Publication

December 11, 2013Client Alert

Wisconsin Doubles Supplemental Historic Rehabilitation Tax Credit

Historic Tax Credits have frequently been used in Wisconsin to assist in financing new development while attempting to preserve the charac­­ter of historic structures. The Governor of Wisconsin just signed a new law substantially increasing this tool. Under prior Wisconsin law, a person could claim an income and franchise tax credit equal to 10% of “qualified rehabilitation expenditures” on certified historic structures located in Wisconsin. The new law now doubles the State tax credit awarded for “qualified rehabilitation expenditures” from 10% to 20% of those costs and broadens the types of structures that are eligible for the credit.

 

Under the new law, a Wisconsin taxpayer may claim an income and franchise tax credit for 20% of the qualified rehabilitation expenses for certified historic structures or 20% of the qualified rehabilitation expenses for qualified rehabilitated buildings (previously, only rehabilitation expenses on certified historic structures were eligible for the Wisconsin tax credit). To claim the credit for certified historic structures or for qualified rehabilitated buildings, both the expenses incurred and the structure or building must meet certain conditions as explained in the law. The new increased credit amount applies if the qualified expenditures are greater than $50,000, and the rehabilitated building is placed into service after December 31, 2012.

 

It is anticipated the increased credit amount will serve as a catalyst for the rehabilitation of older buildings into rejuvenated uses and may assist developers in obtaining loans for such rehabilitation work.

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