TAX CREDITS
Tax credits provide a key tool for the rehabilitation of historic properties listed in the National Register of Historic Places or Register of Historic Kansas Places.
The Federal Tax Credit program provides 20 percent of qualified rehabilitation expenditures on income-producing properties.
Federal Tax Credit Projects
Before
After
The State Tax Credit program provides 25 percent of qualified expenditures on any listed or contributing building.
Projects must meet the Secretary of Interior’s Standards for Rehabilitation.
State Tax Credit Projects
Before
After
Contact our State Historic Preservation Office (SHPO) early in the project planning. Staff members can help ensure that you are following the proper procedures to apply for tax credits.
Tax Credit Worksheet
Follow these questions to understand which tax credit program fits your project.
Are properties listed in National Register of Historic Places or Register of Historic Kansas Places?
Yes = The project is eligible to apply for Federal Tax Credits and State Tax Credits.
No = To be eligible for tax credits properties must be listed. Learn more about listing a property in the National and State Register.
Will property be income-producing?
Yes = The project is eligible to apply for both Federal Tax Credits and State Tax Credits.
No = The project is eligible to apply for State Tax Credits. The federal tax credit program requires that properties be income-producing.
Will project expenses exceed adjusted basis of the building?
Yes = The project is eligible to apply for Federal Tax Credits and State Tax Credits.
No = The project is eligible to apply for State Tax Credits. The IRS requires projects to meet “substantial rehabilitation” to qualify for Federal Tax Credits.
Find more information through the IRS Connection.
Will project expenses exceed $5,000 and will the project be income producing?
Yes - The project is eligible to apply for Federal Tax Credits and State Tax Credits.
No - The project is eligible to apply for Federal Tax Credits.
The state tax credit program requires projects to exceed $5,000.
Will applicant follow the Secretary of Interior’s Standards for Rehabilitation?
Yes - The project is eligible to apply for Federal Tax Credits and State Tax Credits.
No - All work will be reviewed and must meet these standards to qualify for tax credits.
Has project work already begun?
Yes - The project is eligible to apply for Federal Tax Credits. The state tax credit requires that the application be approved before work begins.
No - The project is eligible to apply for Federal Tax Credits and State Tax Credits.
Have good photographs been taken before the beginning of the project?
High quality images taken before work begins are required as part of the application process. Film images are required for federal tax credit projects. Digital images are preferred for state tax credit projects.
Contact the Internal Revenue Service or Kansas Department of Revenue with questions related to taxation. Consult a tax professional before applying for, claiming, or selling state or federal rehabilitation tax credits. Certain laws may limit your ability to claim the credits; other tax implications may apply. Taxpayers wishing to claim insurance proceeds used in a certified rehabilitation as qualifying expenses for purposes of tax credits must claim those insurance proceeds as income on their income tax returns. If a taxpayer does not report the insurance proceeds as income, any expenditures made to the qualifying historic structure with the insurance proceeds will not be used to compute the state or federal historic rehabilitation tax credit.
