Federal Historic Tax Credit: Compliance Requirements

Submit NPS Form 10-168 Part 3 (Request for Certification of Completed Work) within 30 months after placing the property in service, accompanied by before-and-after photographs and documentation that completed rehabilitation meets the Secretary of the Interior's Standards for Rehabilitation.

Deadline: Within 30 months of placing property in service; failure to receive NPS certification within 30 months triggers IRS notification requirement

Source: IRS FAQ on Rehabilitation Credit; 36 CFR 67; 12 CFR 1.48-12(d)(7)

Claim the credit on IRS Form 3468 (Investment Credit), filed with the first tax return after NPS Part 3 certification is received; include NPS project number and certification date.

Deadline: File with first tax return after receiving NPS certification; credit claimed ratably over 5 years post-2017, or in full in placed-in-service year under transition rules

Source: IRS Form 3468 Instructions; IRC 47; Treas. Reg. 1.48-12(f)

Submit amendments to NPS for any material changes to the rehabilitation work plan after Part 2 approval and before or during construction.

Deadline: Prior to implementing changes to approved Part 2 work scope

Source: NPS application guidance; 36 CFR 67

Submit independent certified public accountant review of all project expenses with Part 3 application: projects under $500,000 use Agreed-Upon Procedures Report; projects $500,000+ use Illustrative Audit Report.

Deadline: Concurrently with Part 3 application submission (within 30 months of placed-in-service date)

Source: Virginia DHR Financial Certification Requirements; NPS guidance on Part 3 submissions

Ensure qualified rehabilitation expenditures do not include acquisition costs, costs of additions or enlargements, personal property (appliances), site work, landscaping, or legal fees for syndication; only capital improvements to the building's structural components and certain soft costs (architecture, engineering, construction management) qualify.

Deadline: Apply throughout project cost accounting and CPA review process

Source: IRC 47(c)(2); Virginia DHR Tax Credit guidance; IRS regulations on eligible expenses

Ensure completed rehabilitation maintains historic character by complying with Secretary of the Interior's Standards for Rehabilitation in all aspects of structural, material, and feature preservation work.

Deadline: Throughout rehabilitation; NPS Part 3 review at completion determines compliance

Source: NPS Application Process; 36 CFR 67; Secretary of the Interior's Standards for Rehabilitation

Maintain documentation that qualified rehabilitation expenditures meet IRC 47(c)(2) definition and were incurred during the 24-month (or elected 60-month) measurement period; retain supporting receipts, invoices, and evidence that work was properly capitalized to building assets.

Deadline: Maintain throughout statute of limitations (generally 3 years from tax return filing, potentially longer for credit claims)

Source: IRC 47(c)(1)(B); Treas. Reg. 1.48-12; IRS Rehabilitation Credit FAQs

Retain evidence that at least 75% of external walls remain in place as either exterior or interior walls, at least 50% remain as external walls, and at least 75% of internal structural framework remains in place (Wall Retention Test), documented through architectural plans, photos, and engineer certifications.

Deadline: Substantiate upon Part 3 submission; maintain documentation indefinitely for audit defense

Source: IRC 47(c)(1)(C); NPS eligibility requirements; 36 CFR 67

Submit NPS Form 10-168 Part 1 (Evaluation of Significance) before placing the building in service if the property is not individually listed in the National Register of Historic Places, to establish that the building qualifies as a 'certified historic structure.'

Deadline: Before building is placed in service; late submission may trigger IRS relief request under Treas. Reg. 301.9100-1 through 301.9100-3

Source: IRS Rehabilitation Credit FAQs; Virginia DHR guidance; 19 CFR 67.2

Maintain the property's income-producing status (commercial, industrial, agricultural, rental residential use) for the duration of the 5-year compliance period after placing the building in service; conversion to tax-exempt status or owner-occupied residential use triggers credit recapture.

Deadline: Throughout 5-year compliance period from placed-in-service date

Source: IRC 50(c); Treasury Regulation 1.48-12(c)(6); Federal Historic Tax Credit recapture rules