What Texas Form 05-179 (2017) Is For
Texas Form 05-179 is used to notify the Texas Comptroller of Public Accounts when ownership of a historic structure credit changes through a sale, assignment, or allocation of the credit. The form ensures the correct entity is recognized as the credit owner for state tax reporting purposes.
The historic structure credit, also known as the Rehabilitation Credit, is earned after approved rehabilitation work is completed on a certified historic structure. Once the credit is issued, it may be transferred; however, the Texas Comptroller must be notified to maintain accurate tax records.
When You’d Use Texas Form 05-179 (2017)
Texas Form 05-179 must be submitted each time a historic structure credit is sold, transferred to another group, or transferred to a new group. This includes distributions within pass-through entities, such as partnerships, S corporations, or trust companies, as well as transfers between Texas businesses that are not affiliated.
After the transaction date, the form must be submitted within 30 days. The form must be signed by the receiving entity and the transferring entity before it can be sent to the Texas Comptroller.
When the initial credit holder claims the credit on its own Texas Franchise Tax Report without transferring any of the credit, the form is not necessary.
Key Rules or Details for 2017
The Texas Tax Code states that the Texas Comptroller of Public Accounts is responsible for administering the historic structure credit for 2017. The credit is available on Texas Franchise Tax Reports and insurance premium tax reports that meet the program's eligibility and reporting rules.
Only a portion of qualified rehabilitation costs may be used to qualify for the credit. The property may only be used for six consecutive tax years, starting from the year it is put into service. Transfers by sale, assignment, or allocation do not increase the total amount permitted or extend the credit period.
Step-by-Step (High Level)
Step 1: Gather required documents and details
Get a valid Form 05-901 that shows the credit balance, the federal tax ID number for each party, and the Certificate of Eligibility that you got after cost certification. Look at the date of the transaction and the amount of credit being sent.
Step 2: Complete seller and buyer sections
Fill out Section A with the seller's information and Section B with the buyer's information. To ensure that tasks are completed on time, use taxpayer numbers and full legal names.
Step 3: Enter the transferred amount and remaining balance
Clearly indicate how much credit is remaining and how much is being transferred. Verify Form 05-901 to ensure the numbers are accurate.
Step 4: Review and sign the form
After confirming the form's accuracy, both parties sign it if needed. Without the necessary signatures, forms won't be processed.
Step 5: Mail within 30 days and retain copies
Within 30 days of the transaction date, submit Form 05-179 and the most recent Form 05-901 to the Texas Comptroller. For your own records and to prepare for your return, make copies of all documents you submit.
Common Mistakes and How to Avoid Them
- Missing the 30-day filing deadline: File within 30 days of the transfer date so the new credit certificate is issued in time for upcoming tax reports.
- Submitting an incomplete form: Confirm signatures, identification numbers, and all credit fields are complete and accurate before submission.
- Making partial-transfer calculation errors: Reconcile the transferred amount and retained balance so the total does not exceed the approved credit amount.
- Claiming the credit before the new Form 05-901 is issued: Wait to claim the credit until the Texas Comptroller issues the updated certificate reflecting the transfer.
- Skipping a final document check before filing: Attach the most recent supporting certificate and retain copies to ensure that processing is not delayed by missing documentation.
What Happens After You File
After Texas Form 05-179 is received, the Texas Comptroller updates credit ownership records within the Division of Revenue. Processing typically takes about four weeks from receipt of a complete and properly signed filing.
Once processing is complete, each entity with a remaining balance receives an updated Form 05-901 showing the revised historic structure credit amount. The credit cannot be claimed on tax reports until this updated certificate is issued.
FAQs
Who is required to file Texas Form 05-179?
Any Texas business, partnership, S corporation, or trust company that sells, assigns, or allocates a historic structure credit must file Form 05-179 within 30 days of the transaction date.
Can a historic structure credit be sold in multiple portions?
A historic structure credit may be divided and sold to multiple buyers. Each transaction requires a separate Form 05-179, and the total amount transferred cannot exceed the approved credit limit.
Is there an amended version of Texas Form 05-179?
There is no amended version of the form. Errors are corrected by submitting a new form with accurate information and coordinating directly with the Texas Comptroller.
How long can a historic structure credit be used?
The credit may be claimed for six consecutive tax years, beginning with the year the property is placed in service, as shown on the Certificate of Eligibility.
Does the historic structure credit apply to federal income tax returns?
The credit does not apply to federal income tax returns. It applies only to Texas Franchise Tax Reports and qualifying insurance premium tax reports.
What agencies are involved in approving historic structure credits?
Approval requires collaboration between the Texas Comptroller, state agencies, and preservation standards, as well as adherence to the federal Secretary of the Interior's guidelines and cultural resources.
Can historic structure credits be transferred to entities outside of the state?
Under Texas law, credits can only be transferred to businesses that have to pay the Texas Franchise Tax or meet the requirements for the Texas Insurance Premium Tax.
