The Texas Comptroller of Public Accounts issued guidance Jan. 14 on the certified rehabilitation of certified historic structures tax credit effective for franchise tax reports that were originally due on or after Jan. 1. Texas law provides a franchise tax credit for the certified rehabilitation of certified historic structures, up to 25 percent of eligible costs and expenses. To qualify for the credit: 1.) The structure must be placed in service on or after Sept. 1, 2013; 2.) The entity must have an ownership interest in the structure during the calendar year the structure was placed in service after the rehabilitation; and 3.) The total amount of eligible costs and expenses incurred by the entity must exceed $5,000.
The Comptroller also gives five steps to Establish the Franchise Tax Credit:
- Contact the Texas Historical Commission (THC) for information on how to certify the rehabilitation of a certified historic structure. THC will assist you with the process of obtaining a Certificate of Eligibility.
- Contact a certified public accountant to obtain an audited cost report that itemizes the eligible costs and expenses incurred by the entity in the certified rehabilitation of the certified historic structure.
- Prepare the Texas Franchise Tax Historic Structure Credit Registration (Form AP-235).
- Mail the following three documents to the Comptroller’s office:
- Texas Franchise Tax Historic Structure Credit Registration (Form AP-235)
- The Certificate of Eligibility issued by the THC
- An audited cost report completed by a certified public accountant
- Upon approval the Comptroller’s office will send you a Historic Structure Credit Certificate (Form 05-901) in the mail.
More resources and information are available here.