State Historic Rehabilitation Tax Credit
Requirements
- The Kansas State Tax Credit is equal to 25 percent of qualifying expenses incurred during a qualified project on a qualified building.
- Buildings must be qualified historic structures. Qualified buildings are those that have been listed on the National Register of Historic Places, the Register of Historic Kansas Places, or have been deemed contributors to a National or State Register Historic District. Projects that qualify and are approved by the National Park Service for the 20 percent Federal Tax Credit will also qualify for the Kansas State Tax Credit.
- Building may be either income-producing or non income-producing. Private residences do qualify for the State Tax Credit.
- Proposed work must follow a qualified rehabilitation plan. Qualified projects are those that have been reviewed and approved by the State Historic Preservation Office (SHPO) through the application process.
- Applications must be approved by the SHPO before work begins.
- Project expenses must exceed $5,000. You may combine smaller projects in order to exceed the minimum requirement.
- All work must meet the Secretary of the Interior's Standards for Rehabilitation This will be determined by the SHPO staff during the application process.
- State Tax Credits may be carried forward for 10 years if you are unable to use all of your credits in one year.
- State Tax Credits may also be transferable to other taxpayers. Please contact the SHPO for more information
Application Process
- Contact the SHPO to obtain applications and to verify that your project will qualify for this program.
Printable version of the application instructions.
Part 1—Qualified Historic Structure Certification (Please save the application form to your computer before filling it out.) - This one-page form is required if your building is located in a National Register or State Register Historic District. The form will be reviewed to verify that your building is a contributor to the character of the historic district. Please be sure to provide good photographs of the front elevation of your property.
Part 2—Qualified Rehabilitation Certification (Please save the application form to your computer before filling it out.) - This form is required for all applicants to certify that the proposed project will meet the Secretary of the Interior's Standards for Rehabilitation. The applicant should outline the building's existing condition and all proposed work on this form. Photographs showing all areas of proposed changes are required to accompany this form. If you are proposing major changes or you are using an architect, additional materials, such as drawings, may be required. The SHPO staff will review the application and materials to certify that all proposed work meets the Standards. The SHPO will advise applicants and provide technical assistance when needed. Work may begin on the proposed project only after this application has been approved by the SHPO.
Once you have an open project on file with the SHPO, any changes to the proposed scope of work must be submitted for approval to the tax review staff via an amendment form before those changes are implemented.
- Application Processing Fee—An application-processing fee is required for the SHPO to review state tax credit applications. Fees are based on the estimated dollar amount of qualified rehabilitation expenditures. Please submit the appropriate fee as noted below with your Part 2 application or as requested by SHPO staff. Fees may be paid online.
Qualified Expenditures Fee
$5,000 - $25,000 $200
$25,001 - $50,000 $350
$50,001 - $100,000 $500
$100,001 - $500,000 $900
$500,001 - $1,000,000 $1,500
over $1,000,000 $2,000
Part 3—Rehabilitation Completion Certification (Please save the application form to your computer before filling it out.) - This form must be submitted when all work has been completed. Photographs of the finished work must accompany the submission. Upon review and approval by the SHPO, applicants will receive a certificate verifying that they may claim 25 percent of their qualified expenses as credit toward their Kansas state income, privilege, or premiums taxes. Qualified expenses are generally those associated with the physical structure of the building, but other soft costs can be applied as well.
Claiming the Kansas State Tax Credit
When the rehabilitation work is complete applicants must submit Part 3 of the application along with Kansas Department of Revenue (KDOR) Schedules I and II. Contact the SHPO or click the following links for instructions and a checklist to help you complete the Schedules.
The KDOR will review and certify the project expenses while the SHPO will review and certify the completed work. A certificate will be issued to the applicant once both agencies complete their reviews. Applicants may claim the State Tax Credit on Department of Revenue Form K-35. Please consult your financial advisor for more information or ask the SHPO staff for a contact at the KDOR. Contact the SHPO if you need further instructions and information.
If the amount of the tax credit exceeds your tax liability for the year in which the property is placed in service, the excess amount may be carried forward for up to 10 years or the excess may be transferred to another taxpayer. Contact SHPO staff for transfer instructions.
Please contact the SHPO for more information or application forms at 785-272-8681, ext. 240 or cultural_resources@kshs.org.
In 2010, the Kansas Preservation Alliance (KPA) contracted with the Center for Urban Policy and Research at Rutgers University to produce an economic impact study of the Kansas State Historic Rehabilitation Tax Credit program. The study was partially funded by a Historic Preservation Fund (HPF) grant from the Kansas Historical Society. Linked below are the full, 40-page report and a smaller executive summary of the study's findings.