The IRS has clarified its position on the treatment of 50(d) income in lease pass-through structured historic rehabilitation projects through publication of Treas. Reg. 1.50-1T. These temporary regulations are effective for projects placed in service on or after September 19, 2016 and remain in effect until July 19, 2019.
By determining that the 50(d) income associated with the pass-through of the rehabilitation tax credit is a partner item (rather than a partnership item), the temporary regulations will impact on the future structure of investments in historic rehabilitation projects, likely resulting in smaller investments being made available for preservation of historic buildings and neighborhoods.
Treas. Reg. 1.50-1T
Tim Lynn
(315) 766-2118
tim@centolellalaw.com
