Owning a historic home in the Charleston, SC area can provide you with dozens of challenges. But if you are willing to devote your time and money into owning one of these majestic homes, you can receive several tax benefits from the government. Historic buildings have civic value and that means you can be eligible to receive many tax incentives from your local, state, and federal government. Maintaining the upkeep on a historic home is not for everyone, but the benefits can often outweigh the disadvantages. Here are a few of the tax benefits that you may be able to receive by owning historical property:
The National Park Service Tax Break
One of the most common historical property tax breaks is from the NPS or National Park Service. The NPS joins with the IRS to provide the Federal Historic Preservation Tax Incentives Program. This is one of the best ways to claim your home as a historic site and have it listed in the National Register of Historic Places. In order to benefit from federal tax breaks, you will need to get your property listed on the NRHP and provide information on specific plans that you have to do renovations.
State Tax Credits and Other State Incentives
Thirty-one states in the U.S. have adopted tax credits for historic buildings that owners plan to renovate. This can help you to double up on your savings over time. In most states, older historic homes are found in traditional areas like downtown Charleston. Renovating your historic home can sometimes mean that you are taking the first step toward renovating an entire neighborhood, and therefore your state may be willing to foot part of the bill if it means your renovation will draw in more tourists.
While many federal tax incentives are limited to historic business buildings, state tax credits do not have the same limits. This means that you can get a state tax credit for renovating your newly purchased home. And you may not need to be individually listed on the NRHP in order to be eligible for these types of benefits. If your home is part of a historic district you may want to consider finding out more about this particular type of tax credit.
Obtaining a Grant
There are many historic societies and private philanthropic organizations that do whatever they can to properly preserve historic buildings. If you are the owner of a historic home, you may be able to benefit from a grant provided by one of these organizations. Usually these grants will pay for renovations or the overall preservation of a historic home. The grants will usually total a certain percentage of the amount that you spend on the home or in some cases, the grants will pay for the entire cost of the renovation. There are many exceptional grant opportunities that exist for private, public and nonprofit applicants. The best way to find out more about grants that you may be eligible for is to visit your state preservation office or the nearest location of the National Trust for Historic Preservation.
Buying a Historic Home in Charleston, SC
Owning and preserving a historic home in the Charleston area can be a very rewarding process. While there may sometimes be many hoops to jump through in order to get the property in livable condition, there are many tax breaks and credits that can help you get the job done without cleaning out your savings. To find out more about the local grants and state credits that is available to you, contact one of the historic preservation groups in the area: Historic Charleston Foundation & Historic Preservation Society of Charleston.