Federal, state, and local tax incentives exist for owners of historic properties. The Federal Historic Preservation Tax Incentives Program includes a 20 percent income tax credit for the rehabilitation of historic, income-producing buildings and a 10 percent income tax credit for rehabilitation of non-historic buildings. The new Texas Historic Preservation Tax Credit Program offers a 25 percent tax credit for the rehabilitation of historic buildings.
Additionally, a state sales tax exemption on labor is available for work to buildings listed in the National Register of Historic Places. County and local taxing authorities may grant property tax exemptions for buildings with state or local historical designations.
Historic photo of Dallas Post Office courtesy of 400 North Ervay.
Increase in the gross state product from activity in the federal rehabilitation tax credit program in Texas between 1979 and 2011
National Trust Publishes Texas Tax Credit Report
An exciting new report, hot off the presses, highlights the economic effects of the federal rehabilitation tax credit program in the state of Texas in the last decade. The National Trust for Historic Preservation partnered with our THC staff as well as our friends at the Texas Downtown Association and Preservation Texas on this project.
The report found that over the past thirteen years, $184 million in federal historic tax credits has leveraged over a billion dollars – $1.1 billion – in rehabilitation development in our state. The report also profiles fifteen successful rehabilitation projects—from Amarillo to Galveston and from El Paso to Houston—that illustrate how the rehabilitation of historic buildings helps revitalize the surrounding community.
We encourage you to share this report with your own community and your Members of Congress to show how effective this program has been in Texas.
House Bill 3230 Passes
With the conclusion of the 84th Legislative Session in June 2015, a bill has officially been passed to extend eligibility for the Texas Historic Preservation Tax Credit program to non-profit use properties. This bill was introduced by Representative Rodriguez of Bexar County and received its final vote of approval in the Senate on May 24, 2015.
How does this new law change the tax credit program? Previously, non-profit owners could only participate in the program if they rehabilitated a for-profit property. Starting January 1, 2016, non-profit owners may receive tax credits for their own non-profit use properties. We are excited to welcome all new eligible applicants to our state tax credit program, and expect to update our published guidance documents as soon as possible.
Read the full text of the bill here: 84(R) HB 3230