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1998 SESSION
Be it enacted by the General Assembly of Virginia:
1. That § 58.1-339.2 of the Code of Virginia is amended and reenacted as follows:
§ 58.1-339.2. Historic rehabilitation tax credit.
A. Effective for taxable years beginning on and after January 1, 1997, any
individual, trust or estate, or corporation incurring eligible expenses in the
rehabilitation of a certified historic structure shall be entitled to a credit
against the tax imposed by §§ Articles 2
(§ 58.1-320 et seq.), 6 (§ 58.1-360
et seq.) or and 10 (§ 58.1-400 et
seq.) of Chapter 3; Chapter 12 (§ 58.1-1200 et seq.); Article 1 (§
58.1-2500 et seq.) of Chapter 25; and Article 2 (§ 58.1-2620 et seq.) of
Chapter 26 of this title, in accordance with the following schedule:
Year % of Eligible Expenses
1997 10%
1998 15%
1999 20%
2000 and thereafter 25%
If the amount of such credit exceeds the taxpayer's tax liability for such
taxable year, the amount that exceeds the tax liability may be carried over for
credit against the income taxes of such taxpayer in the next five
taxable years or until the full credit is used, whichever occurs first. Credits
granted to a partnership or electing small business corporation (S corporation)
shall be passed through to the partners or shareholders, respectively.
B. To claim the credit authorized under this section, the taxpayer shall apply
to the Virginia Department of Historic Resources, which shall determine the
amount of eligible rehabilitation expenses and issue a certificate thereof to
the taxpayer. The taxpayer shall attach the certificate to the Virginia
income tax return on which the credit is claimed.
C. When used in this section:
"Certified historic structure" means a property listed individually on the Virginia Landmarks Register, or certified by the Director of the Virginia Department of Historic Resources as contributing to the historic significance of a historic district that is listed on the Virginia Landmarks Register or certified by the Director of the Virginia Department of Historic Resources as meeting the criteria for listing on the Virginia Landmarks Register.
"Eligible rehabilitation expenses" means expenses incurred in the material rehabilitation of a certified historic structure and added to the property's capital account.
"Material rehabilitation" means improvements or reconstruction consistent with "The Secretary of the Interior's Standards for Rehabilitation," the cost of which amounts to at least fifty percent of the assessed value of such building for local real estate tax purposes for the year before such rehabilitation expenses were incurred.
D. The Director of the Department of Historic Resources shall establish by regulation the requirements needed for this program, including the fees to defray necessary expenses thereof.