Form 502H - Maryland Tax Forms and Instructions

MARYLAND
FORM
502H
HERITAGE STRUCTURE REHABILITATION TAX CREDIT
For tax years beginning on or after January 1, 2002
Taxpayer identification number
Name of taxpayer(s)
◆
◆
2002
YOUR MARYLAND RESTORATION AND QUALIFIED COSTS MUST BE CERTIFIED BY THE MARYLAND HISTORICAL TRUST (MHT)
Attach a copy of your approved Heritage Preservation Certification Application (Part 3) and Form 502H to your tax return.
REMINDER: All photographs are to be sent to the Maryland Historical Trust at:
100 Community Place
Crownsville, Maryland 21032-2023
For further information or to obtain applications, contact the Maryland Historical Trust at 410-514-7630 or www.marylandhistoricaltrust.net
Do not send photographs to the Revenue Administration Division.
SECTION 1 - Complete this
section only if the certified
rehabilitation was completed
during tax year 2002.
DESCRIPTION AND LOCATION OF PROPERTY
(1)
CERTIFIED
REHABILITATION
EXPENDITURES
(2)
RATE
MULTIPLY THE
EXPENDITURES IN
COL. 2 BY THE RATE
IN COL. 3
(3)
ENTER THE AMOUNTS FROM
COLUMN 4 FOR EACH PROPERTY
$3,000,000 MAXIMUM PER
PROPERTY FOR PARTS B & C
(5)
(4)
Part A: FOR AN APPLICATION TO
REHABILITATE A COMMERCIAL
STRUCTURE SUBMITTED TO THE MHT
25%
DURING THE PERIOD JANUARY 1, 2002,
THROUGH FEBRUARY 1, 2002
Part B: FOR THE REHABILITATION OF
NON-COMMERCIAL STRUCTURES
20%
Part C: FOR AN APPLICATION TO
REHABILITATE A COMMERCIAL
STRUCTURE SUBMITTED TO THE MHT
20%
AFTER FEBRUARY 1, 2002
SECTION 2
Current Year Credit/Recapture:
1. Enter the total from Column 5, Parts A, B and C, less any recaptures if applicable (see instructions), here and on:
line 2, Part J of Form 502CR (if filing Form 502 or Form 505); OR
line 39, of Form 504 (if filing Form 504); OR
line 10d, of Form 500 (if filing Form 500).
If negative, enter the negative amount on the appropriate form.
1.
Carryovers from Prior Years (see instructions):
2. Enter any Heritage Structure Rehabilitation Tax Credit carried over from prior years.
2.
3. Enter the State tax from:
line 24 of Form 502 (less amounts from lines 25 and 26 of Form 502 and lines 1 through 7, Part H of Form 502CR); OR
line 32 of Form 505 (less amounts from lines 33 and 34 of Form 505 and lines 1 through 7, Part H of Form 502CR).
3.
4. Non-refundable Heritage Structure Rehabilitation Tax Credit. Enter the lesser of line 2 or line 3. Also enter this amount on
line 8, Part H of Form 502CR.
4.
5. Heritage Structure Rehabilitation Tax Credit carryover. Subtract line 4 from line 2. If less than 0, enter 0.
If it is greater than 0, it may be carried forward for up to 10 successive tax years from the year in which the
rehabilitation was completed or until fully used, whichever is earlier.
COM/RAD-015
Rev. 9/02
5.
INSTRUCTIONS
FOR
FORM 502H
2002
HERITAGE STRUCTURE
REHABILITATION TAX CREDIT
General Instructions
Purpose of Form
Form 502H is used to calculate allowable tax credits for the rehabilitation of certified heritage structures completed in tax years
which begin during the period of January 1, 2002 through
December 31, 2002. This form is also used to determine the
amount of any prior year Heritage Structure Rehabilitation Tax
Credit (formerly known as Heritage Area Tax Credit) which may be
used this tax year and any remaining credit to carry over to future
tax years.
Certified Expenditures
Substantial rehabilitation expenditures incurred over a 24-month
period must be certified by the Maryland Historical Trust (MHT).
Substantial expenditures are those exceeding $5,000 for owneroccupied residential property or the greater of the adjusted basis
of the structure or $5,000 for all other property.
The same expenditures may not be used to qualify for a credit in
any other tax year or in more than one Part of Section 1.
Certification from the MHT must be obtained before the credit can
be claimed. An amended return may be required if the original
return is filed before the certification is received.
Allowable Credit
A credit against state income tax for a percentage of the amount
spent to rehabilitate a certified heritage structure is provided for all
tax years beginning after December 31, 1996. Credit for a rehabilitation certified after June 30, 2001 may be refunded if the credit exceeds the State tax liability and the structure is located in
Maryland.
