Historic Rehabilitation Credit

How it works

The Historic Rehabilitation Credit is overseen by the Virginia Department of Historic Resources (DHR). It applies to rehabilitation projects on certified historic structures.

What the money covers

• The credit equals 25% of eligible expenses for the project.
• You can claim a credit of up to $7.5 million on your return.
• The credit cannot exceed your tax liability.
• Unused credits may be carried forward for 10 years.
• The credit may also be claimed against certain utilities taxes administered by the State Corporation Commission.

Amounts and caps

• DHR certifies the work for the credit.
• The rehabilitation cost must meet a minimum threshold: at least 50% of the assessed value of the structure before rehabilitation, or 25% if you live in the structure.

What counts as rehabilitation

• Fixing up the structure so you can continue using it while maintaining its historic character.
• Work done so the structure can be used for a new purpose.
• The work must meet the Secretary of the Interior’s Standards for Rehabilitation.
• Generally, structural work or certain site work necessary to rehabilitate the structure may qualify.
• Most enlargements and additions do not qualify.

How to apply

You must have the credit certified by DHR and follow its application process on the DHR website.

How to claim it

Attach the proper schedule to the return for the year DHR certified the rehabilitation:

• Schedule CR for individual and fiduciary returns
• Form 500CR for corporate returns
• Schedule 502 ADJ for pass-through entity returns
• Schedule 800CR for insurance premiums license tax returns

Timing and deadlines

• The credit is claimed for the year DHR certifies the rehabilitation.
• For pass-through entities, Form TCA must be completed within 30 days of the credit certification, but at least 90 days before filing the income tax return.