Rhode Island Code of Regulations
Title 280 - Department of Revenue
Chapter 20 - Division of Taxation
Subchapter 20 - TAX CREDITS/DEDUCTIONS
Part 6 - Historic Preservation Tax Credits 2013 (280-RICR-20-20-6)
Section 280-RICR-20-20-6.7 - Tax Credit

A. Subject to the maximum credit provisions set forth in §§ 6.7(C) and (D) of this Part below, any Person, firm, partnership, trust, estate, LLC, corporation (whether for profit or nonprofit) or other business entity that incurs QREs for the Substantial Rehabilitation of a Certified Historic Structure certified in accordance with these regulations, provided the Rehabilitation is consistent with the Standards of Rehabilitation as certified by the Commission and said Person, firm, partnership, trust, estate, LLC, corporation or other business entity is not a Social Club or Exempt from Real Property Tax, is entitled to a credit against the tax imposed on such Person pursuant to R.I. Gen. Laws Chapters 44-11, 44-13, (other than the tax imposed under R.I. Gen. Laws § 44-13-13), 44-14, 44-17 or 44-30 in an amount equal to the following:

B. Maximum project credit. The credit allowed pursuant to R.I. Gen. Laws Chapter 44-33.6 shall not exceed five million dollars ($5,000,000) for any Certified Rehabilitation project under this program. No building to be completed in phases or in multiple projects shall exceed the maximum project credit of five million dollars ($5,000,000) for all phases or projects involved in the Rehabilitation of such building.

C. Maximum aggregate credits. The aggregate credits Authorized to be Reserved pursuant to R.I. Gen. Laws Chapter 44-33.6 shall not exceed sums estimated to be available in the historic preservation tax credit fund as determined by the Division of Taxation.

D. Subject to the exception provided in § 6.7(H) of this Part, if the amount of the tax credit exceeds the taxpayer's total tax liability for the year in which the substantially rehabilitated property is Placed-in-Service, the amount that exceeds the taxpayer's tax liability may be carried forward for credit against the taxes imposed for the succeeding ten (10) years, or until the full credit is used, whichever occurs first. Credits allowed to a partnership, an LLC taxed as a partnership or multiple Owners of property shall be passed through to the Persons designated as partners, members or Owners respectively pro rata or pursuant to an executed agreement among such Persons designated as partners, members or Owners documenting an alternate distribution method without regard to their sharing of other tax or economic attributes of such entity. Credits may be allocated to partners, members or Owners that are exempt from taxation under Internal Revenue Code, 26 U.S.C. §§ 501(c)(3), 501(c)(4) or 501(c)(6) and these partners, members or Owners must be treated as taxpayers for purposes of these rules and regulations.

E. If the taxpayer has not claimed the tax credits in whole or part, taxpayers eligible for the tax credits may assign, transfer or convey the credits, in whole or in part, by sale or otherwise to any individual or entity, including, but not limited to, condominium Owners in the event the Certified Historic Structure is converted into condominiums and Assignees of the credits that have not claimed the tax credits in whole or part may assign, transfer or convey the credits, in whole or in part, by sale or otherwise to any individual or entity. The Assignee of the tax credits may use acquired credits to offset up to one hundred percent (100%) of the tax liabilities otherwise imposed pursuant to R.I. Gen. Laws Chapters 44-11, 44-13, (other than the tax imposed under R.I. Gen. Laws § 44-13-13), 44-14, 44-17 or 44-30. The Assignee may apply the tax credit against taxes imposed on the Assignee until the end of the tenth calendar year after the year in which the substantially rehabilitated property is Placed-in-Service or until the full credit assigned is used, whichever occurs first. Fiscal year Assignees may claim the credit until the expiration of the fiscal year that ends within the tenth year after the year in which the substantially rehabilitated property is Placed-in-Service. The Assignor shall perfect the transfer by notifying the state of Rhode Island Division of Taxation, in writing, within thirty (30) calendar days following the effective date of the transfer and shall provide any information as may be required by the Division of Taxation to administer and carryout the provisions of R.I. Gen. Laws Chapter 44-33.6.

F. For purposes of R.I. Gen. Laws Chapter 44-33.6, any assignment or sales proceeds received by the taxpayer for its assignment or sale of the tax credits allowed pursuant to R.I. Gen. Laws Chapter 44-33.6 shall be exempt from tax under R.I. Gen. Laws Title 44. If a tax credit is subsequently recaptured under R.I. Gen. Laws Chapter 44-33.6, revoked or adjusted, the seller's tax calculation for the year of revocation, recapture, or adjustment shall be increased by the total amount of the sales proceeds, without proration, as a modification under R.I. Gen. Laws Chapter 44-30. In the event that the seller is not a natural person, the seller's tax calculation under R.I. Gen. Laws Chapters 44-11, 44-13 (other than with respect to the tax imposed under R.I. Gen. Laws § 44-13-13), 44-14, or 44-17, as applicable, for the year of revocation, recapture, or adjustment, shall be increased by including the total amount of the sales proceeds without proration.

G. Credits allowed to partners, members or Owners that are exempt from taxation under Internal Revenue Code, 26 U.S.C. §§ 501(c)(3), 501(c)(4) or 501(c)(6), and only said credits, shall be refundable. Said entities shall file Rhode Island Form HTC-14, Refund Request with the Division of Taxation, together with a copy of a valid determination letter from the Internal Revenue Service certifying their exempt status, and will be entitled to payment equal to 100% of the credit.

H. Substantial Rehabilitation of the following properties is ineligible for the tax credits authorized under R.I. Gen. Laws Chapter 44-33.6:

I. In the case of a corporation, this credit is only allowed against the tax of a corporation included in a consolidated return that qualifies for the credit and not against the tax of other corporations that may join in the filing of a consolidated tax return.

J. The Initial Certificate Holder or the Assignee of such person may also claim the credit in accordance with these rules and regulations.