Federal Tax Incentive Program
Income tax incentives for the rehabilitation of historic structures are important tools for historic preservation and economic development throughout the United States. A federal income tax credit for the rehabilitation of historic structures first appeared in 1976 and today consists of a 20% credit for the certified rehabilitation of certified historic structures. For more information regarding the Federal Tax Incentive Program, please see the National Park Service website.
State Historic Rehabilitation Tax Credit
The Maine Historic Preservation Commission administers the state historic rehabilitation tax credit in consultation with the Department of Administrative and Financial Services, Bureau of Revenue Services. The Commission strongly recommends that prospective applicants carefully review the program rules and application instructions prior to submitting applications or commencing work.
Maine's State Historic Rehabilitation Tax Credit Program includes the following incentives:
The "Substantial Rehabilitation Credit"
A 25% state credit for any rehabilitation that also qualifies for the 20% federal credit. The rehabilitation must meet all of the requirements of the Federal tax incentive program and the application must be submitted in accordance with the procedures at the following link:
Substantial Rehabilitation Credit
The "Small Project Rehabilitation Credit"
A 25% state credit for the rehabilitation of certified historic structures with certified qualified rehabilitation expenditures of between $50,000 and $250,000. This credit is available to entities that do not claim the federal rehabilitation credit. Applicants must meet all federal tax code qualifications except the substantial investment requirement.
Small Project Rehabilitation Credit
The "Rural Area Rehabilitation Credit Increase"
The State Substantial Rehabilitation Credit is increased to 35% of certified qualified rehabilitation expenditures if the certified historic structure is located in a “rural area” and at least 33% of the aggregate square feet of that structure constitutes apartments, dwellings, or other living accommodations. If the rehabilitation of the certified historic structure is also a “certified affordable housing project”, then the credit allowed is increased an additional 10% to a total of 45%. "Rural area" is defined as an unorganized territory of the State or a municipality that has a population of less than 12,500 inhabitants as determined by the United States Department of Commerce, Bureau of the Census based on the latest decennial census of the United States.
The "Affordable Housing Rehabilitation Credit Increase"
The State Substantial Rehabilitation Credit and the Small Project Rehabilitation Credit may be increased an additional 10% if the rehabilitation project meets certain affordable housing requirements. Please contact the Maine State Housing Authority (MSHA) for additional eligibility requirements.
If you are considering submitting an application, or if you have any questions, please contact:
Mike Johnson
Rehabilitation Tax Credit Coordinator
Maine Historic Preservation Commission
55 Capitol Street
Augusta, ME 04333
PH: 207-287-2949
e-mail: Mike.D.Johnson@maine.gov
If you have specific tax related questions, please contact:
Maine Revenue Services
Business Taxes Section
51 Commerce Center Drive
Augusta, ME 04333
PH: 207-624-9670
e-mail: corporate.tax@maine.gov