What is the NYS Homeowner Tax Credit?

-A A +A
NYS Homeowner Tax Credit Questions and Answers
 
DISCLAIMER
The New York State Office of Parks, Recreation and Historic Preservation (OPRHP) does not provide legal, tax or accounting advice; the information provided is intended to be general in nature; and tax credit applicants are strongly encouraged to consult their own professional tax, accounting and
legal advisors on individual tax matters, or consult the NYS Department of Taxation and Finance or the Internal Revenue Service (IRS). OPRHP is not responsible for the information or advice provided here as it may affect the specific tax consequences to any individual (including sole proprietor), corporate, partnership, estate or trust taxpayer, which will depend on many other facts and circumstances. The information is for the general benefit of persons interested in obtaining certifications from OPRHP that may allow them to qualify for federal or state historic properties tax credits. Given the frequency of changes in federal and state tax laws, regulations and guidance, of necessity, the information cannot be expected to be completely current and it represents a good faith effort to reference controlling laws and regulations as accurately as possible.
 
Q. How do I know if my building is listed in the State and/or National Register of Historic Places (NR) or in an NR listed historic district?
 
A. You can find out through the New York State Office of Parks, Recreation and Historic
Preservation (OPRHP) and selecting Online Tools then select the Geographic Information
System for Archeology and National Register (GIS). Select Zoom To Location, then select MUNI your
county and municipality from the drop down menus and click the SUBMIT button. Use the ZOOM and PAN tools to find your location. If your property is located in a RED striped area it is in an NR listed district or individually listed. You can also find some information at the National Park Service. If you need additional assistance, please contact the National Register representative for your area. A list of
representatives can be found by selecting CONTACT at our web site.
 
Q. If my building is not listed in the State and/or National Register of Historic
Places, how do I find out if it can be listed?
 
A. If you need information about listing your property to the Registers, please contact the National Register Representative assigned to your county. A listing can be found at the CONTACT section of our web site, or call 518-237-8643 and ask for the National Register Representative for your county.
 
Q. How do I know if my building is in an eligible census tract?
A. Only certain census tracts qualify for the new NY State Credits. These areas must have median incomes at or below the state median family income. You can find out if your tract qualifies by going to OPRHP and selecting Online Tools and selecting the Geographic Information System for Archeology and National Register (GIS). Select Zoom To Location, then select MUNI your county and municipality from the drop down menus and click the SUBMIT button. Next go to the LAYER menu (lower right corner of screen) and “check” BACKGROUND and the CENSUS TRACT layers (STATE/NATIONAL REGISTER should already be checked), then click the REFRESH button. Use the ZOOM and PAN Tools to find your location. If the area is highlighted in light BLUE it is in a qualifying census tract. Please double check census tract eligibility with staff because the census data can change..
 
Q. I have a rental unit in my house. How can I best utilize the tax credits?
 
A. You can combine the Federal Historic Preservation Investment Tax Credit (for income producing
properties), the State Historic Preservation Commercial Tax credit; which is automatic if you receive the
federal credit, are located in an eligible census tract, and submit the state tax credit fees); and the State Historic Homeownership Tax Credit. This is a somewhat complex process. OPRHP staff can assist you in understanding how it works.
 
Q. When do I take the credit?
 
A. Property owners take the credit in the year in which they receive a Certification of Completion
(COC). The COC is issued after the project is completed and Part 3 of the application is submitted. If Part 3 of the application is not submitted by October 1 in the year in which the applicant wants to take the credit, OPRHP can not guarantee that a COC will be completed in time.
 
Q. What work can I do?
 
A. In general, in order for work to qualify for any of the three state historic preservation tax credits, it needs to preserve the overall historic character of the building. OPRHP reviews the proposed work using the Secretary of the Interior Standards for Rehabilitation as guidance. There is a list of qualified rehabilitation expenditures in the New York State Historic Preservation Homeowner Tax Credit application.  
 
Q. May I replace the windows so that I can make my house more energy efficient if the existing windows are not historic?
A. Yes. However, OPRHP will need to review the proposed replacement windows. Include information about the materials and the design of the proposed replacement windows in the application. The proposed windows should complement the architecture of the historic building. OPRHP might recommend 1over1 replacement double hung sash if you do not know what the original windows looked like. Vinyl or vinyl clad replacement windows on an historic house are generally not acceptable.
 
Q. May I replace the windows so that I can make my house more energy efficient if the existing windows are historic?
 
A. Maybe, if the existing windows are determined by OPRHP to be beyond repair. Because historic windows are often an important feature of historic buildings, OPRHP carefully reviews window replacement proposals.  Proper maintenance and the installation of interior or exterior storm windows will make historic windows energy efficient, often matching the efficiency of new units, while at the same time preserving the historic character of the building. However, there are cases in which the historic windows are beyond repair and replacement is warranted. If you suspect this is the case, include photographic documentation of the window condition in your application for OPRHP to review. If the OPRHP confirms that window replacement is warranted, proposed replacement windows will be reviewed. Include information about the materials and the design of the proposed replacement windows in the application. The proposed windows should match the historic windows very closely. Vinyl or vinyl clad replacement windows on an historic house are generally not acceptable.
 
Q. May I install vinyl siding on my house?
A. No. Vinyl siding is not an appropriate treatment for historic houses because it obscures the original historic wood siding which is an important character defining feature in many historic buildings. In some cases, new siding obscures architectural features.
 
Q. May I replace my roof?
 
A. Yes. Include in the application the current roofing material and what material you propose to install. If the proposed replacement material does not match the historic fabric in kind, it should at least complement the style and materials of the building.
 
Q. Does the tax credit apply to work on mechanical systems?
 
A. Yes.
 
Q. May I repoint my brick walls?
 
A. Yes. Be sure to include in the proposal what type mortar mixture you plan to use and how you will remove existing deteriorated mortar. New mortar must match historic mortar in all qualities including strength, color, texture, and tooling. For information on this topic, read Preservation Brief 2: Repointing Mortar Joints in Historic Masonry Buildings.
 
Q. Does OPRHP only review the work I plan to do on the exterior?
 
A. No. OPRHP reviews all aspects of the project including the interior.
 
Q. Will my tax credit be deferred?
 
A. The tax credit may be subject to deferral. Please visit the New York State Department of Taxation and Finance website at http://www.tax.ny.gov/pdf/memos/multitax/m10_5c_11i.pdf for more information.
Q. Is there a processing fee for my application?
 
A. Yes. Beginning March 23, 2011 a fee structure was established for the processing of applications. More information can be found at www.nysparks.com/shpo/tax-credit-programs.  
 
Q. What expenses are eligible for flood victims?
 
A. According to the New York State Department of Taxation and Finance qualified rehabilitation expenditures under the Historic Homeownership Rehabilitation credit are any amounts "property chargeable to a capital account in connection with a certified rehabilitation of a qualified historic home.” Their counsel and technical staff determined that any reimbursed amounts expended for such rehabilitation (insurance proceeds, FEMA grants, etc) would count as "properly chargeable" under federal basis rules and therefore are qualified expenditures under the credit. Of course, the taxpayer must meet all of the qualifications for the credit.