• Illinois Residential Property Tax Assessment Freeze Program
• Historic Preservation Tax Credits (income-producing properties)
• Hinsdale properties participating in program

• Illinois Residential Property Tax Assessment Freeze Program


The Illinois Historic Preservation Agency (IHPA) administers the Illinois Property Tax Assessment Freeze Program that provides a tax incentive to owner-occupants of designated local landmarks or properties listed on the National Register of Historic Places who rehabilitate their homes. The Property Tax Assessment Program freezes the assessed valuation of the historic property for eight years at its level the year rehabilitation began. The valuation then is brought back to the market level over a period of four years.

Those interested in participating in the program should contact the Illinois Historic Preservation Agency as soon as possible to discuss the program, proposed improvements to the historic building and to obtain the necessary application. The Village of Hinsdale does not administer this program and only provides documentation to the State that the structure is locally landmarked. The Property Tax Assessment Freeze Program benefits both the owner-occupant and the community by:


• Encouraging landmark protection through the promotion, recognition, and designation of historic structures;
• Increasing the value of the rehabilitated property;
• Upgrading neighborhoods and housing within a community.
To qualify for the Property Tax Assessment Freeze through the Illinois Historic Preservation Agency, a property must:
• Be a registered historic structure, either by listing on the National Register of Historic Places, or designated by an approved local historic preservation ordinance;
• Be used as a single-family, owner-occupied residence or condominium, or as a cooperative, or as an owner-occupied residential building with up to six units;
• Go through the Certification Procedure with the Illinois Historic Preservation Agency;
• Be rehabilitated in accordance with the Secretary of the Interior's "Standards for Rehabilitation;
· Typically, the project should take no longer than 24 months, and you must apply within two years of completion. The Director of the Illinois Historic Preservation Agency can give an extension when individual cases warrant more time (i.e. the scope of the project, finances, and family emergencies). To request a longer rehabilitation period, you will need to notify the Director and provide an explanation for the longer rehabilitation period; · Projects that have already started or have been completed may be approved. Again, pre-approval of your project is not a requirement, but it is strongly recommended, in order to avoid complications that may occur; · Have at least 25 percent of the property's fair cash value/market value (contact your township assessor's office to determine what this figure is-it is not the appraised value or purchase price) spent on the approved rehabilitation project; · The property owner's time spent on the project can be included as an allowable expense. Hours must be documented by using the IHPA "Volunteer Service Time Report" form. The allowable hourly rate is the federal minimum wage rate. If you are a professional, you can charge your professional wage rate (example: you are, by trade, a plumber and did all the plumbing rather than contracting it out). A letter certifying your hourly rate must accompany the form, which is available upon request;
• Be a substantial rehabilitation that significantly improves the condition of the historic building - qualified rehabilitation expenditures include any cost incurred by the property owner in renovation, restoration, or reconstruction of the historic building. Examples of allowable costs include, but are not limited to, roof replacement, repointing, painting, wood refinishing, electrical and mechanical systems upgrades, kitchen and bathroom improvements. Architectural fees are also allowable. Things such as new construction outside the existing structure, enlargement, and landscaping costs are ineligible. Other ineligible costs are patios, decks, new additions, driveways, and landscaping;
• Each year, the assessment officer will send an affidavit to the owner that must be completed and returned that verifies you are the owner-occupant of the house. Failure to return the affidavit will lead to the revocation from the program;
• The freeze is not transferable to a new owner if the property is sold during the eight-year freeze time; and
• Again, remember you and your architect should contact the Illinois Historic Preservation Agency as soon as possible to discuss your project.

• Historic Preservation Tax Credits (income-producing properties)


The Federal Historic Preservation Tax Credit Program provides federal income-tax incentives for the rehabilitation of historic income-producing properties. The Illinois Historic Preservation Agency, Preservation Services division, administers the tax credit program for Illinois properties.

Under the provisions of the Tax Reform Act of 1986, a 20% tax credit is available for the substantial rehabilitation of commercial, agricultural, industrial, or rental residential buildings that are certified as historic. The credit may be subtracted directly from federal income taxes owed by the owner. (Note: The U.S. Internal Revenue Service is the final judge of economic matters relative to certified rehabilitations. Therefore, it is advisable that you consult with a tax accountant or lawyer before completing your tax return.)

The Historic Preservation Tax Credit Program benefits the owner, the occupants, and the community by:


• Encouraging protection of landmarks through the promotion, recognition, and designation of historic structures
• Increasing the value of the rehabilitated property and returning underutilized structures to the tax rolls
• Upgrading downtowns and neighborhoods and often increasing the amount of available housing within the community.



To quality for the Investment Tax Credit, a property owner must:


• Have a certified historic structure. To be certified, the building must be listed individually on the National Register of Historic Places or be a contributing part of a historic district that is either listed on the National Register or certified as eligible for the National Register
• Use the building for an income-producing purpose such as rental-residential, commercial, agricultural, or industrial
• Rehabilitate the building in accordance with the Secretary of the Interior's "Standards for Rehabilitation" and "Guidelines for Rehabilitating Historic Buildings." The National Park Service (NPS), with advice from the Illinois Historic Preservation Agency, determines whether a project meets the standards.
• Spend an amount greater than the building's adjusted basis (roughly the current depreciated value of the building not including land value) on the approved rehabilitation project
• Complete the work in a timely manner. Projects must meet the minimum expenditure test within a two-year measuring period, but applicants may take up to five years to complete a phased project if the plans and specs are approved in advance of construction.
• Pay a fee to the NPS; the fee shall be no less than $250 and no greater than $2,500 and shall be based upon the qualifying rehabilitation expenditures.

• Hinsdale Properties Currently Participating in the Tax Assessment Freeze Program
• 122 South Adams Street
• 134 South Park Avenue
• 27 Blaine
• 741 South Garfield Street
• 202 East Fourth Street
• 304 South Lincoln Street
• 329 East Sixth Street
  

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