Federal Historic Rehabilitation Tax Credit

Before You Apply

Consult an accountant, tax attorney, other tax advisors, or the IRS frequently asked questions to determine whether these incentives apply to your own tax and financial situation. The Real Estate Tax Tips pages on the IRS website are also a good resource for applicants, consultants, and other preservation professionals working with the historic tax credit program.
Make sure the project meets the “substantial rehabilitation” test and other IRS requirements.
Contact your State Historic Preservation Office (SHPO) for information and technical assistance.
Familiarize yourself with the Basic Submission Requirements and the Secretary of the Interior's Standards for Rehabilitation.

Application Review Fees

The National Park Service invoices applicants for the fees associated with Part 2 and Part 3. There is no fee for state-level review of Federal applications. charges fees to review Part 2 and Part 3 of the application.

The National Park Service and the Internal Revenue Service administer the 20% Federal Rehabilitation Investment Tax Credit program in partnership with State Historic Preservation Offices.

Since 1976, the program has encouraged private sector investment in the rehabilitation and re-use of historic buildings that are income-producing and determined eligible by the Secretary of the Interior, through the National Park Service, to be “certified historic structures.”

The State Historic Preservation Office and the National Park Service review the rehabilitation work to ensure that it complies with the Secretary’s Standards for Rehabilitation.

Projects applying for the federal tax credit often apply for the Ohio Historic Preservation Tax Credit (OHPTC). Please note that aspects of both the state and federal applications must be submitted when applying for the combined credit.

Part 1 Application

Part 2 Application

Part 3 Application

Amendments

Evaluation of Significance

The National Park Service's, Technical Preservation Services consider these things when determining if a property is historic.

• The property is individually listed in the National Register of Historic Places
• The property contributes to a National Register of Historic Places-listed historic district
• The property contributes to a National Park Service-designated Certified Historic District
• The property is individually listed by a Certified Local Government* Contributes to a Certified Local Government-designated historic district. Click here to learn whether your community participates in the Certified Local Government program and for information on how communities qualify for this status.

Use Part 1 to request certification that a building:

• contributes to the significance of a registered historic district or a National Register property with more than one building and is thus a “certified historic structure” for purposes of the 20% rehabilitation tax credit or for easement donation purposes.

Use Part 1 to request a preliminary determination:

• of whether an individual building not yet listed in the National Register of Historic Places might meet the National Register Criteria for Evaluation;
• of whether a building in a potential historic district contributes to the significance of that district;
• of whether a building outside the period or area of the significance of a registered historic district contributes to the significance of the district.

From the time a complete application is received, it typically takes a minimum of 90 days to receive the National Park Service decision.

Download, complete and submit the Part 1: Evaluation of Significance application form. Send two hard copy sets of the completed application and all supporting materials to the State Historic Preservation Office, 800 E. 17th Ave., Columbus, 43211.

Description of Rehabilitation

State Historic Preservation Office Review and Recommendations

Part 2 describes rehabilitation work to be undertaken on the building and must be completed by all applicants seeking the Federal income tax credit for the rehabilitation of historic buildings.

You are strongly encouraged to submit applications describing proposed work and to receive approval from the NPS prior to the start of work. Owners who undertake rehabilitation projects without prior approval from the NPS do so at their own risk. Familiarize yourself with our Basic Submission Requirements compiled to facilitate application preparation.

SHPO recommendation options include:

• Project meets the Standards for Rehabilitation
• Project meets the Standards only if listed conditions are met
• Project does not meet Standards for reason(s) enumerated
• Project warrants denial for lack of information
• Project is being forwarded without recommendation

Following state-level review, one copy of the application is forwarded, by SHPO, with its recommendations to the National Park Service for final review and approval.

From the time a complete application is received, it typically takes a minimum of 90 days to receive the National Park Service decision.

Download, complete and submit the Part 2: Description of Rehabilitation application form and instructions. Send two hard copy sets of the completed application and all supporting materials to the State Historic Preservation Office, 800 E. 17th Ave., Columbus, 43211.

