§ 47:6019 — Tax credit; rehabilitation of historic structures

Louisiana § 47:6019

• Jurisdiction: Louisiana
• Title 47: Revenue and Taxation

Text

§6019. Tax credit; rehabilitation of historic structures
A.(1)(a)(i) There shall be a credit against income tax for the amount of eligible costs
and expenses incurred during the rehabilitation of a historic structure located in a downtown
development district, located in a cultural district, or contributing to the National Register
of Historic Places. The amount of the credit shall equal twenty-five percent of the eligible
costs and expenses of the rehabilitation incurred prior to January 1, 2018, regardless of the
year in which the property is placed in service. The amount of the credit shall equal twenty
percent of the eligible costs and expenses of the rehabilitation incurred on or after January
1, 2018, and before January 1, 2023, regardless of the year in which the property is placed
in service. The amount of the credit shall equal twenty-five percent of the eligible costs and
expenses of the rehabilitation incurred on or after January 1, 2023, and before January 1,
2029, regardless of the year in which the property is placed in service. No credit is
authorized pursuant to this Section for expenses incurred on or after January 1, 2029.
(ii) For the rehabilitation of a historic structure that meets the requirements of Item
(i) of this Subparagraph and is located in a rural area, the amount of the credit shall equal
thirty-five percent of the eligible costs and expenses of the rehabilitation incurred on or after
January 1, 2023, and before January 1, 2029.
(b) The tax credit for qualified rehabilitation expenditures is earned only in the year
in which the property attributable to the expenditures is placed in service. The amount of the
tax credit shall be determined according to the values provided for in Subparagraph (a) of
this Subsection.
(c) No taxpayer, or any entity affiliated with such taxpayer, shall claim more than
five million dollars of credit annually for any number of structures rehabilitated with a
particular downtown development or cultural district.
(d) The tax credit shall not be allowed for the rehabilitation costs and expenses that
are paid for with state or federal funds, unless the state or federal funds are reported as
taxable income or are structured as repayable loans.
(e)(i) For State of Louisiana Commercial Rehabilitation Tax Credit Part 2
applications received by the Department of Culture, Recreation and Tourism on or after
January 1, 2021, but prior to January 1, 2025, the maximum aggregate total of tax credits that
may be reserved by all taxpayers pursuant to the provisions of this Section shall not exceed
one hundred twenty-five million dollars annually and if the amount of tax credit reservations
issued in a calendar year is less than one hundred twenty-five million dollars, the excess
reservation amount shall be available for issuance in any subsequent calendar year.
(ii) For State of Louisiana Commercial Rehabilitation Tax Credit Part 2 applications
received by the Department of Culture, Recreation and Tourism on or after January 1, 2025,
the maximum aggregate total of tax credits that may be reserved by all taxpayers pursuant
to the provisions of this Section shall not exceed eighty-five million dollars annually.
(iii) The Department of Culture, Recreation and Tourism shall establish by rule the
method of reserving available tax credits including but not limited to a first-come,
first-served system or any other method that the Department of Culture, Recreation and
Tourism determines to be beneficial to the program. Rules promulgated pursuant to the
provisions of this Subparagraph shall be subject to oversight by the House Committee on
Ways and Means and the Senate Committee on Revenue and Fiscal Affairs. The Department
of Revenue and the Department of Culture, Recreation and Tourism shall make reasonable
efforts to post a listing of estimated credit amounts remaining under the annual cap on their
websites.
(2)(a) In order to qualify for the credit, the historic structure located in the downtown
development or cultural district shall also be listed on the National Register of Historic
Places or be certified by the state historic preservation office as contributing to the historical
significance of the district.
(b) Eligible structures must be nonresidential real property or residential rental
property.
(c) A single fee shall be charged per application by the state historic preservation
office and the Department of Revenue, the amount of which shall be determined in rules and
regulations promulgated by the Department of Culture, Recreation and Tourism, in
consultation with the Department of Revenue, in accordance with the Administrative
Procedure Act, subject to oversight by the House Committee on Ways and Means and the
Senate Committee on Revenue and Fiscal Affairs. The rules and regulations promulgated
in accordance with the provisions of this Section shall provide for an equitable distribution
of the application fee between the state historic preservation office and the Department of
Revenue.
(3)(a) The credit shall be allowed against the income tax for the taxable period in
which the credit is earned. If the tax credit allowed pursuant to this Section exceeds the
amount of taxes due, any unused credit may be carried forward as a credit against subsequent
tax liability for a period not to exceed five years. This credit may be used in addition to the
twenty percent federal tax credit for such purposes.
(b)(i)(aa) Persons who are awarded tax credits may elect to sell their unused tax
credits to one or more individuals or entities. The tax credits may be transferred or sold by
a taxpayer or any subsequent transferee an unlimited number of times.
(bb) The transfer of the credit does not extend the carry forward period of the credit.
