Section 40-9F-1 through Section 40-9F-8, Code of Alabama 1975

The 2013 Alabama Historic Rehabilitation Tax Credit provides for an income tax credit against the tax liability of the taxpayer for the rehabilitation, preservation, and development of historic structures. To be eligible for the credit, the property must be certified as a historic structure or a certified historic residential structure. This credit expired in May of 2016; however, entities that received a credit reservation from the Alabama Historic Commission before the expiration of the credit are eligible.

The Alabama Historic Commission (AHC) is the administering agency for this tax incentive. For the historic structures that have been awarded a tax credit by the AHC, the credit must be claimed via My Alabama Taxes. Please see below for more information on how to make the claim.

Provisions of the credit include:

• The credit is available to both income tax and financial institution excise taxpayers.
• The entire credit may be claimed by the taxpayer in the taxable year in which the certified rehabilitation is placed in service. Any unused credit can be carried forward up to 10 years.
• The credit is transferable. Please see below for more information about transferability.
• The credit granted to a partnership, a limited liability company or multiple owners of a property shall be passed through to the partners, members, or owners (including any not-for-profit entity that is a partner, member, or owner) based on their pro rata share or pursuant to an executed agreement.

Transferability of the 2013 Alabama Historic Rehabilitation Tax Credit:

• The owner of a qualified project may transfer all or part of their credit. Once a credit is transferred, only the transferee may utilize the credit, and the credit cannot be transferred again.
• All credit transfers must be approved by ALDOR.
• To transfer the credit, the project owner must submit the following to ALDOR:
  • Transfer statement (Form HRC-TS1);
  • Copy of the tax credit certificate issued by the AHC;
  • Executed transfer agreement; and
  • $1,000 fee per transferee.
•  The project owner must submit the transfer documents during the pre-certification process through My Alabama Taxes.

NOTE! Please make sure that the transfer agreement includes the following required information.

1. Description and address of the project that has been issued a Historic Rehabilitation Tax Credit Certificate.
2. The date the project was placed in service.
3. The amount of the credit being transferred to the transferee.
4. The transferee acknowledges that the recapture of a credit other than a credit that is improperly obtained by the owner, shall apply against the transferee who utilizes the tax credit pursuant to Rule 810-3-136-.03(2), and
5. The transferor is required to notify the transferee of any recapture or related adjustments of the credit within 30 days after the transferor is notified that the credit has been recaptured or adjusted.

To utilize the credit on the income tax return, a credit claim request must be made via My Alabama Taxes.

Additional Resources

• Act 2013-241
• Act 2014-452
• ALDOR Rules
• Alabama Historic Tax Commission Rules
• Transfer Statement Form