Missouri law provides an investment tax credit equal to 25 percent of approved costs associated with qualified rehabilitation made after Jan. 1, 1998. Homeowners as well as commercial developers can qualify for the state credit. The state credits are administered by the Community Development Division in the Missouri Department of Economic Development. The State Historic Preservation Office is responsible for reviewing and approving rehabilitation work for the state credits.
The federal and state credits can be used in combination for the rehabilitation of commercial or income-producing properties. Rehabilitation of non-income producing residential properties qualifies for the state credits only.
A tax credit lowers the tax owed. A tax credit differs from a tax deduction in that income tax deduction lowers the amount of income subject to taxation while a dollar of tax credits reduces the income tax owed by one dollar.
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