Form 3614 - Preservation Tax Credit Assignment (Page 3 of 4) in pdf

INSTRUCTIONS FOR MICHIGAN HISTORIC

PRESERVATION TAX CREDIT ASSIGNMENT (form 3614)

The Michigan Historic Preservation Tax Credit is a nonrefundable

The purpose of this form is to allow single business tax filers to

credit. However, if the credit exceeds the taxpayer’s tax liability,

calculate and assign the Michigan Historic Preservation Tax Credit.

the balance of the credit may be carried forward for up to ten years.

The Michigan Historic Preservation Tax Credit provides tax

incentives to rehabilitate historic resources located in the State of

Note: If the resource is sold or the certification of completed

Michigan.

rehabilitation is revoked less than five years after the credit is

claimed, a percentage of the credit will be subject to recapture. If

The single business tax assignor must complete the Michigan

the credit has been assigned, the recapture is the responsibility

Historic Preservation Tax Credit Assignment (form 3614) after the

of the assignee.

date the State Historic Preservation Office (SHPO) issues the

certificate of completed rehabilitation and before any assignee files

Eligibility

a tax return to claim the credit. The date the SHPO issued the

certificate of completed rehabilitation is found on the Historic

The Michigan Historic Preservation Tax Credit is available to

Preservation Certification Application Part 3 – Request for

eligible assignees, owners or long-term lessees of qualified historic

Certification of Completed Work.

resources who undertake rehabilitation projects that are certified

by the State Historic Preservation Office of the Michigan Historical

Assignment of the Credit

Center.

A qualified taxpayer who is a partnership, limited liability company,

Property owners undertaking rehabilitation projects on depreciable

or subchapter S corporation may assign all or a portion of its

properties that qualify for the federal historic preservation tax credit

Michigan Historic Preservation Tax Credit to its partners, members,

must first apply for the federal credit.

or shareholders. The qualified taxpayer must assign its credit

during the tax year in which the completed rehabilitation certificate

Qualified Expenditures

is issued.

Qualified expenditures are capital expenditures that qualify for the

The credit assignment cannot be revoked or reassigned. An

federal rehabilitation credit if the qualified taxpayer is eligible for

assigned credit amount must be claimed against the partner’s,

that credit or capital expenditures that would qualify for the federal

member’s, or shareholder’s SBT liability in the fiscal or calendar

credit except that the expenditures were made for a historic

year which includes the assignor’s tax year-end. An individual must

resource that is not eligible for the federal credit. A qualified

claim the assigned credit amount in the calendar year in which

taxpayer with qualified expenditures eligible for the federal credit

the assignor’s tax year ends.

must claim and receive the federal credit to qualify for the Michigan

credit. The qualified expenditures must be paid after December 31,

The assigned credit must be based on the partner’s, member’s, or

1998 for the rehabilitation of a historic resource but not more than

shareholder’s proportionate share of ownership or an alternative

five years after the certification of the rehabilitation plan.

method approved by the Department of Treasury. The completed

Michigan Historic Preservation Tax Credit Assignment (form 3614)

The amount of the qualified expenditures must be equal to or

and required attachments must be submitted to the Michigan

greater than 10 percent of the State Equalized Value (SEV) of the

Department of Treasury, Return Processing Division, Single

rehabilitated property. If the historic resource to be rehabilitated

Business Tax Unit, prior to the filing of any tax return to claim a

is part of a historic or non-historic resource, only the SEV for that

credit. The Single Business Tax Unit will review the assignment

portion can be used. If the SEV has not been determined for the

form and attachments and return an approved form 3614 to the

historic portion, or if the historic resource to be rehabilitated does

assignor. The assignor must furnish each assignee with a copy of

not have an SEV, the total qualified expenditures must be equal to

the approved form 3614 to attach to their tax return.

or greater than 5 percent of the resource’s appraised value.

A separate form 3614 must be completed for each project.

Line-By-Line Instructions

What is the Michigan Historic

Lines not listed are explained on the form.

Preservation Tax Credit

Part 1: Assignor Identification

The Michigan Historic Preservation Tax Credit is available to

Line 1 - Enter the name and address of the partnership, limited

qualified taxpayers with a rehabilitation plan certified after

liability company, or subchapter S corporation who is assigning

December 31, 1998. The credit must be claimed in the year that

the Michigan Historic Preservation Tax Credit. The assignor must

the certification of completed rehabilitation of the historic resource

be an owner or long-term lessee of a qualified historic resource.

is issued, and within five years of the year the rehabilitation plan

was certified.

Line 3 - Assignor Account Number. Enter the assignor’s account

number.

Qualified taxpayers may receive a Michigan credit equal to 25

percent of the qualified expenditures. For qualified taxpayers

Line 4 - Project Number. Enter the project number assigned by

eligible for the federal credit under Section 47(a)(2) of the Internal

the State Historic Preservation Office.

Revenue Code (IRC), the Michigan credit is 25 percent of the

qualified expenditures less the amount of the federal credit claimed.

Line 5 - Date Project Certified as Complete. Enter the date the

State Historic Preservation Office issued the certification of

Form 3614 - Preservation Tax Credit Assignment Page 3

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