HTCC Works With the IRS to Issue HTC Revenue Procedure
January 8, 2015In August 2013, the Third Circuit Court of Appeals released a decision that halted historic preservation projects around the country. In Historic Boardwalk Hall LLC v. Commissioner, the Third Circuit held that an institutional investor in a partnership engaged in the rehabilitation of Historic Boardwalk Hall was not a “bona fide partner.” Given the unusual facts and structure of the transaction, the HTCC understood and agreed with the Third Circuit’s decision. But the Court did not provide clear guidance on what it would take to be respected as a partner in an HTC transaction. Due to the lack of clarity on how to assure partnership status, investors withdrew from the market.
To help re-energize the historic tax credit industry, the Historic Tax Credit Coalition (HTCC) began to work with the Internal Revenue Service (IRS) on a comprehensive revenue procedure that would give investors and developers a clear roadmap for compliance. Beginning in April 2013, the HTCC, the IRS and Treasury held a series of meetings and conference calls aimed at drafting the revenue procedure. These discussions led to the HTCC’s submission of written guidance suggestions that helped government officials better understand how HTC transactions are done in the market place and what guidance provisions would help restore investor confidence.
As a result of the HTCC’s efforts in Congress and the Administration, the IRS released Revenue Procedure 2014-12 on December 30, 2013 and revised it on January 8, 2014. While the HTCC was originally told that the process of receiving IRS guidance would take 18 months, the industry received guidance in less than 9 months.
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HTCC Works With the IRS to Issue HTC Revenue Procedure
January 8, 2015In August 2013, the Third Circuit Court of Appeals released a decision that halted historic preservation projects around the country. In Historic Boardwalk Hall LLC v. Commissioner, the Third Circuit held that an institutional investor in a partnership engaged in the rehabilitation of Historic Boardwalk Hall was not a “bona fide partner.” Given the unusual facts and structure of the transaction, the HTCC understood and agreed with the Third Circuit’s decision. But the Court did not provide clear guidance on what it would take to be respected as a partner in an HTC transaction. Due to the lack of clarity on how to assure partnership status, investors withdrew from the market.
To help re-energize the historic tax credit industry, the Historic Tax Credit Coalition (HTCC) began to work with the Internal Revenue Service (IRS) on a comprehensive revenue procedure that would give investors and developers a clear roadmap for compliance. Beginning in April 2013, the HTCC, the IRS and Treasury held a series of meetings and conference calls aimed at drafting the revenue procedure. These discussions led to the HTCC’s submission of written guidance suggestions that helped government officials better understand how HTC transactions are done in the market place and what guidance provisions would help restore investor confidence.
As a result of the HTCC’s efforts in Congress and the Administration, the IRS released Revenue Procedure 2014-12 on December 30, 2013 and revised it on January 8, 2014. While the HTCC was originally told that the process of receiving IRS guidance would take 18 months, the industry received guidance in less than 9 months.
Downloads
Category: IRS Guidance