Substitute House Bill No. 5190
Public Act No. 24-109
AN ACT CONCERNING THE HISTORIC HOMES REHABILITATION
TAX CREDIT.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 10-416 of the 2024 supplement to the general
statutes is repealed and the following is substituted in lieu thereof
(Effective July 1, 2024, and applicable to taxable and income years commencing
on or after January 1, 2024):
(a) As used in this section, the following terms shall have the
following meanings unless the context clearly indicates another
meaning:
(1) "Department" means the Department of Economic and
Community Development;
(2) "Historic home" means a building that: (A) Will contain one-to-
four dwelling units of which at least one unit will be occupied as the
principal residence of the owner for not less than five years following
the completion of rehabilitation work, and (B) is (i) listed individually
on the National or State Register of Historic Places, or (ii) located in a
district listed on the National or State Register of Historic Places, and
has been certified by the department as contributing to the historic
character of such district; Substitute House Bill No. 5190
Public Act No. 24-109 2 of 6
(3) "Nonprofit corporation" means a nonprofit corporation
incorporated pursuant to chapter 602 or any predecessor statutes
thereto, having as one of its purposes the construction, rehabilitation,
ownership or operation of housing and having articles of incorporation
approved by the Commissioner of Economic and Community
Development in accordance with regulations adopted pursuant to
section 8-79a or 8-84;
(4) "Owner" means (A) any taxpayer filing a state of Connecticut tax
return who possesses title to an historic home, or prospective title to an
historic home in the form of a purchase agreement or option to
purchase, or (B) a nonprofit corporation that possesses such title or
prospective title;
(5) "Qualified rehabilitation expenditures" means any costs incurred
for the physical construction involved in the rehabilitation of an historic
home, but excludes: (A) The owner's personal labor, (B) the cost of site
improvements, unless to provide building access to persons with
disabilities, (C) the cost of a new addition, except as may be required to
comply with any provision of the State Building Code or the Fire Safety
Code, (D) any cost associated with the rehabilitation of an outbuilding,
unless such building contributes to the historical significance of the
historic home, and (E) any nonconstruction cost such as architectural
fees, legal fees and financing fees;
(6) "Rehabilitation plan" means any construction plans and
specifications for the proposed rehabilitation of an historic home in
sufficient detail to enable the department to evaluate compliance with
the standards developed under the provisions of subsections (b), (c) and
(m) of this section; and
(7) "Occupancy period" means a period of five years during which
one or more owners occupy an historic home as such owner's or owners'
primary residence. The occupancy period begins on the date the tax Substitute House Bill No. 5190
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credit voucher is issued by the Department of Economic and
Community Development.
(b) The Department of Economic and Community Development shall
administer a system of tax credit vouchers within the resources,
requirements and purposes of this section for owners rehabilitating
historic homes or taxpayers making contributions to qualified
rehabilitation expenditures. Any owner shall be eligible for a tax credit
voucher in an amount equal to thirty per cent of the qualified
rehabilitation expenditures.
(c) The department shall develop standards for the approval of
rehabilitation of historic homes for which a tax credit voucher is sought.
Such standards shall take into account whether the rehabilitation of an
historic home will preserve the historic character of the building.
(d) Prior to beginning any rehabilitation work on an historic home,
the owner shall submit a rehabilitation plan to the department for a
determination of whether such rehabilitation work meets the standards
developed under the provisions of subsections (b), (c) and (m) of this
section and shall also submit to the department an estimate of the
qualified rehabilitation expenditures.
(e) If the department certifies that the rehabilitation plan conforms to
the standards developed under the provisions of subsections (b), (c) and
(m) of this section, the department shall reserve for the benefit of the
owner an allocation for a tax credit equivalent to thirty per cent of the
projected qualified rehabilitation expenditures.
(f) Following the completion of rehabilitation of an historic home, the
owner shall notify the department that such rehabilitation has been
completed. The owner shall provide the department with
documentation of work performed on the historic home and shall certify
the cost incurred in rehabilitating the home. The department shall Substitute House Bill No. 5190
Public Act No. 24-109 4 of 6
review such rehabilitation and verify its compliance with the
rehabilitation plan. Following such verification, the department shall
issue a tax credit voucher to either the owner rehabilitating the historic
home or to the taxpayer named by the owner as contributing to the
rehabilitation. The tax credit voucher shall be in an amount equivalent
to the lesser of (1) the tax credit reserved upon certification of the
rehabilitation plan under the provisions of subsection (e) of this section,
or (2) thirty per cent of the actual qualified rehabilitation expenditures.
