MASSACHUSETTS DEPARTMENT OF REVENUE REGULATION FACT SHEET

TITLE: 830 CMR 63.38R.1: Massachusetts Historic Rehabilitation Tax Credit.

SUMMARY OF REGULATION: The Historic Rehabilitation Tax Credit provides state transferable tax credits over six calendar years beginning in 2005, for the rehabilitation of qualified historic structures in Massachusetts. The annual authorized amount of credits has changed several times due to legislative action, but as of the filing of this Fact Sheet averages $50 million per year. Both corporate excise and personal income tax taxpayers can qualify for the tax credit. The Massachusetts Historic Commission will administer the application and certification process for determining qualified rehabilitation projects. The regulation sets forth the criteria utilized by the Commission to assess each rehabilitation project's contribution to the historical significance of the area and the relative public benefit of its proposed rehabilitation to the Commonwealth. The Commission is responsible for allocating the annual authorized amount of credits among one or many chosen projects, subject to the limitation that the maximum credit allowed for a chosen project is 20% of its qualified rehabilitation expenditures. The regulation covers the following subject matters: (1) a three-tiered certification procedure, (2) the allowance of a five-year credit carryforward, (3) the ability of taxpayers to sell or transfer their credits to any corporate excise or personal income tax taxpayer, and (4) the calculation of a recapture tax if the taxpayers sell their interest in the rehabilitation project within five years of qualifying for the credit.

REGULATORY HISTORY:
Emergency Regulation 4/13/04
Emergency Regulation 7/1/04
Emergency Regulation 9/29/04
Regulation Promulgated 12/17/04
Regulation Amended 10/6/06 [sections (1)(a);(3)(b),(d),(e);(4)(b)2.;(6)(a)1,2,3]

PREPARED BY:
Massachusetts Department of Revenue
Rulings and Regulations Bureau
100 Cambridge Street, 7 th Floor
Boston, Massachusetts 02114
(617) 626-3250
FAX: (617) 626-3290