Part 2 Approval
The National Park Service conveys its Part 2 approval decisions by mailing the original Part 2, signed by the federal reviewer indicating approval and any conditions on the approval, to SHPO.

Part 2 Denial
The National Park Service conveys its Part 2 denial decisions by mailing the original Part 2, signed by the federal reviewer indicating denial, to SHPO. Part 2 denials by the National Park Service may be appealed.

Request for Certification of Completed Work

Use the Part 3 form to request approval of the entire completed rehabilitation work. For a completed phase of a project, use an Amendment /Advisory Determination form. The completed project may be inspected by an authorized representative of the Secretary of the Interior to determine if the work meets the Standards for Rehabilitation.

Download the Part 3: Request for Certification of Completed Work. Send two hard copy sets of the completed application and all supporting materials to the State Historic Preservation Office, 800 E. 17th Ave., Columbus, 43211.

Amendments to Approved Work / Advisory Determinations

Use an Amendment / Advisory Determination form to:

• Submit the information requested by the NPS for an application under review and on hold.
• Inform the NPS of a change in ownership.
• Amend a previously submitted Part 1, 2, or 3 application.
• Request an advisory determination as to whether a completed phase of a phased rehabilitation project meets the Secretary of the Interior's Standards for Rehabilitation.

Download the Amendment / Advisory Determination form and instructions here. Send two hard copy sets of the completed application and all supporting materials to the State Historic Preservation Office, 800 E. 17th Ave., Columbus, 43211.

Qualified Rehabilitation Expenditures

Certified Rehabilitation

Certified Historic Structure

Depreciable

Substantial

Phased Project

Placed in Service Date

These expenditures include costs associated with the work undertaken on the historic building, as well as architectural and engineering fees, site survey fees, legal expenses, development fees, and other construction-related costs if such costs are added to the basis of the property and are determined to be reasonable and related to the services performed. They do not include costs of acquiring or furnishing the building, new additions that expand the existing building, new building construction, or parking lots, sidewalks, landscaping, or other facilities related to the building.

The National Park Service must approve, or “certify,” all rehabilitation projects seeking the 20% rehabilitation tax credit. A certified rehabilitation is a rehabilitation of a certified historic structure that is approved by the National Park Service as being consistent with the historic character of the property and, where applicable, the district in which it is located. The National Park Service assumes that some alteration of the historic building will occur to provide for efficient use. However, the project must not damage, destroy, or cover materials or features, whether interior or exterior, that help define the building’s historic character.

A certified historic structure is a building that is listed individually in the National Register of Historic Places —OR— a building that is located in a registered historic district and certified by the National Park Service as contributing to the historic significance of that district. The “structure” must be a building—not a bridge, ship, railroad car, or dam (A registered historic district is any district listed in the National Register of Historic Places. A State or local historic district may also qualify as a registered historic district if the district and the enabling statute are certified by the Secretary of the Interior.).

The rehabilitation must be substantial. That is, during a 24-month period selected by the taxpayer, rehabilitation expenditures must exceed the greater of $5,000 or the adjusted basis of the building and its structural components. The adjusted basis is generally the purchase price, minus the cost of land, plus improvements already made, minus depreciation is already taken. Once the substantial rehabilitation test is met, all qualified expenditures, including those incurred outside of the measuring period, qualify for the credit.

The rehabilitation is expected to be completed in two or more distinct stages of development. Such projects must also meet the "substantial rehabilitation test." However, for phased rehabilitations, the measuring period is 60 months rather than 24 months. This phase rule is available only if: (1) a set of architectural plans and specifications outlines and describes all rehabilitation phases; (2) the plans are completed before the physical rehabilitation work begins, and (3) it can reasonably be expected that all phases will be completed.*

Part 1 Tips

Part 2 Tips

Part 2 Adjacent--Windows

Monitoring an Active Project

Part 3 Tips

Part 1 and 2 of the application may be submitted separately or together. If submitted separately, Part 1 must precede Part 2. Applicants are strongly encouraged to submit applications describing proposed work and to receive approval from the National Park Service prior to the start of construction. Owners who undertake rehabilitation projects without prior National Park Service approval do so at their own risk.