In order to obtain a credit against any state tax due that is specified in
subsection (i) of this section, the holder of the tax credit voucher shall
file the voucher with the holder's state tax return.
(g) Before the department issues a tax credit voucher, the owner shall
deliver a signed statement to the department that provides that: (1) The
owner shall occupy the historic home as the owner's primary residence
during the occupancy period; (2) the owner shall convey the historic
home to a new owner who will occupy it as the new owner's primary
residence during the occupancy period; or (3) an encumbrance shall be
recorded, in favor of the local, state or federal government or other
funding source, that will require the owner or the owner's successors to
occupy the historic home as the primary residence of the owner or the
owner's successors for a period equal to or longer than the occupancy
period. A copy of any such encumbrance shall be attached to the signed
statement.
(h) The owner of an historic home shall not be eligible for a tax credit
voucher under subsections (b), (c) and (m) of this section, unless the
owner incurs qualified rehabilitation expenditures exceeding fifteen
thousand dollars.
(i) (1) The Commissioner of Revenue Services shall grant a tax credit:
(A) (i) For a taxpayer holding a tax credit voucher issued prior to
January 1, 2024, under subsections (d) to (h), inclusive, of this section, Substitute House Bill No. 5190
Public Act No. 24-109 5 of 6
against any tax due under chapter 207, 208, 209, 210, 211 or 212 in the
amount specified in the tax credit voucher.
(ii) Any unused portion of such credit under this subparagraph may
be carried forward to any or all of the four income years following the
year in which the tax credit voucher is issued; and
(B) (i) For a taxpayer [described under subparagraph (A) of
subdivision (4) of subsection (a) of this section] holding a tax credit
voucher issued on or after January 1, 2024, under subsections (d) to (h),
inclusive, of this section, against [the] any tax due under chapter 207,
208, 208a, 209, 210, 211, 212 or 229 in the amount specified in the tax
credit voucher.
(ii) If a taxpayer described under subparagraph (A) of subdivision (4)
of subsection (a) of this section holding such tax credit voucher claims a
credit against the tax imposed under chapter 229 and the amount of the
tax credit voucher exceeds the taxpayer's liability for [the] such tax,
[imposed under chapter 229,] the Commissioner of Revenue Services
shall treat such excess as an overpayment and, except as provided under
section 12-739 or 12-742, shall refund the amount of such excess, without
interest, to the taxpayer. [; and]
[(C) (i) For an owner that is a nonprofit corporation holding a tax
credit voucher issued on or after January 1, 2024, under subsections (d)
to (h), inclusive, of this section, against the tax due under chapter 208a
in the amount specified in the tax credit voucher.]
[(ii) Any] (iii) If a taxpayer holding such tax credit voucher claims a
credit against any tax imposed under chapter 207, 208, 208a, 209, 210,
211 or 212, any unused portion of such credit under this subparagraph
may be carried forward to any or all of the four income years following
the year in which the tax credit voucher is issued.
(2) The Department of Economic and Community Development shall Substitute House Bill No. 5190
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provide a copy of the voucher to the Commissioner of Revenue Services
upon the request of said commissioner.
(j) A credit allowed under this section shall not exceed thirty
thousand dollars per dwelling unit for an historic home, except that
such credit shall not exceed fifty thousand dollars per such dwelling
unit for an owner that is a nonprofit corporation.
(k) The tax credit granted under subsection (i) of this section shall be
taken in the same tax year in which the tax credit voucher is issued.
(l) The aggregate amount of all tax credits that may be reserved by
the Department of Economic and Community Development upon
certification of rehabilitation plans under subsections (b) to (d),
inclusive, of this section shall not exceed three million dollars in any one
fiscal year. On and after July 1, 2015, seventy per cent of the tax credits
reserved pursuant to this section shall be for owners rehabilitating
historic homes that are located in a regional center as designated in the
state plan of conservation and development adopted by the General
Assembly pursuant to section 16a-30 or taxpayers making contributions
to qualified rehabilitation expenditures on historic homes that are
located in a regional center as designated in the state plan of
conservation and development adopted by the General Assembly
pursuant to section 16a-30.
(m) The Department of Economic and Community Development
may, in consultation with the Commissioner of Revenue Services, adopt
regulations in accordance with chapter 54 to carry out the purposes of
this section.