Here’s What Historic Building Owners Should Know About the Rehabilitation Tax Credit

Organizations around the country continue to promote historic buildings and other important heritage sites. The rehabilitation tax credit offers an incentive to renovate and restore old or historic buildings. Here are some important points about this credit:

● The credit is 20 percent of the taxpayer’s qualifying costs for rehabilitating a building.

● The credit doesn’t apply to the money spent on buying the structure.

● The legislation now requires taxpayers take the 20 percent credit spread out over five years beginning in the year they placed the building into service.

● The law eliminates the 10 percent rehabilitation credit for pre-1936 buildings, but a transition rule allows owners of either a certified historic structure or a pre-1936 building to use the prior law if the project meets certain conditions.

● Taxpayers use Form 3468, Investment Credit, to claim the rehabilitation tax credit and a variety of other investment credits. Form 3468 instructions have detailed requirements for completing the form.

Faxing of Tax Transcripts Ends June 28

Starting June 28, 2019, the IRS will stop faxing tax transcripts to both taxpayers and third parties, including tax professionals. This action affects individual and business transcripts.

Tax transcripts are summaries of tax return information. Transcripts have become increasingly vulnerable as criminals impersonate taxpayers or authorized third parties. Identity thieves use tax transcripts to file fraudulent returns for refunds that are difficult to detect because they mirror a legitimate tax return.

Individual taxpayers have several options to obtain a tax transcript. They may: ● Use IRS.gov or the IRS2Go app to access "Get Transcript Online" (after verifying their identities, taxpayers may immediately download or print their transcript) or "Get Transcript by Mail" (transcript will be delivered within 10 days to the address of record) ● Call 800-908-9946 for an automated Get Transcript by Mail feature ● Submit Form 4506-T or 4506T-EZ to have a transcript mailed to the address of record. (On July 1, 2019 the forms will be amended to remove the option for mailing to a third-party)

“Distraint Warrant” Scam

Scammers are sending threatening tax letters all over the country to prey on unsuspecting individuals. The letter claims to be a “Distraint Warrant” for back taxes. It is an official-looking letter that appears to be sent from the county government office where the addressee resides.

The warrant doesn’t threaten arrest. Rather, it claims the distraint warrant serves the same function as a court settlement and demands immediate payment of tens of thousands of dollars. The letter threatens garnishment of wages and bank accounts, property seizure, federal tax refund offset, and the creation of a property lien unless the addressee calls the phone number on the letter to pay the alleged back taxes.

Sheriffs’ offices across the country are reassuring residents that the letter is fake and that anyone receiving a letter like this should report it to their local law enforcement agency.