West Virginia’s historic tax rehabilitation credit is now permanent. Gov. Jim Justice recently signed the bi-partisan bill, which provides a 25% tax credit for those who rehabilitate income-producing properties.
The 25% credit, which became law in 2018, was set to expire at the end of 2022. In those five years, the program attracted renewed interest in West Virginia’s historic commercial districts and spurred private reinvestment in more than 80 vacant and dilapidated buildings throughout the state. In just two of those years, more than $34 million were invested in nine projects.
The move to a permanent 25% credit provides needed certainty to property owners and developers, explained Renee Kuhlman, Senior Director at the National Trust for Historic Preservation. The 25% credit often fills a financing gap in a project, but the uncertainty around its future made it difficult for developers to successfully apply for construction loans or plan long-term projects.
“The removal of the sunset date increases the attractiveness of the credit to investors,” Kuhlman said. “Already, I’ve received a call from a New Orleans developer wanting information about West Virginia properties because the program was made permanent.”
Subscribe to Weelunk
Without this tax credit, many historic redevelopment projects would not happen, explained Danielle Parker, executive director of the Preservation Alliance of West Virginia, a statewide organization dedicated to supporting and promoting historic preservation. The 25% credit fills a financing gap, and it is often the reason a project becomes feasible.
“There are over 1,000 properties, including 168 historic districts, that can be revitalized using the credit, and I am excited to see how these places can be brought back to life using this financial incentive,” Parker said.
The state historic tax credit is capped at $30 million of income tax credits per year. The program also offers a 20% residential rehabilitation credit for historic homes, which has also been made permanent. The WV Historic Preservation Office and the National Parks Service administer the state historic tax credit program. For more information on applying for the credit, please call 304-558-0240.