National Register of Historic Places - Property Owner Incentives

Property Owner Incentives

Properties are not protected in any strict sense by the Federal listing. States and local zoning bodies may or may not choose to protect listed historic places. Indirect protection is possible, by state and local regulations on development of National Register properties, and by tax incentives.

Until 1976, federal tax incentives were virtually non-existent for buildings on the National Register. Before 1976 the federal tax code favored new construction rather than the reuse of existing, sometimes historical, structures. In 1976, the tax code was altered to provide tax incentives that promote preservation of income-producing historic properties. The National Park Service was given the responsibility to ensure that only rehabilitations that preserved the historic character of a building would qualify for federal tax incentives. A qualifying rehabilitation is one that the NPS deems consistent with the Secretary of the Interior's Standards for Rehabilitation. Properties and sites listed in the Register, as well as those located in and contributing to the period of significance of National Register Historic Districts, became eligible for the federal tax benefits.

Owners of income-producing properties listed individually in the National Register of Historic Places or of properties that are contributing resources within a National Register Historic District may be eligible for a 20% investment tax credit for the rehabilitation of the historic structure. The rehabilitation may be of a commercial, industrial, or residential property, for rentals. The tax incentives program is operated by the Federal Historic Preservation Tax Incentives program, which is managed jointly by the National Park Service, individual State Historic Preservation Offices, and the Internal Revenue Service. Aside from the 20% tax credit, the tax incentive program offers a 10% tax credit for rehabilitation to owners of non-historic, non-residential buildings constructed before 1936.

Some property owners may qualify for grants as well, for instance the Save America's Treasures grants, which apply specifically to properties entered in the Register with national significance or designated as National Historic Landmarks.

The NHPA did not distinguish between properties listed in the National Register of Historic Places and those designated as National Historic Landmarks concerning qualification for tax incentives or grants. This was deliberate, as the authors of the act had learned from experience that distinguishing between categories of significance for such incentives caused the lowest category to become expendable. Essentially, this made the Landmarks a kind of "honor roll" of the most significant properties of the National Register of Historic Places.