Colorado offers an income tax credit to Colorado resident individuals and C corporations for the preservation and rehabilitation of a qualified historic property. The structure must be at least 50 years old, and must be: a) designated individually or as a contributing property in the State Register of Historic Places; b) designated as a landmark by a certified local government; or c) designated as a contributing property in a designated historic district of a certified local government. If the property on which a taxpayer wants to claim this credit has none of these designations, the taxpayer must apply for and secure such a designation. [§39-22-514, C.R.S.]
How to Qualify
In order to qualify for the historic preservation income tax credit, a taxpayer must be the property owner or tenant with a lease of five or more years. The project must involve physical rehabilitation work and must preserve the historic character of the building. Qualified rehabilitation costs must exceed $5,000, and the project must be completed within 24 months (one extension of time may be applied for). The project must receive initial approval from the reviewing agency between January 1, 1991 and December 31, 2020, and the taxpayer may claim the tax credit only for work completed by December 31, 2020.
The Colorado Historical Society has adopted regulations governing the criteria and procedures for approval of rehabilitation projects for which the taxpayer intends to claim this tax credit. Reviewing agencies for these projects are the Colorado Historical Society or a certified local government. For detailed information on the approval process, for a list of certified local governments, and for application and certification forms, contact the Colorado Historical Society, Office of Archaeology and Historic Preservation, at www.coloradohistory-oahp.org, or at (303) 866-3395.
If a taxpayer is claiming the federal rehabilitation tax credit for the restoration project (under section 38 of the Internal Revenue Code), no additional approval for state credits is required. The state tax credit may be claimed on the basis of approvals secured for the federal credit.
For more information, see FYI Income 1 on the Colorado website.