{"id":134,"date":"2013-12-31T10:13:43","date_gmt":"2013-12-31T14:13:43","guid":{"rendered":"http:\/\/blogs.duanemorris.com\/newmarketslaw\/?p=134"},"modified":"2014-08-27T16:42:52","modified_gmt":"2014-08-27T20:42:52","slug":"irs-publishes-safe-harbor-for-historic-tax-credit-investors","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/2013\/12\/31\/irs-publishes-safe-harbor-for-historic-tax-credit-investors\/","title":{"rendered":"IRS Publishes Safe Harbor for Historic Tax Credit Investors"},"content":{"rendered":"

In an effort to stabilize the Federal Historic Tax Credit industry in the aftermath of the Third Circuit Decision in Historic Boardwalk Hall LLC<\/span> , the Internal Revenue Service (the \u201cIRS\u201d) published Revenue Procedure 2014-12 (the \u201cHTC Rev Proc\u201d) which outlines a safe harbor for investors (an \u201cInvestor\u201d) in Federal Historic Tax Credits (the \u201cTax Credit\u201d). An Investor receives the Tax Credit through an ownership interest in a partnership which owns and develops a historic building or through the election of the partnership to pass the Tax Credit to a master tenant owned by the Investor.In a nutshell the HTC Rev Proc requires: (1) the Investor to have at least a 5% interest in all interests in the partnership; (2) the Investor\u2019s interest in the partnership must represent reasonably anticipated value exclusive of tax benefits; (3) the Investor cannot be protected from losses from partnership activity and must participate in profits in a manner not limited to a preferred return; (4) the ability of the master tenant owned by the Investor to lease the building back to the developer is severely limited; (5) the Investor must contribute at least 20% of the total anticipated capital on or prior to the building being placed in service and this capital contribution must be protected against loss; (6) at least 75% of the Investor\u2019s total anticipated capital must be fixed before the building is placed in service; (7) guarantees to the Investor will be limited to a guaranty with respect to any act or omission which would prevent the partnership from qualifying for the Tax Credit; and (8) the developer may not have the right to acquire the Investor\u2019s interest in the Partnership and the Investor may have a right to compel the developer to purchase the Investor\u2019s interest at its fair market value. The Rev Proc echoes the position of the IRS in a 2007 Revenue Procedure which provided a safe harbor with respect to investors in the wind production tax credit as well as the Historic Board Hall case.<\/p>\n","protected":false},"excerpt":{"rendered":"

In an effort to stabilize the Federal Historic Tax Credit industry in the aftermath of the Third Circuit Decision in Historic Boardwalk Hall LLC , the Internal Revenue Service (the \u201cIRS\u201d) published Revenue Procedure 2014-12 (the \u201cHTC Rev Proc\u201d) which outlines a safe harbor for investors (an \u201cInvestor\u201d) in Federal Historic Tax Credits (the \u201cTax … <\/p>\n

Continue reading “IRS Publishes Safe Harbor for Historic Tax Credit Investors”<\/span><\/a><\/p>\n","protected":false},"author":168,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[18,17,12],"ppma_author":[89],"class_list":["post-134","post","type-post","status-publish","format-standard","hentry","category-historic-tax-credit-program","tag-historic-boardwalk-case","tag-historic-tax-credits","tag-momjian"],"authors":[{"term_id":89,"user_id":168,"is_guest":0,"slug":"ajmomjian","display_name":"Arthur J. Momjian","avatar_url":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-content\/uploads\/sites\/9\/2014\/07\/momjianart-125x150.jpg","author_category":"","last_name":"Momjian","first_name":"Arthur J.","job_title":"","user_url":"http:\/\/www.duanemorris.com\/attorneys\/arthurjmomjian.html","description":"Read Art's bio.<\/a>"}],"_links":{"self":[{"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/posts\/134","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/users\/168"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/comments?post=134"}],"version-history":[{"count":0,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/posts\/134\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/media?parent=134"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/categories?post=134"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/tags?post=134"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/newmarketslaw\/wp-json\/wp\/v2\/ppma_author?post=134"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}