Specific Instructions
Section 1
Part A – Use Part A only if the rehabilitation involves a certified
commercial heritage structure and the Heritage Preservation
Certification Application was submitted to the MHT on or after
January 1, 2002, but on or before February 1, 2002.
Part B – Use Part B only if the rehabilitation involves a certified
non-commercial heritage structure and the rehabilitation was
completed after December 31, 2001.
Part C – Use Part C only if the rehabilitation involves a certified
commercial heritage structure and the Heritage Preservation
Certification Application was submitted to the MHT after February
1, 2002.
Note: If there is more than one property for which a credit is being
claimed in any Part (A, B or C), attach a schedule that includes
the same information provided in Section 1 of this form for each
property. The total of the amounts in Column 5 for all properties
will be entered on line 1 of Section 2.
Column 1 (Parts A, B and C) – Enter the description and location of each certified heritage structure as shown on the Heritage
Preservation Certification Application (Part 3).
Column 2 (Parts A, B and C) – Enter the amount of certified
expenditures for the property listed in Column 1.
Column 3 (Part A) – The rate is 25%.
Column 3 (Parts B & C) – The rate is 20%.
Column 4 (Parts A, B and C) – Multiply the expenditure shown
in Column 2 by the corresponding percentage in Column 3. Enter
this amount in Column 4.
Column 5 (Part A) – Enter the amount from Column 4.
Column 5 (Parts B and C) – For each property, enter the amount
from Column 4 or $3,000,000, whichever is less.
Section 2
Current Year Credit/Recapture
Line 1 – Enter the total of the amounts in Column 5, Parts A, B
and C less the amount of any recaptures (see below). Also enter
PAGE 2
this amount on the appropriate line of the income tax form being
filed: Line 2, Part J of Form 502CR (Forms 502 or 505); line 39 of
Form 504; or line 10d of Form 500. If negative, enter the negative
amount.
Note: If credit is allowed for multiple properties in any one Part (A,
B or C), the amount entered on line 1 should be the total of
Column 5 for all rehabilitated properties.
Recaptures
If work was performed that would disqualify the certification, issued
on or after July 1, 2001 for a heritage structure for which a credit
was claimed, a portion of the credit must be recaptured. A recapture is required only if the disqualifying work was performed during
the first 5 years (starting with the first year the credit was claimed).
The recapture must be made on the tax return for the tax year in
which the disqualifying work is done. In the first year, 100% of the
credit must be recaptured, 80% in the 2nd, 60% in the 3rd, 40%
in the 4th, and 20% the 5th. No recapture is required for disqualifying work performed after the first 5 years. Line 1 of Section 2
must be reduced by the amount of the recapture; if the result is
negative, enter the negative amount.
Carryovers from Prior Years
This section is only used by individuals who file Forms 502 or 505
and had no carryover from a prior year for the Heritage Structure
Rehabilitation Tax Credit on a Form 500CR (for business tax credits) filed in the prior year.
If Form 500CR was used to take the Heritage Structure
Rehabilitation Tax Credit in a prior year, Form 500CR must be
used to take any credit that remains. Form 500CR provides for the
credit carried over from a prior year.
Line 2 – Enter the amount of any Heritage Structure
Rehabilitation Tax Credit carried over from prior years. This
amount can be found on the Form 502H filed in the prior year.
Line 3 – Enter the State tax from line 24 of Form 502 (less
amounts from lines 25 and 26 of Form 502 and lines 1 through 7
from Part H of Form 502CR) or line 32 of Form 505 (less amounts
from lines 33 and 34 of Form 505 and lines 1 through 7 from Part
H of Form 502CR).
Line 4 – Compare the amounts shown on lines 2 and 3. Enter the
lesser of the two amounts on line 4. Also enter this amount on line
8, Part H of Form 502CR.
Line 5 – Subtract the amount on line 4 from the amount on line 2.
If less than 0, enter 0. If this amount is greater than 0, this is the
new Heritage Structure Rehabilitation Tax Credit carryover. This
amount may be carried forward for up to 10 successive tax years
from the year in which the rehabilitation was completed or until it
is fully used, whichever occurs first.
Attachment of Forms
Attach your completed Form 502H along with a copy of the
approved Heritage Preservation Certification Application (Part 3)
to the income tax return. Failure to do so will result in the credit
being disallowed.
For questions concerning certification, contact:
The Maryland Historical Trust
100 Community Place
Crownsville, Maryland 21032-2023
410-514-7627 or 410-514-7628
or www.marylandhistoricaltrust.net
For questions concerning the credit calculation, contact:
Revenue Administration Division
Annapolis, Maryland 21411-0001
410-260-7980 from central Maryland, or
1-800-MD TAXES from elsewhere