Federal Income Tax Incentives
The Federal Historic Preservation Tax Incentives allows eligible participants to apply for a state income tax credit equaling 20% of qualifying rehabilitation expenses 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 State Historic Preservation Offices 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.
State Income Tax Incentives
The Georgia State Income Tax Credit Program for Rehabilitated Historic Property allows eligible participants to apply for a state income tax credit equaling 25% of qualifying rehabilitation expenses capped at $100,000 for personal, residential properties, and $300,000 for income-producing properties. The credit is a dollar for dollar reduction in taxes owed to the State of Georgia and is meant to serve as an incentive to those who own historic properties and wish to complete a rehabilitation. The Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Property allows eligible participants to apply for an 8-year property tax assessment freeze. This incentive program is designed to encourage rehabilitation of both residential and commercial historic buildings by freezing property tax assessments for eight and one-half years.
The Georgia Department of Community Affairs Historic Preservation Division and the Georgia Department of Revenue administers the program.
- The application is a two/three-part process, describing before and after rehabilitation. Ideally, project work should be submitted before work begins and be completed within two years.
- Applications for all three programs are sent to HPD, and must be reviewed and approved by HPD.
- There are substantial cost tests that must be met to qualify for each program.