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Tax Incentives

Federal Rehabilitation Tax Credit

The Federal Historic Preservation Tax Incentives program is one of the Federal government's most successful and cost-effective community revitalization programs. The Preservation Tax Incentives reward private investment in rehabilitating historic properties such as offices, rental housing, and retail stores.

Current tax incentives for preservation, established by the Tax Reform Act of 1986 (PL 99-514 Internal Revenue Code Section 47) include:

  • A 20% tax credit for the certified rehabilitation of certified historic structures.
  • A 10% tax credit for the rehabilitation of non-historic, non-residentialbuildings built before 1936.

For more information on the Federal Rehabilitation Tax Credit program visit the National Park Service website.

Spotlight on Certified Rehabilitation Projects

State Rehabilitation Tax Credit Update

In his supplemental budget that was signed into law on March 31, 2008, Governor Baldacci incorporated the provisions of LD 262, An Act to Amend the Credit for Rehabilitation of Historic Properties. This bill fundamentally changes the existing state tax credit. Among the changes is the creation of a small projects provision for taxpayers who do not claim the federal tax credit but who could claim the state credit, and the inclusion of an added incentive for the creation of affordable housing. The law will go into effect on July 1, 2008, although the tax credit is allowable for certified qualified rehabilitation expenditures incurred after January 1, 2008. The full text of the amendments can be found in Part WW of the supplemental budget.

The Maine Historic Preservation Commission will administer the program in consultation with the Department of Administrative and Financial Services, Bureau of Revenue Services. The Commission is engaged in the process of drafting rules and application procedures for the program. Please check the website for updates on the rulemaking process.

If you have any questions, please contact Kirk Mohney at (207) 287-3811 or Mike Johnson at (207) 287-2949.

Local Option Property Tax Reimbursement

Municipalities may raise or appropriate money to reimburse taxpayers who own historic properties or properties that provide a scenic view if the property owner agrees to maintain the property in accordance with a locally adopted ordinance.

For more information on the Local Option Property Tax Reimbursement see Maine Revised Statutes Title 30-A, Section 5730 and Guidelines for Municipalities (WS Word, require either Microsoft Word or the free Word Viewer.) developed by the Maine Historic Preservation Commission.