Utah Tax Credit

Utah Historic Preservation Tax Credit
(Revised November 2000)

Do you just need an Application?

What is the Utah Historic Preservation Tax Credit?
A 20 % nonrefundable tax credit for the rehabilitation of historic buildings which are used as owner-occupied residences
or residential rentals. Twenty percent of all qualified rehabilitation costs may be deducted from taxes owed on your Utah income or corporate franchise tax.

Example: $22,000 in qualified rehabilitation cost = $4,400 state income tax credit.

Does My Building Qualify?
Buildings listed in the National Register of Historic Places, which, after rehabilitation, are used as a residence(s) qualify.
The credit is not available for any property used for commercial purposes including hotels or bed-and-breakfasts. (If the historic B&B is also owner-occupied, this portion of the rehabilitation may qualify.) The building does not need to be listed
in the National Register at the beginning of the project, but a complete National Register nomination must be submitted
when the project is finished. The property must be listed in the National Register within three years of the approval of the completed project. Staff of the Historic Preservation Office can evaluate the eligibility of your building and provide
instructions on nomination requirements.

For more information about the National Register see http://www.cr.nps.gov/nr/about.htm.

What Rehabilitation Work Qualifies?
The work may include interior and/or exterior repair, rehabilitation or
restoration, including historic, decorative, and structural elements as well
as mechanical systems. All of the proposed, ongoing or completed work must meet the Secretary of the Interior's Standards for Rehabilitation and be approved by the State Historic Preservation Office (SHPO). Depending on the historic conditions
and the specifics of the proposed rehab work, some examples of eligible work items include:

-repairing/upgrading windows
-plumbing repairs and fixtures
-refinishing floors, handrails, etc.
-repairing or replacing roofs
-compatible new kitchens & baths
-reversing incompatible remodels
-painting walls, trim, etc.
-repointing masonry
-reconstructing historic porches
-new furnace, A/C, boiler, etc.
-new floor and wall coverings
-electrical upgrades

Necessary architectural, engineering, and permit fees may also be included. The purchase price of the building, site work (landscaping, sidewalks, fences, driveways, etc.), new additions, work on outbuildings, and the purchase and installation
of moveable furnishings or equipment (window coverings, refrigerators, etc.) do not qualify for the credit.

All of the work must meet the Secretary of the Interior's Standards for Rehabilitation (Great Illustrated Guide from the NPS) or the tax credit cannot be taken on any portion of the work. A complete application should be submitted to the SHPO
as early as possible. The state law requires application and approval by the SHPO prior to completion of the project.

We strongly recommend that you submit an application before starting work. Any work begun without prior SHPO approval is done at the owner's own risk. Once work is underway, changes to bring the project into conformance with the Secretary of the Interior's Standards for Rehabilitation can be difficult, expensive or occasionally impossible to make.

(The National Park Service has prepared an online course to help building owners identify the tangible elements or features
that give historic buildings their unique visual character. Reading this will help you make design decisions regarding your
historic house.)

Photographs showing all areas of work (interior and exterior) prior to the beginning of the rehabilitation and any
construction drawings or other technical information necessary to completely understand the proposed project are
also required as part of the application.

How Much Money Must I Spend to Qualify?
Total rehabilitation expenditures must exceed $10,000. (The tax credit applies equally to this first $10,000.) The purchase price of the building and any donated labor cannot be included. The project must be completed within 36 months. (There
is no limit to subsequent $10,000+ projects; separate applications are required.)

When Can I Claim the Credit?
The credit may be taken for the tax year in which the project was completed and the SHPO approves the rehabilitation
work (and a National Register nomination, if needed). A unique certification number will be issued to the owner at that
time. Credit amounts greater than the amount of tax due in that year may be carried forward up to five years.

Are There Any Restrictions Placed on My Building?
All work done to the building during the rehabilitation project, and for three years following the certification of the project, must meet the Secretary of the Interior's Standards for Rehabilitation. Please consult with the State Historic Preservation Office if you have any questions.

What if I Already Have Approval From my Local Landmarks Commission?
The local review process will be helpful to tax credit application process but state law requires application to the State
Historic Preservation Office. Local preservation commissions sometimes have different requirements and other
considerations than the Secretary of the Interior's Standards for Rehabilitation. To qualify for the state tax credit, all of
the work must meet the Standards and receive state approval. Application for the state tax credit must be made before
the project is completed, preferably before work even begins (see above).

How do I Claim the Tax Credit?
After the work is completed and certified, the SHPO will provide the building owner with tax form, TC-40H, Historic Preservation Tax Credit. Do not submit this form with your tax return; keep it and all related documents with your tax records. If you carry forward an excess portion of this tax credit, you must attach a copy of the signed, original TC-40H
form, with the new carry forward amount, to your subsequent tax return(s).

Note that carry forward amounts must be applied against tax due before the application of any historic preservation tax credits earned in the current year and on a first-earned, first-used basis. Please consult with the State Tax Commission
if you have any questions. Original records supporting the credit claimed must be maintained for three years following the date the return was filed claiming the credit.

For more information or for an application:

Nelson Knight at (801) 533-3562
State Historic Preservation Office
Utah Division of State History
300 S. Rio Grande Street
Salt Lake City, Utah 84101
fax: (801) 533-3503

For tax-related questions contact:

Lynn Solarczyk at (801) 297-3869
Utah State Tax Commission

For information on low-interest preservation loans, contact:

Utah Heritage Foundation at (801) 533-0858

For information on low-income housing tax credits (for developers) or low-interest, first-time home buyer programs
contact: (801) 323-2603

Additional local requirements may also apply:

Salt Lake City Landmarks, (801) 535-7757

Park City Planning Department (435) 615-5060

Ogden Planning Department (801) 629-8920

The State Historic Preservation Office can provide additional local preservation contacts.