Send two hard copies of your Part 1 application form and accompanying materials to the following address. Note that one copy of the Part 1 application must contain an original "wet" signature of the applicant.

State Historic Preservation Office
Ohio History Connection
Technical Preservation Service Department
800 E. 17th Ave.
Columbus, OH 43211-2474

Is the Property Listed in the National Register of Historic Places?

Contact the State Historic Preservation Office at 614-298-2000 to determine if the property is listed individually or part of a listed historic district.

For buildings within National Register-listed historic districts, use relevant information from Section 7 and 8 of the National Register nomination to prepare Part 1.

When Should I Submit Part 1 Application?

The Part 1 Application should be submitted if you are seeking a preliminary determination of National Register eligibility for a property not yet listed or if your property is located within the boundaries of a National Register-listed historic district. To avoid delays in your project, it is recommended that you submit a Part 1 well ahead of the planned project start date.

If rehabilitation work is completed and the building has been placed in service prior to the submission of the Part 1, the project will likely not qualify for the tax credit according to IRS regulations. To learn more about late submissions, read Topical Tax Brief – Late Submission of the Historic Preservation Certification Application. It is recommended that you consult with the IRS regarding late submissions.

If you are working with a property that is less than fifty years old, has experienced extensive alterations or additions, or the history and significance of the property are difficult to determine, work with the Inventory and Registration Department of the State Historic Preservation Office to complete a National Register Preliminary Questionnaire before submitting the Part 1 application.

What Should I Submit with the Part 1 application?

National Register Nomination Draft
For properties not yet listed in the National Register, a draft narrative, equivalent to Sections 7 and 8, of a National Register nomination must be submitted with the completed Part 1 application.

Historic District Map
A copy of the district map from the National Register nomination should be included for buildings located in a National Register-listed historic district. Clearly mark the property location on the district map.

Photographs
All Part 1 and Part 2 photographs should be taken at the same time, BEFORE starting any work and submitted with the Part 1 application. All photos must be:

• 4x6 color
• Printed on photo quality paper
• Labeled per application instructions and documentation requirements
• Numbered in simple sequential order starting with Photo 1. Do not introduce photo numbering systems by floor, elevation, or interior/exterior.
• Cross-referenced (keyed) to existing view floor plans
• Include true “before” rehabilitation photographs of the entire building or site

Photos cannot be bound or mounted. Please package photos in 6” x 9” manila envelopes. Lack of proper photograph documentation of the “before” condition of the building may well result in a recommendation of denial.

How Can I Know the Best Photographs to Take?

Views of all interior and exterior spaces and elevations are required whether or not you intend to work in those areas or take the tax credit for those areas. Additional things to consider when taking photographs:

• Remember that the state and federal reviewers do not know the building! The photos need to document every aspect of it, top to bottom, inside and out.
• Make sure spaces are well lit and otherwise adjust camera settings to achieve the best quality photos.
• Exterior photographs must include all elevations, the immediate site area and some of the surrounding buildings and streetscape
• Interior photographs should be taken and cross-referenced going systematically floor by floor.

How Will I Know You Have Received My Application?

You can see your project submission online using the project receipt status form.

How Long Does It Take For My Part 1 To Be Reviewed?

Once a completed submission is received the review period is 30 days. Remember that our 30-day review period does not start until an application is complete, so there is no advantage to submitting part of the information or incomplete information ahead of time. If additional information must be requested, the 30-day review period begins anew.

Part 2 applicants are encouraged to submit applications describing proposed work and to receive approval from the National Park Service prior to the start of construction. Owners who undertake rehabilitation projects without prior National Park Service approval do so at their own risk.

