Contact UsDid the IRS recently issue new administrative guidance in connection to safe harbors for monetizing preservation tax incentives (e.g., historic tax credits and rehabilitation tax credits)?
Tax Professional Answers
Yes, the Internal Revenue Service (hereinafter the "Service") recently
issued new administrative guidance in the form of Revenue Procedure 2014-12,
2014-3 IRB (hereinafter Rev. Proc. 2014-12) which establishes a safe harbor for
structuring the allocations of tax credits generated by partnerships that
rehabilitate certified historic structures and other qualified buildings.
It should be duly noted that compliance with the safe harbor ensures that the
Service will not challenge a partnership's allocations of these aforementioned
tax credits. While Rev. Proc. 2014-12 applies only to credits claimed under
I.R.C. § 47 for the rehabilitation of certified historic structures and other qualified buildings, the guidance could potentially have an impact on how investors and principals allocate other federal tax credits on a carryforward basis.
Please feel free to contact me directly to discuss your client's facts and circumstances in order to properly address the sustainability of your client's tax return filing position per Circular 230 in connection to this matter.
Rev. Proc. 2014-12 can be downloaded from the subsequent link:
www.irs.gov/pub/irs-drop/rp-14-12.pdf">www.irs.gov/pub/irs-drop/rp-14-12.pdf