In December 2017, Congress passed the Tax Cuts and Jobs Act of 2017, which kept intact the 20% Historic Tax Credit (HTC) program, while eliminating the 10% older building tax credit provision.
The Act also modified the terms under which owners could realize the tax credit, which previously could be claimed in whole once a project was completed.
The tax credit must now be claimed at a rate of 4% annually over a five-year period. Although this change somewhat reduces the value of the tax credit to investors, the HTC program still provides significant financial incentives to investors.
Over the next few weeks, I’ll be describing this and other changes in detail in a series of blog posts and a guide. Today, I’d like to give you the lay of the land and give you a sense of what’s at stake.
In small towns, large cities and other communities across the country, people are standing in front of aging buildings, some beloved local landmarks, some seemingly obsolete, and others simply worn out. Many concerned owners and communities are wondering what do to with these neglected resources and how to pay for the work involved.
Since 1976, more than 40,380 such buildings have been given new life using federal historic tax credits to help with project financing, and in the process are transforming the built environment and instilling a new sense of pride and vitality in communities large and small.