Mueller Prost specializes and has been recognized for its efforts by the Department of Housing and Urban Development (HUD), Missouri Department of Economic Development and Missouri Housing Development Commission (MHDC) for its understanding of the issues and compliance with the requirements of the audits of cost certifications. We receive extensive and in-depth training to enable our teams to be able to give the most effective and excellent personalized service for our clients.
- Historic Tax Preservation
The Missouri State Historic Tax Credit is available for commercial and residential use. This includes the rehabilitation of a historic property. The tax credit is equal to 25% of the cost of renovation. The tax may be used to offset State taxes and a qualifying federal credit may also be applicable. The Missouri Department of Economic Development monitors this program.
The historic property must be listed on the National Register of Historic Places, be considered a contributing structure in a National Register historic district or in a local historic district certified by the United States Department of the Interior.
- Low Income Housing Tax Credits
The Low Income Housing Tax Credit (LIHTC) Program is a federal program designed to bring private investors into the affordable rental housing or low-income residential housing market. Normally, a developer will generate equity in a project by selling or syndicating credits to investors, who are able to utilize the federal and state credits. The amount of credits available is based on the cost of the development and the percentage of qualified low-income units that are credited within the project. The low-income units are restricted for fifteen years for low-income affordable housing.
Missouri Housing Development Commission (MHDC) has primary responsibility for this program in Missouri. Based upon their requirements, cost certifications and ongoing financial reporting is required to be submitted to MHDC for LIHTC projects.
Other Opportunities for Real Estate Owners
- Cost Segregation Studies
If you are constructing a new building, expanding a current facility, or purchasing/rehabbing an old facility, you may be able to generate significant tax savings. Real property, land improvements, and personal property are depreciated differently. Cost segregation is the process of analyzing and identifying commercial building costs, components, drawings, and documents that are eligible for accelerated depreciation, providing a significant tax benefit. This can result in acceleration of tax depreciation expense, lower taxable income, and increased cash flow. Learn more here
- 1031 Exchanges
Section 1031 allows a business / investment property owner to sell any “like-kind” property and buy another “like-kind” property within 180 calendar days following the closing of the relinquished property. “Like-kind” property includes, but is not limited to, single family rentals, duplexes, apartments, commercial properties, and raw land. The owner can defer paying capital gains taxes in this scenario. Section 1031 allows owners to use all of the sale proceeds to leverage more valuable real estate, increase cash flow, reduce management, or consolidate holdings.
- Energy Efficiency Tax Incentives
For more details about these Federal and State Tax Credits, or about our specialists' expertise, please contact Teri Samples, CPA or Doug Mueller, CPA.