Send two hard copies of your Part 2 application forms and supporting materials to the State Historic Preservation Office. One copy of the Part 2 application must contain an original "wet" signature of the applicant.

State Historic Preservation Office
Ohio History Connection
Technical Preservation Service Department
800 E. 17th Ave.
Columbus, OH 43211-2474

Preliminary Meeting
Schedule a preliminary meeting with the Technical Preservation Services Department staff during the project planning stage, before any rehabilitation work is undertaken. We are here to assist you. We want your project to be successful, and early planning is key.

While we can’t design your project or recommend particular products, we are happy to react to the initial materials and information you show us and suggest solutions based on our experience. Please do not hesitate to contact our office at 614.298.2000 with any questions at any point in the process.

General Recommendations
Carefully read and follow the application instructions and call our office at 614.298.2000 with any questions.

Submit Part 2 well before the planning commencement of construction. The typical review period for the Part 2 is 90 days. It is important to allow this amount of time for the review and approval process carried out at the state and federal levels. This 90 day review period does not include mailing time, fee processing time, or more than one round of clarifying questions.

Submit complete and accurate project information to avoid multiple holds and multiple restarts of the 30-day review period. In all instances, drawings and the application narrative are to be in agreement.

Complete and accurate information on the Part 2 cover sheet is essential. Neither state-level nor the federal–level reviewers are permitted to alter any information on the cover. The only option is to submit a new cover. Be mindful of details like Social Security number, zip-plus-4 zip codes, original signatures in ink and checking appropriate checkboxes when completing the cover.

The National Park Service makes all final decisions on the certification application. Owners should always wait for the National Park Service's decision before proceeding with any work or ordering costly materials.

What Information Should I Include in Part 2?

Project Summary Paragraph
Use the first field under Item 5., Project Description, to provide a paragraph or two summarizing the project and its timeline.

Feature by Feature Descriptions [Also Known as the Project Narrative]
Be sure to address all features of the building and its site, historic or not, in completing the project narrative. If you are not doing work to a feature, describe the feature and state “no work to be done.” All work must be mentioned in this section even if others are paying for the work. Include construction or alteration of features and additions. Work must be described in detail sufficient for the State Historic Preservation Office to determine the effect of the proposed work on the appearance, integrity and condition of the building and its component. Note that in the event of any discrepancy between the application form and supplementary materials submitted with it, such as architectural plans, the application form takes precedence.

If the specifics of work to a feature or system are unknown, state that once known, final details will be submitted prior to the commencement of work via the Amendment review and approval process. This will help avoid a Part 2 condition, but please use caution when doing this since projects need to be viewed and reviewed in whole to determine the compatibility of the work and compliance with the Standards.

Features and systems to include in the project narrative include but an not limited to the following:

Exterior

• site, including signage and exterior lighting
• roof and drainage systems
• cornice
• additions
• wall treatment
• siding
• foundation
• trim
• windows
• doors

Interior

• each major interior space
• stairs
• doors and trim
• walls and ceilings
• secondary spaces
• electrical system
• plumbing, including sprinklers
• HVAC systems
• new construction

What Should I Submit with the Part 2?

Be sure to check the Documentation Requirements page on the National Park Service tax program website.

Drawings
Most projects require some drawings. Please submit only “meaningful” and legible drawings; that is, drawings that give a good visual representation of what is described in the narrative.

Photographs
See tips regarding photographs under Part 1 Tips

Additions
If one or more additions are planned as part of the project, submit a model, photos of a physical mock-up, and/or a rendering with a sightline study for any additions, including rooftop work. The National Park Service does not accept sightline studies alone. Photos taken from several vantage points around the building and neighborhood may be required.

In Part 2 we must have a sufficient understanding of what the overall project will be and if the project will meet the standards in order to complete our review and issue a recommendation. Also, think of your construction timeline and plan accordingly when submitting these items via an Amendment.

