Latest Changes to the State Tax Credit program
New legislation for the state historic tax credit program was passed in the 2020 budget. The new state tax credit program will extend to 1/1/2024 and expire for qualified rehabilitation expenditures and rehabilitation expenses incurred on or after 1/1/2024. For qualified rehabilitation expenditures and rehabilitation expenses incurred prior to 1/1/2024 and the property is not yet placed in service, the state historic tax credit expires 1/1/2032. Preservation Durham will provide an update and workshop soon.
To be eligible for any of the tax credits for historic rehabilitation (State or Federal), the property must be a certified historic structure. A certified structure is one that is Individually Listed on the National Register of Historic Places or listed as a Contributing Structure in a National Register Historic District.
- The State Historic Preservation Office has an online searchable map of all National Register listed places in the state. http://gis.ncdcr.gov/hpoweb/
- Click on the house icon to search. Type in your property's address. The map will zoom to the searched address.
- If the site is Individually Listed on the National Register, it will display as a blue dot with the name of the structure. You can click on the dot for more information about the property. Click on View the NR Nomination Form to read theNational Register Nomination for the property. The Nomination gives a physical description and history.
- If your property has a blue dot and is Individually Listed, it is eligible for tax credits for historic rehabilitation.
- If the site is located within a National Register Historic District, the district area will shaded and outlined in blue. Click anywhere within the shaded area. An info box with details on the district will be displayed.
- To check if your property is a Contributing Structure to the District, you must look at the National Register Nomination Form. Click on the View the NR Nomination Form link. The Nomination will be a long document displayed as a pdf. The nomination will give history of the district as a whole and of specific properties. The nomination has three sections: the first few pages are standard forms filled out about the district, second is a narrative description of the district (history, architectural styles), third is an inventory that lists every property located within the boundaries.
- Scroll through the nomination to the inventory section.
- Locate your property by its address. The list may be organized alphabetically by streetname or geographically by street (moving north-south, for example). Often, odd numbered properties are grouped together, followed by even numbered properties.
- The inventory will list the address, date of construction, and a code (C for Contributing or NC for Non-Contributing). It will also list the official name of the property (most often named for the first resident) and a brief physical description.
- If your property has the code C, it is classified as Contributing to the District, and it is eligible for tax credits for historic rehabilitation.
- If you property has the code NC, it is classified as Non-Contributing to the District, and it is not eligible. If you wish to dispute the classification, you must contact the State Historic Preservation Office (see below).
STATE CREDITS SUMMARY
NON-INCOME PRODUCING (RESIDENTIAL HOMEOWNERS)
- Credit equal to 15% of Qualified Rehabilitation Expenditures (reduced from 30% in previous years).
- Qualified costs capped per project at $150,000.
- Minimum expenditure: Project must spend at least $10,000 over 24 months. Total costs may be greater, and total project period may be longer.
- Credit may be claimed in one year or carried forward up to 10 years.
INCOME-PRODUCING (COMBINES PREVIOUS COMMERCIAL & MILL CREDITS)
- Base credit rate of 15% of Qualified Rehabilitation Expenditures.
+ additional 5% for mills (previous $3M spending requirement has been eliminated).
+ additional 5% for projects located in economically distressed counties.
- Credit rate is tied to qualified costs (QRE), which are capped:
$0 to $10M QRE = base rate
$10M to $20M QRE = base rate - 5%
QRE hard cap at $20M.
To learn more about NC State Rehabilitation Tax Credits visit:
Contact NC SHPO directly for more information. Provide your name, address, and name and location of your project.
FEDERAL CREDITS SUMMARY
- Income-producing properties only.
- Credit equal to 20% of Qualified Rehabilitation Expenditures.
- No cap on credit. Credit may be carried forward for 10 years.
To learn more about the Federal Rehabilitation Tax Credits visit: