Historical September–October 1998 article. Dates, prices, services and contacts describe the source period; current availability has not been established.
Property owners engaged in rehab projects within the Skinker-DeBaliviere Historic District could be eligible for some big savings this year.
A new state law created for the first time the availability of State Historic Tax Credits, available for commercial and residential use, including homeowners. Unlike the Federal tax credits for rehab, homeowners are eligible to take credits on their state income tax for eligible rehab costs incurred after January 2, 1998.
It is anticipated that the new legislation will encourage rehab and stimulate development of historic areas. Key to the success of this legislation was building consensus among both urban and rural legislators.
The “Main Streets” in several outstate communities will thus benefit from the new Law, as will historic neighborhoods such as ours.
In fact, the legislation is immediately effective for buildings in 28 eligible tax credit districts in St. Louis, including Skinker-DeBaliviere/Catlin Tract/ Park-view Historic District and the Central West End. Our area’s buildings do not have to be certified individually, since the whole district is already certified. Overall, the law affects buildings which are either 1) in a local district certified on the National Register of Historic Places, 2) in a local district certified by the U.S. Department of Interior, or 3) a building which is individually listed on the National Register of Historic Places.
These key elements of the legislation determine whether your rehab project is eligible: 1. Rehab costs must exceed 50% of the cost of the building.
If you plan to put $ 40,000 into rehab, and you purchased the house for anywhere between $ 1 and $ 79,000, that would qualify.
However, if you purchased a house for $ 125,000 and put $ 20,000 into rehab, that would not qualify. 2. Tax credit is 25% of the cost of rehab.
For example, a $ 40,000 rehab would have a $ 10,000 tax credit. 3. Tax credit can be used to offset taxes in the current year, back three years, and forward up to 10 years.
For example, for the $ 10,000 tax credit above, a person making $ 55,000 per year pays 6% state income taxes of $ 3,300.
The homeowner could get a credit for $ 3,300 in the current year and each of. the past 3 years to receive a cash refund of $ 9,900, then use the remaining $ 100 balance in the following year, for a total tax credit of $ 10,000. 4. Tax credits can be used by individuals, corporations, or partnerships and can be sold or exchanged. 5. Tax credits must receive preliminary approval from the Department of Economic Development and the State Historic Preservation Office.. Afterpreliminary approval is granted, work can begin.
After work is complete and documentation submitted, the state issues a certificate for inclusion with your state income tax returns.
As a homeowner, you may be planning work to your home which would easily qualify for the tax credits.
On the other hand, you should think carefully about the consequences of proposed work which might not be approved.
For example, removing or altering distinctive features that were original to the building would be rejected. Moreover, the rule of thumb is that deteriorated historic features should be repaired rather than replaced.
If the deterioration is severe and replacement is required, then the new feature should match the old in design, color, texture, and, where possible, materials. And remember, new additions don’t qualify as rehab, so the cost of building a room addition would be subtracted from the basis. And if adding, say, a “Florida Room” would substantially change historic features of your property, the whole application might be denied.
The application process may be rigorous, but definitely worth the trouble, says long-time neighbor and Feinberg Real Estate agent Rennie Shuter, who has been working with architects George Johannes and Tom Cohen while going through the process for obtaining approval for the renovations at the Shuter home in Parkview. Homeowners or building developers interested in applying for these credits can obtain an application from the State Historic Preservation Office, P.O. Box 176, Jefferson City, Missouri 65102.
The telephone number for Claire Blackwell, State Historic Preservation Officer, is 573-751-7857. Neighborhood residents may also contact Jo Ann Vatcha at Operation Impact, 622-3400.
Originally published in The Times of Skinker-DeBaliviere, September–October 1998.
Read this article in the original newspaper issue.
Archival transcription note: Source tax example says current year and each of three past years, but gives $9,900 total at $3,300 per year; wording retained without silently correcting arithmetic.
Original source: SD_Times1998_09.pdf, printed page(s) 4; PDF page(s) 4.