When is an Amendment Needed?

A project may require one or more amendments during the course of the project. An amendment must be submitted if Part 2 was submitted with some aspects of the work unknown at the time and if any aspect of the rehabilitation project changes during the course of the work. Changes to work items that are carried out prior to the conclusion of the amendment review and approval process risk not being approved.

Consider your amendment submission as a mini Part 2 application – with as much detail and all pertinent supplemental information (such as drawings, renderings, additional photographs, etc.) included. As with Part 2, the Amendment narrative takes precedence, and all materials must agree.

Discuss potential amendments with your State Historic Preservation Office reviewer prior to submitting an amendment to help facilitate the review and approval process.

List All Amended Items
Briefly describe all amended items on the amendment cover sheet in the space above the signature block. Attach additional sheets to more specifically describe the proposed changes.

Differentiate the Narrative Revisions
Make clear what was originally proposed and how what is proposed in the amendment differs by highlighting or italicizing the changes. Only work items clearly identified in the Amendment narrative as being revised or amended will be reviewed.

Drawings
Only include “meaningful” drawings with any submission, including amendments. Only drawing details clearly identified as revised will be reviewed. Clearly show where changes are to occur through labels, “clouding” or highlighting the work. All work detail must be included in the narrative, not just shown on the drawings.

Interim approvals for fully completed phases are submitted on amendment forms; however if full project completion is imminent, please wait and submit the full Part 3.

Build into your work schedule sufficient time for the Amendment (or Amendments) review process including the National Park Service decision, which is typically no less than 60 days, not including mailing time, if all information is complete upon submission. The 30-day review clock begins anew whenever additional information is needed.

National Park Service makes all review decisions, so applicants should always wait for the National Park Service decision prior to proceeding with any work or order. To begin work before NPS approval is to proceed at one’s own risk.

Windows often contribute to the historic character of a building. Under state and federal historic rehabilitation tax credit programs, retaining and repairing original or historic windows are typically required unless the windows have deteriorated beyond repair and that condition is well documented.

Window Repair

When planning your project, be sure to review Preservation Briefs 9, The Repair of Historic Wooden Windows, and 13, The Repair and Thermal Upgrading of Historic Steel Windows, and the variety of Tech Notes on windows.

See also a page developed by the California State Historic Preservation Office on window repair.

General Replacement Window Tips

All replacement windows should feature details that are typical of the historic window characteristics for that building (i.e., industrial sash, wooden double-hung, etc.). For example, when replacing historic wooden double-hung windows, the new units should have mortise & tenon joinery (butt joints; no mitered corners), a beveled putty detail, etc.
Replacement windows should fill the historic masonry/rough opening(s) entirely and be installed in the same plane in the wall as the historic windows.
If no historic trim remains on the interior, it is our experience that NPS prefers that replacement windows be installed within rough masonry openings when replacement is justified. Though this may result in the removal of existing window framing, brick mold, etc., it allows for the installation of an entirely new window assembly while protecting the historic daylight opening. If historic trim remains on the interior, care should be taken to retain this trim and work within it. This may result in the installation of a new sash only – as opposed to entirely new window assemblies – when replacement is justified.
While NPS affords greater latitude in the accepted level of variation in new windows on secondary elevations and upper floor openings with a reduced level of visibility from the ground, SHPO strongly encourages an emphasis on simplicity in all replacement windows. A focus on the proportionality of components, replication of historic details such as butt joints and a beveled putty detail, and minimization of excess shadow lines resulting from cladding extrusions, screen tracks, etc., is the best way to ensure compatibility and increase the likelihood of receiving a recommendation for approval.
Unlike measured drawings, mock-ups are not required documentation for projects involving window replacement. However, SHPO believes that mock-ups are an excellent way to document the visual differences between existing and proposed windows and welcomes their inclusion as supplemental documentation if many windows are to be replaced.

