How to Get Valuable Tax Breaks with Heritage Homes and Certified Rehabilitations


Rehabilitation tax credits are available for heritage homes and certified rehabilitations. There are guidelines that you need to know before you do any historic remodeling. These guidelines are set by the National Heritage Preservation Service to help preserve and protect historic properties.


A “heritage home” is one that has been designated as having historical value. “Certified rehabilitation” is the alteration of a heritage home while retaining the home’s historic character. You want to qualify for a certified rehabilitation so you will maintain eligibility for the rehabilitation tax credit.


The Secretary of the Interior publishes Standards for the Treatment of Historic Properties. You need to be familiar with these standards to qualify for the tax credits. These are some of the guidelines:


  1. Your home must be used for its original purpose. If, for example, you are rehabilitating an Eichler home, it must be designated as a single-family home to qualify.


  1. Construction and additions must not affect the integrity of the home as it was originally constructed. The form and integrity of the home must not be changed when making additions.


  1. Proposed alterations must retain and preserve the home’s historic character when undertaking historic remodeling. With an Eichler home, you cannot add a second story, place windows in the front walls or do any other changes from the character of the Eichler home.


  1. If your home has historic features that have deteriorated, these should be repaired rather than replaced. If deterioration is severe, it may be replaced, but it must match the original. This means, for example, that worn-out materials need to be replaced with new materials of the same type.


These are four of the 10 guidelines for certified rehabilitations provided by the National Heritage Preservation Service. When doing historic remodeling, follow the guidelines to properly preserve your historic home and to qualify for rehabilitation tax credits.