Historic Preservation Tax Credit
The Historic Preservation Tax Credit is a series of programs offered by the United States government and, formerly by the State of Alabama, to support the preservation and adaptive re-use of historic structures.
The federal program allows owners to claim a tax credit of up to 20% of qualifying expenses toward the rehabilitation of a National Register of Historic Places-listed properties and 10% for other pre-1936 structures for income-producing purposes. The work must be performed according to the Secretary of the Interior's Standards for Rehabilitation. The program is administered by the National Park Service and the Internal Revenue Service in partnership with the Alabama Historical Commission.
Alabama's Historic Preservation Tax Credit was instituted in 2013 and expired in 2016. It allowed for a a credit of 25% of rehabilitation expenses for income-producing or residential purposes for certified historic structures, or a 10% credit for buildings constructed before 1936 which were not certified as historic. The state allowed any NRHP listed building, any building identified as a contributing structure in an NRHP listed historic district, and any building which was eligible for such a listing to be certified. Projects were required to meet a threshold of $25,000 or 50% of the purchase price for the property to qualify, and the work had to be be done according to the Secretary of the Interior's Standards for Rehabilitation. Commercial project credits were capped at $5,000,000 and residential projects at $50,000. The overall program was limited to $20,000,000 in total tax credits per fiscal year. The credit could be applied over ten consecutive tax years after certification.
Despite overwhelming popular support, when the program came up for renewal in the 2016 legislative session, Senate President Pro Tem Del Marsh (who had co-sponsored the reauthorization) withheld the bill from a vote. He pointed to concerns raised by fellow senators Tripp Pittman and Arthur Orr regarding the impact of the credit on the state's budgeting process. Marsh further argued that the credits were not necessary, citing his own efforts to preserve Anniston's Victoria Hotel. He called for an independent study of all tax credit programs.
Federal tax credit projects
|Structure||Project cost||Year completed|
|Birmingham Electric Company Building||$175,000||2000|
|McAdory Block/Huey Building||$50,000||2001|
Alabama Historic Rehabilitation Tax Credit projects
|Structure||Amount requested or approved||Year completed|
|Thomas Jefferson Hotel||$5,000,000||2016|
|Birmingham Fire Station No. 10||$75,000||2016|
|First Federal Savings & Loan building||$1,362,500||2016|
|Empire Parking Garage||$62,200||2016|
|Iron Age Building||$187,500||2016|
|Mack Truck Garage||$281,250||2016|
|Lyric Theatre||$2,435,000 granted||2016|
|Cain Furniture Co.||$1,662,500||2016|
|Birmingham Branch of the Federal Reserve Bank of Atlanta||$5,000,000||2016|
|Orlando Apartments||$40,000 requested||2016|
|Protective Life Building||$5,000,000 approved||2018|
|2200 Magnolia Avenue||$1,668,000 approved||2018|
|Stonewall Building||$182,182 approved||2018|
- Save America's Treasures grant program
- Diel, Stan (October 15, 2015) "Status of Historic Preservation Tax Credits for Projects Across Alabama." BirminghamWatch
- Sharp, John (April 21, 2016) "Alabama historic tax credit program ending next month, says Senate president." The Birmingham News
- Godwin, Brent (May 6, 2016) "Historic tax credit extension dies, but supporters gear up for 2017 push." Birmingham Business Journal
- Godwin, Brent (February 11, 2019) "Looking at Alabama's Historic Tax Credit program after first year of relaunch." Birmingham Business Journal
- Tax Incentives at nps.gov