Basic eligibility requirements

This historic school building in Oakland, California, was rehabilitated for use as a medical facility. Photo: NPS files

What are the basic requirements that determine whether a project will be eligible for the 20% tax credit?

Answer
There are 4 factors that can help you decide whether your rehabilitation project proposal would meet the basic application requirements for the 20% tax credit.

1. The historic building must be listed in the National Register of Historic Places or be certified as contributing to the significance of a "registered historic district."

2. After rehabilitation, the historic building must be used for an income-producing purpose for at least five years. Owner-occupied residential properties do not qualify for the federal rehabilitation tax credit.

3. The project must meet the "substantial rehabilitation test." In brief, this means that the cost of rehabilitation must exceed the pre-rehabilitation cost of the building. Generally, this test must be met within two years or within five years for a project completed in multiple phases.

4. The rehabilitation work must be done according to the Secretary of the Interior's Standards for Rehabilitation. These are ten principles that, when followed, ensure the historic character of the building has been preserved in the rehabilitation.

For More Information

The Federal Historic Preservation Tax Incentives Program