Rhode Island Historic Tax Credits for Real Estate
Tax credits to give incentive to developers & to stimulate the Ocean State's economy
By Emilio DiSpirito, Licensed RI Real Estate Agent, Realtor & Radio Show Host of The Round Table Real Estate Simplified on iHeartradio WHJJ & Newsradio 920
Throughout the country, Historic real estate tax credits have helped shape & rebuild cities & towns with a heavy inventory of mill buildings into revitalized living and shopping communities. Sound familiar?
Few lenders will risk forking over a large sum of cash to developers without Federal & State tax credits. Since the 1980's tax credits on a local state to state basis have become huge components to revitalization. At times when these credits are taken away because of immediate statewide budget constraints, activity comes to a halt, leaving many jobless. As we have seen in 2008 when Carcieri shut down the tax credit for new applicants. This is where things like FIRPTA, the Foreign Investment in Real Property Tax Act may assist!
PROVIDENCE, R.I. – Acting Department of Revenue Director David M. Sullivan reminds taxpayers that a number of Rhode Island tax changes that took effect July 1, 2015.
"The “Rebuild Rhode Island Tax Credit” program is intended to encourage the
development of commercial projects. In general, the maximum tax credit will be 20
percent of a project’s cost, although – under certain circumstances – an applicant can be
eligible for an additional tax credits of up to 10 percent of the project cost. The maximum
credit will be $15 million per project."
So who does this effect? How does this benefit Rhode Islanders and tax payers?
In a recent story by RI Monthy, they quoted a study by Grow Smart Rhode Island when the Rhode Island Real Estate Historic Tax Credit was in place. "In 2007, it counted 277 completed and active projects (mostly rental units and some commercial and mixed-use) with a $1.53 billion portfolio. Each dollar of the $460 million the state invested in the tax credits generated $5.35 in economic output."
HOLD THE PHONE - Each dollar invested by Rhode Island tax payers on revitalizing historic mills and other real estate into residential, rental and mixed use commercial space has raised $5.35!! To emphasize on this more.. $460 Million Returned approximately 2.5 BILLION in economic output (defined below)!
According to SBA.gov, 95.9% of all businesses, approximately 93,333 (2009), make up 55.2% of the private sector workforce. Now you may be asking... why is this relevant? Well because in my family alone we have a plumber, electrician, general contractor, mover, office furniture installer; my neighbor is a heavy equipment operator, my best friend is a carpenter.. Some of these Rhode Island professionals & many laborers will indeed be back to work!
"Economic output is the total value of all goods and services produced in an economy. It is a regular tool used in macroeconomic analysis to determine whether an economy is growing or contracting by comparing output during two different points in time." Thank you www.Study.com
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