CHARLESTON, W.Va. – The West Virginia State Historic Preservation Office, West Virginia Department of Arts, Culture and History (WVDACH) administers the Historic Rehabilitation Tax Credit Program. With the signing of House Bill 4568 by Gov. Justice, yearly state caps on tax credits were removed and phased rehabilitation projects can now claim tax credits upon approved completion of each phase. The bill passed on March 11, 2022, and will be in effect ninety days from passage.
The federal and state Historic Tax Credit (HTC) program encourages private investment in historic buildings in West Virginia. Applicants must follow the Secretary of the Interior’s Standards for Rehabilitation to ensure that the work done preserves the building’s historic integrity. If all conditions and steps are followed, the owner will benefit from a total nominal tax credit of 45% of investment for commercial HTC projects and 20% for residential HTC projects.
What this means for HTC “caps” that were in place:
The yearly state-wide limit of $30 million will be removed. Individual projects themselves will also no longer be capped at $10 million per project in tax credits. Finally, there will no longer be a reservation of $5 million in tax credits allocated only to smaller projects with under $500,000 in proposed tax credits. All current existing limitations and allocations of credit will be lifted under this new legislation. Accordingly, guarantees or reservations of credit will no longer be issued by our office.
What this means for the amount of credit received by each project:
There will be no change from the 25% of the state qualified rehabilitation expenditure (QRE) credit for commercial projects and no change from the 20% state QRE credit for residential projects. Federal tax credits for commercial QREs remain at 20%.
What this means for phased rehabilitation projects:
Phased rehabilitations must be planned out ahead of the project as usual, with applicants required to elect and plan for a phased rehabilitation as indicated in their Part 2 Description of Rehabilitation application before work begins. The owner may begin to claim credit allowable for each completed phase. Written tax credit certificates can be requested by the applicant for completed phases of the phased rehabilitation project once each phase is approved by the State Historic Preservation Office. Any claimed tax credits may be subject to recapture if an applicant fails to submit an approved Part 3 application within 60 months of the date of the advisory determination by the National Park Service.
For any further clarification on the new legislation or the Historic Tax Credit itself, please contact Meredith Dreistadt, Tax Credit coordinator, West Virginia State Historic Preservation Office, at meredith.c.dreistadt@wv.gov or 304-558-0240.
The Department of Arts, Culture and History is an Equal Opportunity/Affirmative Action Employer.
The activity that is the subject of this press release has been financed with federal funds from the National Park Service, Department of the Interior. The program receives federal funds from the National Park Service. Regulations of the U.S. Department of the Interior strictly prohibit unlawful discrimination in departmental Federally Assisted Programs on the basis of race, color, national origin, age, or handicap. Any person who believes he or she has been discriminated against in any program, activity, or facility operated by a recipient of federal assistance should write to: Office of Equal Opportunity, National Park Service, 1849 C Street NW, Washington, DC 20240.
