CliftonLarsonAllen (CLA) has the national resources, local knowledge, and experience with historic tax credits to give you the confidence to pursue the investment, development, and rehabilitation of old structures.
The Historic Tax Credit (HTC) incentivizes developers to rehabilitate properties to preserve their historic nature and architectural significance. These projects tend to cost more than a typical renovation, which can make the HTC a final piece of the capital stack when developing historic buildings, such as offices, condominiums, and retail stores.
A unique approach
CLA combines deep industry specialization in the real estate industry with our experience and connections in the HTC arena to help your rehabilitation project succeed. We are a national firm with resources in most markets and therefore have specific knowledge of the regions in which these projects are being completed. We can help you navigate the paperwork needed to move your project forward.
How the historic tax credit works
To claim a 20-percent federal credit, the building must be listed on the National Register or be a contributing structure in a registered Historic District. In addition, more than 30 states also have a state level credit.
If a developer spends $12 million to rehabilitate a historic property and $10 million of it qualifies for the credit, a $2 million federal credit would be generated. If the developer cannot utilize the credit, a private sector investor can be brought in to take the credit. At $0.85 price per credit, an investor would inject $1.7 million of federal tax credit equity into the project.
Historic tax credit services
- Consulting related to structuring alternatives
- Financial projections to show benefits of credit equity and project cash flow
- Connecting developers with industry networks to build a robust deal team
- Tax planning to help maximize the benefit of federal and state credits
- Tax return and audit services during the compliance period
- Investor quarterly reporting
- Exploring other federal, state, and local incentives to benefit the project (e.g., new market tax credit or energy tax credits)
- Construction cost audits