Historic Tax Credits
Should you chose to rehabilitate a structure in a recognized historic district, or a structure which as been deemed historic, you may be eligible to apply for State and/or Federal historic tax credits. These credits can significantly reduce the cost of rehabilitating an existing building, and have played an important role in downtown Roanoke’s revitalization efforts.
Federal Rehabilitation Tax Credits
This program provides tax credits for qualifying historic properties used for income-producing purposes. A tax credit for 20% of the rehabilitation costs can be taken for historic properties on the National Register or contributing to a National Register Historic District. Substantial rehabilitation (minimum $5,000) must be undertaken in accordance with the Secretary of the Interior’s Standards for Rehabilitation and approved by the National Park Service.
In addition, a Federal Rehabilitation Tax Credit of 10% is available for non-historic buildings built before 1936, which are not on the National Register or contributing to an historic district. Certification by the National Park Service is not required. However, rehabilitation must meet the Secretary of the Interior’s Standards of Rehabilitation. Only commercial projects are eligible.
State Rehabilitation Tax Credits
This program provides tax credits for qualifying historic properties on the Virginia Landmarks Register, or properties certified by the Virginia Department of Historic Resources as contributing to an historic district or meeting the criteria for listing on the Register (National Register properties or districts are included on the Virginia Register). Rehabilitation expenses must be at least 50% of the prior assessed value of the building for local real estate tax purposes. Properties do not have to be income producing; residential rehabilitation by homeowners qualifies for the credits. A 25% Rehabilitation State Tax Credit is available.
The property must be rehabilitated according to the Secretary of the Interior’s Standards of Rehabilitation and certified by the Virginia Department of Historic Resources. A tax certificate is issued.
For more information on State and Federal Rehabilitation Tax Credits, please contact:
Michael Pulice – Roanoke Regional Preservation Office
Virginia Department of Historic Resources