(cc) Transferors and transferees shall submit to the Department of Revenue in
writing a notification of any transfer or sale of tax credits within ten business days after the
transfer or sale of such tax credits. The notification shall be accompanied by a tax credit
transfer processing fee, the amount of which shall be determined in rules and regulations
promulgated by the Department of Revenue, in accordance with the Administrative
Procedure Act, subject to oversight by the House Committee on Ways and Means and the
Senate Committee on Revenue and Fiscal Affairs. A "transfer", for purposes of the fee
requirement, means an assignment, disposition, transfer, or allocation of tax credits. The
notification shall include the transferor's tax credit balance prior to transfer, the credit
identification number assigned by the state historic preservation office, the remaining balance
after transfer, all federal and Louisiana tax identification numbers for both transferor and
transferee, the date of transfer, the amount transferred, and any other information required
by the Department of Revenue. Failure to comply with this notification provision will result
in the disallowance of the tax credit until the parties are in full compliance.
(ii)(aa) All entities taxed as corporations for Louisiana income tax purposes shall
claim any credit allowed under this Section on their corporation income tax return.
(bb) Individuals shall claim any credit allowed under this Section on their individual
income tax return.
(cc) Estates or trusts shall claim any credit allowed under this Section on their
fiduciary income tax returns.
(dd) Entities not taxed as corporations shall claim any credit allowed under this
Section on the returns of the partners or members as follows:
(I) Corporate partners or members shall claim their share of the credit on their
corporation income tax returns.
(II) Individual partners or members shall claim their share of the credit on their
individual income tax returns.
(III) Partners or members that are estates or trusts shall claim their share of the credit
on their fiduciary income tax returns.
B.(1) For purposes of this Section, the following words and phrases shall have the
meanings ascribed to them in this Paragraph:
(a) "Contributing to the National Register of Historic Places" means listed or deemed
as a contributing element within a National Register Historic District as determined by the
National Park Service.
(b) "Cultural district" shall mean a district designated by a local governing authority
in accordance with law for the purpose of revitalizing a community by creating a hub of
cultural activity, including affordable artist housing and workspace. The Department of
Culture, Recreation and Tourism shall develop standard criteria for cultural districts. Such
criteria shall include that the district must be geographically contiguous and distinguished
by cultural resources that play a vital role in the life and cultural development of a
community. The district shall focus on a cultural compound, a major art institution, art and
entertainment businesses, an area with arts and cultural activities or cultural or artisan
production and be engaged in the promotion, preservation, and educational aspects of the arts
and culture of the locale and contribute to the public through interpretive and educational
uses. The Department of Culture, Recreation and Tourism may determine whether or not a
district complies with this definition.
(c) "Downtown development district" shall mean a downtown development district
or central business development district created by law, pursuant to law, or by ordinance
adopted prior to January 1, 2002, in a home rule charter municipality.
(d) "Eligible costs and expenses" shall mean qualified rehabilitation expenditures as
defined in Section 47c(2)(A) of the Internal Revenue Code of 1986, as amended, except that
"substantially rehabilitated" shall mean that the qualified rehabilitation expenditures must
exceed ten thousand dollars.
(e) "Rural area" means any of the following:
(i) A parish of this state with a population of less than one hundred thousand
according to the most recent federal decennial census.
(ii) A municipality of this state with a population of less than thirty-five thousand
according to the most recent federal decennial census.
(iii) An unincorporated area of a parish of this state, which parish has a population
of one hundred thousand or more according to the most recent federal decennial census.
(2) Federal law terms. Except as otherwise provided or clearly appearing from the
context, any term used in this Section shall have the same meaning as when used in a
comparable context in federal law.
C. The provisions of this Section shall be effective for taxable years ending prior to
January 1, 2029.
NOTE: Acts 2002, No. 60, §3, provides that the Act is effective for all
taxable periods ending prior to Jan. 1, 2005. Acts 2004, 1 st Ex. Sess., No. 12,
§1, extends this applicability to all taxable years ending before Jan. 1, 2008.
NOTE: See Acts 2024, 3 rd Ex. Sess., No. 5, §4, regarding applicability to franchise
tax periods beginning on or after Jan. 1, 2026.

Legislative History

Acts 2002, No. 60, §1, eff. July 1, 2002, for all taxable years ending prior to Jan. 1, 2005; Acts 2005, No. 439, §1, eff. July 11, 2005; Acts 2007, No. 298, §1; Acts 2009, No. 444, §1, eff. July 8, 2009; Acts 2011, No. 409, §1, eff. July 6, 2011; Acts 2013, No. 263, §1, eff. June 13, 2013; Acts 2013, No. 418, §1, eff. June 21, 2013; Acts 2014, No. 825, §1, eff. July 1, 2014; Acts 2015, No. 108, §1, eff. June 19, 2015; Acts 2017, No. 403, §2, eff. June 26, 2017; Acts 2020 1 st Ex. Sess., No. 25, §1, eff. July 1, 2020; Acts 2023, No. 426, §1; Acts 2024, 3rd Ex. Sess., No. 5, §1, eff. Jan. 1, 2025; Acts 2024, 3rd Ex. Sess., No. 6, §1, eff. Jan. 1, 2026; Acts 2024, 3rd Ex. Sess., No. 11, §2, eff. Dec. 4, 2024.