Kentucky Historic Property Tax Credits
Yes, Kentucky offers tax credits for rehabilitating historic properties through two main programs:
1. Kentucky Historic Preservation Tax Credit
- Provides up to 30% of qualified rehabilitation expenses for owner-occupied residential properties
- Offers up to 20% for commercial properties and other buildings
- Maximum credit is $60,000 per project for residential properties
- No cap for commercial projects
2. Federal Historic Rehabilitation Tax Credit
- 20% tax credit for income-producing historic properties
- Property must be listed on National Register of Historic Places
- Rehabilitation must meet Secretary of Interior’s Standards
Key Requirements
- Property must be certified historic structure
- Minimum investment must be $20,000
- Work must be completed within 24 months
- Project must be pre-approved by Kentucky Heritage Council
Frequently Asked Questions
Q: Can I combine state and federal tax credits?
Yes, qualified projects can utilize both Kentucky and federal tax credits simultaneously.
Q: What types of properties qualify?
Properties listed on the National Register or contributing to historic districts qualify.
Q: Is there a deadline to apply?
Applications are accepted annually by April 29 for certification in the current calendar year.
Q: Are the credits refundable?
No, Kentucky historic tax credits are not refundable but can be carried forward for up to seven years.
Q: What expenses qualify?
Qualified expenses include structural work, repairs, HVAC, electrical, and plumbing systems.
Q: How long does approval take?
The review process typically takes 30-60 days after submission of a complete application.
Q: Can I sell or transfer the credits?
Kentucky historic tax credits are not transferable but may be allocated among partners in a partnership.
The Bottom Line
Kentucky’s historic tax credit programs offer significant financial incentives for rehabilitating historic properties. When combined with federal credits, these programs can make restoration projects more financially viable while helping preserve Kentucky’s architectural heritage. However, careful planning and compliance with program requirements are essential for success.