistance.
- Maintain records of buildings and districts listed in the National Register of Historic Places, as well as state and local certified historic districts.
- Assist anyone wishing to list a building or a district in the National Register of Historic Places.
- Advise applicants on rehabilitation projects and make site visits.
- Make certification recommendations to the National Park Service.
National Park Service
- Reviews applications for conformance with the Secretary of the Interior’s Standards for Rehabilitation.
- Issues certification decisions in writing.
- Transmits copies of all decisions to the IRS.
- Publishes program regulations, the Secretary of the Interior’s Standards for Rehabilitation, the Historic Preservation Certificat ion Application, and information on rehabilitation treatments.
Internal Revenue Service
- Publishes regulations on qualified rehabilitation expenses, time periods for incurring expenses, and all other financial matters concerning the 20% tax credit.
- Answers inquiries on financial aspects of the program, and publishes an audit guide to assist owners.
- Audits taxpayers to ensure that only parties eligible for the 20% tax credits use them.