West VirginiaSB 3892026 Regular SessionSenateWALLET

Historic Rehab Building Credit Act

Sponsored By: Randy E. Smith (Republican)

Failed

§11-13NN-1§11-13NN-2§11-13NN-3§11-13NN-4§11-13NN-5§11-13NN-6§11-13NN-7§11-13NN-8§11-13NN-9§11-13NN-10§11-13NN-11§11-13NN-12§11-13NN-13§11-13NN-14§11-21-8I§11-24-23H

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Bill Overview

Analyzed Economic Effects

6 provisions identified: 1 benefits, 3 costs, 2 mixed.

Historic credit applicants face caps and fees

Starting with tax year 2026, each taxpayer can claim no more than $100,000 a year in historic rehabilitation credits. A $5 million limit applies to any one taxpayer or certified historic building. Statewide claims are capped at $10 million in calendar year 2026 and $20 million each calendar year after. Each credit application carries a fee of 0.5% of requested credits, capped at $10,000, payable to the State Historic Preservation Officer. Taxpayers cannot also claim the credit under §11-24-23a for the same expenses.

Owners face repayment after property changes

Selling, transferring, or otherwise disposing of the property can require repayment of the historic rehabilitation credit. Failing rehabilitation standards or required conditions also triggers repayment. Repayment is 100% within one year after the credit certificate, and 80% after one but no more than two years. It is 60% after two but no more than three years, and 40% after three but no more than four years. It is 20% after four but no more than five years; events after five years do not trigger this repayment.

Historic building tax savings carry conditions

Beginning with tax year 2026, owners of certified historic buildings in West Virginia get a 25% credit against personal or corporate income tax. Projects must meet historic rehabilitation standards, and owners must show a federal historic credit was potentially earned for the same work, even if unclaimed. Applicants must stay current on state, local, municipal, and property taxes throughout the claim period. Residential applicants must live in the home as their main residence for at least five years after certification; the home cannot produce income or qualify for depreciation. Residential buildings must be individually listed on the National Register of Historic Places or contribute to a listed historic district. Required historic certifications must be received before claiming the credit, subject to the separate rules for approved phases. Costs incurred after December 31, 2035, do not qualify.

Owners gain ways to use historic credits

Taxpayers can request a refund when their historic rehabilitation credit exceeds their state tax bill; available carryover is applied first. Unused credits can carry forward for up to five consecutive tax years, but amounts remaining after that period are lost. Joint owners can each claim a share based on their ownership interest. Taxpayers can transfer all or part of the credit to another taxpayer. A credit can be transferred only once, so the recipient cannot transfer it again.

Owners can claim credits by project phase

Owners with approved phased historic rehabilitation projects can claim credits after completing and separately certifying each phase. They do not have to wait for the whole project to finish. Each completed phase requires a Part 3 application to certify completed work. Phase claims remain subject to final project certification.

Historic credit fraud brings criminal penalties

Knowingly filing a false or fraudulent historic credit application is a felony. A conviction can bring a fine up to $10,000, prison time up to two years, or both. Anyone who knowingly misuses credit proceeds must repay them with interest at the Tax Commissioner's underpayment rate. Interest accrues monthly from the date the proceeds were received. These penalties target knowing fraud or misuse, not innocent errors.

Sponsors & Cosponsors

Sponsor

Randy E. Smith
Republican • Senate

Cosponsors

Mike Woelfel
Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 245 • No: 1

House vote • 3/13/2026

Effective July 1, 2026 (Roll No. 524)

Yes: 89 • No: 1

House vote • 3/13/2026

Passed House (Roll No. 523)

Yes: 92 • No: 0

Senate vote • 2/13/2026

Effective July 1, 2026 (Roll No. 73)

Yes: 32 • No: 0