Historic Tax Credit

Historic Tax Credit

The federal Historic Tax Credit (HTC) has served as a cornerstone for community revitalization efforts throughout the nation for more than forty years. To date, the credit has preserved more than 50,000 properties in every state and leveraged hundreds of billions of dollars in private investment. The federal HTC is a model credit that has led 39 states to create similar tax incentive programs.

What We’re Fighting For

The HTC has not kept pace with other federal incentives and needs to be modernized. Over the past decade, HTCs have lost 25% of their investment value due to unfavorable IRS rulings, administrative burdens, and changes in the credit structure. We are fighting to protect and modernize the Historic Tax Credit.

  • We advocate with other preservation organizations to advance improvements to the HTC.
  • We work with grassroots advocates to arrange tours of HTC projects to help members of Congress experience the HTC’s impacts in their states and districts.
  • We push for Congress to enact the urgently-needed Historic Tax Credit Growth and Opportunity Act (HTC-GO/H.R. 2941, S. 1459), which would help restore the credit’s lost value and make the credit easier to use.

What You Can Do

  • Invite your members of Congress to visit a HTC project to see first-hand the transformative effect the HTC has on local communities. Check out the Arranging a Congressional Site Visit Guide here.
  • Urge your members of Congress to co-sponsor the bipartisan Historic Tax Credit Growth and Opportunity Act (H.R. 2941, S. 1459) and include HTC provisions in moving tax legislation. Read our Historic Tax Credit Issue Brief here.
Take Action Here

Background

The HTC is a development tool for rehabilitating historic buildings, promoting small business opportunities, housing creation, and well-paying construction jobs. The credit is claimed against income taxes & equals 20% of qualified rehabilitation expenditures for certified historic properties. The HTC provides essential gap financing for buildings in urban, suburban, and rural areas and is a true catalyst to revitalize vibrant, people-centric communities. Roughly half of all HTC projects certified each year have development costs of less than $1 million, ensuring private investment small towns and rural communities.

Challenges that negatively affect the programs success:

  • The HTC looks largely as it did in 1986, and is cumbersome for property owners to pair with other incentives like the Low-Income Housing Tax Credit.
  • HTCs have lost 25% of their investment value over the last 10 years, resulting in a decrease in project applications received by NPS each year.
  • Investors claiming the HTC over 5 years (vs. 1), adverse impacts of IRS guidance on HTC deal structures, and the high cost of materials and labor, have led to a decrease in value.

Proposed changes to the HTC included in the HTC-GO Act would help restore value, improve access to the credit, make more projects eligible, and boost the credit for smaller and rural rehabilitation projects.

Additional Resources