Turn your historic building’s facade into a tax break | Mt Kisco Real Estate

If you happen to own a historic building, you could be sitting on a tax deduction gold mine. If you meet various strict IRS requirements, you may be able to donate a facade easement to a charity and reap a substantial charitable tax deduction.

However, you need to be careful. Due to past abuses by some property owners, the IRS tends to be very suspicious of facade easement deductions.

A facade easement is a legally binding agreement that the owner of a historic structure enters into with a charity whose mission includes historic preservation. The owner gives up the right to demolish or make other destructive alternations to the exterior of the building.

The easement, which must run with the title to the property forever, gives the nonprofit the right to review and preapprove any changes to the building exterior.

All other rights and obligations of ownership, such as the right to sell or lease the property, and the duty to maintain it, remain with the owner. The owner may also make any changes he or she desires to the building interior.

Why would a homeowner want to grant a facade easement? Two reasons: (1) it ensures that the historic character of the exterior of their structure will be preserved; and (2) it may result in a tax deduction — a deduction that could be substantial.

– See more at: http://www.inman.com/2013/07/19/turn-your-historic-buildings-facade-into-a-tax-break/#sthash.5jyTvXoj.dpuf

 

 

Turn your historic building’s facade into a tax break | Inman News.