Replacement of non-historic Windows

Replacement windows must replicate the characteristics of the building's historic windows if known or must otherwise be compatible with the historic character of the building. The National Park Service requires that the following drawings be included in the documentation provided with Part 2 of the application:

Exterior and interior elevations of proposed windows
Vertical section(s) of proposed windows
Horizontal section(s) of proposed windows

The State Historic Preservation Office (SHPO) recommends submitting a supplemental window key plan/elevation depicting locations of all windows, including information about window material, configuration, operation, and installation date/contribution to the property's historic significance. This information should be submitted for SHPO review and comment and National Park Service approval prior to ordering replacement windows or commencing work.

Existing windows that do not contribute to the building's significance and are scheduled for replacement may be replaced with windows that replicate the characteristics of the building's historic windows if pictorial or physical documentation exists to inform decision making. However, the minimum requirement in this scenario is only that the replacement windows be compatible with the historic character of the building.

Regular Monitoring

Property owners are advised to have a project monitoring system in place to ensure compliance with tax program rules and to avoid any surprises at the conclusion of the project when final approval is sought. If there have been or need to be changes to the approved project, bring them to the attention of the State Historic Preservation Office via the Amendment process. Getting amendments reviewed and approved prior to submission of your Part 3 helps insure the smooth and successful completion of your application.

Fulfilling Project Conditions and Submitting Information

Establish reminders in the project schedule related to fulfilling project conditions and submitting promised information. If you promised information to the State Historic Preservation Office, please provide it in a timely manner. Typical matters promised by applicants include masonry cleaning or repointing tests, window specifications and samples, storefront details, interior finish details and exterior lighting, awnings and other treatments. Please submit such information in time for the State Historic Preservation Office to review and comment on it as necessary prior to completing the work.

Prior to submitting your Part 3 to our office, carefully re-review your approved Part 2 and any subsequent project Amendments. If you promised to submit something or do something in the Part 2 or on an Amendment, you must state in the Part 3 application how this promise was fulfilled. The owner must submit a cover letter or an Amendment sheet with the Part 3 indicating how any conditions that were placed on the Part 2 or Amendment approvals were met.

Send two hard copies of your Part 3 application form and accompanying materials to the following address. Note that one copy of the Part 3 application must contain an original "wet" signature of the applicant.

State Historic Preservation Office
Ohio History Connection
Technical Preservation Service Department
800 E. 17th Ave.
Columbus, OH 43211-2474

Submit Amendments Forms as Needed

Use an Amendment form to describe work that was not undertaken or if any revisions were made to the project without first seeking Amendment approval from the National Park Service.

Photographs

Take the Part 3 completion photos from the same locations and number them the same as the Part 1/Part 2 photos, to the extent possible. This will simplify your preparation of the photo key (on current/rehab plans) and make it easier for us and the National Park Service to review Part 3.

Submit 4”x 6” color photographs printed on photo quality paper in a stack, not bound or mounted, numbered in sequential order and keyed to current/rehab floor plans. Label the backs of photographs per the application instructions and documentation requirements. Please package photos in 6” x 9” manila envelopes.

Point out the photographs that satisfy compliance with project conditions or Amendments.

Submit photographs of all areas of the building and site sufficient to convey all aspects of the after-rehabilitation appearance. This includes areas where no work was done and the appearance is unchanged and areas where work was completed but for which you are not taking the tax credit. All work, whether or not the Federal credit is being sought, must meet the Secretary of the Interior's Standards at the completion of the project and for a period of five years after project completion and the building is placed in service.

Federal Historic Preservation Tax Credit

Submitting a Federal Historic Tax Credit Application

Evaluation of Significance

Common Definitions

Tips for Completing a Federal Historic Tax Credit Application

Is the Property Listed in the National Register of Historic Places?

When Should I Submit Part 1 Application?

What Should I Submit with the Part 1 application?

How Can I Know the Best Photographs to Take?

How Will I Know You Have Received My Application?

How Long Does It Take For My Part 1 To Be Reviewed?

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