When looking to buy a property, does the word "Historic" turn you off?
Did you know that there is a unique benefit for owners of residential and commercial historic properties?
"Facade conservation easements, under the Federal Historic Preservation Tax Incentive Program, are one of the most underutilized tax deductions available to historic property owners. Historic trusts, not-for-profit organizations that administer conservation easements, can make the procedure easier for taxpayers and their financial advisors. Taxpayers should be aware of this opportunity to save money while also serving the public interest by preserving historic properties in urban settings for future generations." The CPA Journal, March 2003
Today's Tax Benefit
To encourage owner participation in the preservation of our historic neighborhoods, the U.S. National Park Service administers the Federal Historic Preservation Tax Incentive Program, Internal Revenue Code Section 170(h).
This legislation allows property owners who formally agree to maintain and preserve forever the architecturally significant features of their properties' exterior to be eligible for a federal income tax deduction. Many state and local tax codes recognize this income deduction as well.
The amount of the deduction is equal to the fair market value of the easement donation as determined by an independent, professional appraiser.
Tomorrow's Benefit
The donation of an historic preservation easement to the Trust for Architectural Easements* protects the historic character of your property's exterior for future generations. In general, an easement grants a limited right in the use of a property to another party. An historic easement deals with the right to change the exterior of your property. While the owner retains title to your property and can change its interior, rent it, sell it, will it, or live in it as he or she wishes, the easement agreement requires the property owner to maintain the structural integrity of the building and obtain prior approval from the Trust to Make changes to the exterior of the building. This ensures that the building remains structurally sound and that any changes are consistent with the building's historic architectural style
It is important to note, that when making changes to an historic property, a property owner is not limited to using antique or old building materials. Modern building materials are allowed, as long as the appearance or aesthetic of those materials is consistent with and maintains the property's particular architectural style.
Property Eligibility
To qualify for the Federal Historic Preservation Tax Incentive Program, a property must be located in one of the historic districts designated in the National Register of Historic Places and must contribute to the historic significance of the district or be individually listed in the National Register.
Donation Process
Today's Tax Benefit
To encourage owner participation in the preservation of our historic neighborhoods, the U.S. National Park Service administers the Federal Historic Preservation Tax Incentive Program, Internal Revenue Code Section 170(h).
This legislation allows property owners who formally agree to maintain and preserve forever the architecturally significant features of their properties' exterior to be eligible for a federal income tax deduction. Many state and local tax codes recognize this income deduction as well.
The amount of the deduction is equal to the fair market value of the easement donation as determined by an independent, professional appraiser.
Tomorrow's Benefit
The donation of an historic preservation easement to the Trust for Architectural Easements* protects the historic character of your property's exterior for future generations. In general, an easement grants a limited right in the use of a property to another party. An historic easement deals with the right to change the exterior of your property. While the owner retains title to your property and can change its interior, rent it, sell it, will it, or live in it as he or she wishes, the easement agreement requires the property owner to maintain the structural integrity of the building and obtain prior approval from the Trust to Make changes to the exterior of the building. This ensures that the building remains structurally sound and that any changes are consistent with the building's historic architectural style
It is important to note, that when making changes to an historic property, a property owner is not limited to using antique or old building materials. Modern building materials are allowed, as long as the appearance or aesthetic of those materials is consistent with and maintains the property's particular architectural style.
Property Eligibility
To qualify for the Federal Historic Preservation Tax Incentive Program, a property must be located in one of the historic districts designated in the National Register of Historic Places and must contribute to the historic significance of the district or be individually listed in the National Register.
Donation Process
To further its mission, the Trust for Architectural Easements will take certain steps to facilitate an enforceable donation to the Trust. Although it requires several months to obtain all of the approvals required to complete your donation, the process requires on average, less than three hours of your time. Large-scale, income producing properties may require more time from your legal and tax advisors. Costs include appraisal and bank service fees. Donors also make charitable cash contribution to the Trust for Arhcitectural Easements in order to provide it with sufficient funds to monitor its easements in perpetuity. The Trust recommends that you consult your own legal and/or tax advisors prior to making a donation of an historic preservation easement. Your advisor can help you understand the conditions seet forth in the easement agreement and the requirements for claiming a related tax deduction. Please note, that the Trust does not provide legal or tax advice.
*The Trust for Architectural Easements is a qualified 501(c)(3) not-for-profit organization dedicated to the preservation of historic architecture.
To learn more visit: www.architecturaltrust.org
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