Five Ohio companies that purchased historic buildings and planned to rehabilitate them in anticipation of refundable state tax credits are asking the Ohio Supreme Court to force the Ohio Department of Development (ODOD) to approve their applications.

The General Assembly enacted the Historic Preservation Tax Credit Program to spur economic development and rehabilitation of historic structures. The program provides a tax credit equal to 25 percent of qualified expenses incurred in rehabilitation against a building owner's state corporate franchise, personal income, or dealer-in-intangible tax liability when the rehabilitation work is complete.

According to one of the plaintiffs,  Middle Earth, the program stated tax credits were available for the first 100 eligible projects that applied and that the company and four other building owners listed in the complaint were among the first one hundred. ODOD announced on March 13, 2008  that no more applications would be accepted even though the department approved only 37 applications because the credit amount exceeded the two-year budget for the program.

Joining Middle Earth in the complaint were owners of the American Can Building, the Andrew Jackson House, the Dayton Power and Light Building, and the C.F. Ware Coffee Co. Building.

The Historical Preservation Tax Credit Program is slated for expansion under a bipartisan, $1.57 billion economic stimulus package announced in April 2008.

For additional information on the Ohio Historical Preservation Tax credit, please contact Theresa Mullen, State & Local Tax Leader at 330.497.2000.