Historic Tax Credit Growth and Opportunity Act of 2025

Key Points

• The bill increases the federal tax credit for smaller renovation projects from 20% to 30%. This higher rate applies to projects costing up to $3.75 million, or up to $5 million if the building is located in a rural area.
• It changes the timing of the tax break so owners get the full benefit immediately. Currently, the credit is spread out over five years, but this plan would allow developers to claim the entire amount in the year the building opens.
• The plan makes it easier for more buildings to qualify for help. It cuts the 'substantial rehabilitation' requirement in half, meaning owners don't have to spend as much money on construction relative to the building's value to get the credit.
• For small projects, the bill allows owners to sell their tax credits to other people or businesses. This helps developers get cash upfront to pay for construction costs rather than waiting until they file their taxes.
• The bill removes a rule that currently forces owners to lower the value of their property on paper when they take the credit. By removing this rule, owners can save more money on their taxes over time through standard building depreciation.
• It relaxes rules for non-profit organizations, making it easier for groups like community centers or local charities to partner with developers to save historic buildings in their neighborhoods.

Impact Analysis

Govbase has not yet run an impact analysis on this legislation.