What Texas Form 05-179 (2020) Is For
When ownership of a historic structure credit changes, the Texas Comptroller must be notified using Texas Form 05-179. This form is required when a tax credit associated with a certified historic building is transferred, sold, or assigned to a different taxpayer.
The historic structure credit is part of Texas’s landmark structure rehabilitation program and applies to Certified Historic Structures approved through a Certificate of Eligibility. The credit equals a percentage of qualified rehabilitation expenditures incurred during an approved Certified Rehabilitation project.
Form 05-179 works in coordination with Form 05-901 and the Form 05-901 Historic Structure Credit Certificate. Filing this form enables the Comptroller to update ownership records and issue revised certificates, allowing the credit to be applied to Texas Franchise Tax or insurance premium tax reports.
When You’d Use Texas Form 05-179
If the owner of a historic structure's credit changes during its eligible tax years, Texas Form 05-179 must be filed. This includes full sales, partial transfers, or splitting up the ownership of flow-through entities.
Limited Liability Companies, S corporation entities under subchapter S, partnerships, trust company structures, and joint venture arrangements commonly use this form. When ownership interests shift as a result of restructuring or real estate transactions involving historic properties, the form is also necessary.
The filing deadline is 30 days from the date of the transaction. Late filing is allowed, but the new owner cannot use the credit on tax returns until the Texas Comptroller processes the transfer and issues a revised Tax Credit Certificate.
Key Rules or Details for 2020
Both the transferring party and the recipient must sign Texas Form 05-179. Missing signatures are a frequent cause of rejection and delay the ability to claim the historic structure credit.
The six-year claiming period does not restart even if the credit is transferred multiple times. The initial placed-in-service date authorized by the Certificate of Eligibility continues to determine eligibility for the taxable year.
Only partners, members, or shareholders of pass-through entities are eligible to receive credits. Insurance premium tax reports must include a sale or assignment in compliance with the Texas Tax Code and cannot claim credits obtained through allocation.
Step-by-Step (High Level)
The current credit owner should confirm that the project is connected to a certified historic structure and verify the available credit balance before completing the form. The ownership information must match the records used to file Texas franchise taxes previously.
The following items should be gathered before submission:
- The original Form 05-901 Historic Structure Credit Certificate
- The Certificate of Eligibility for the qualified historic structure
- Cost certification records supporting qualified rehabilitation expenditures
- Current taxpayer details consistent with the Public Information Report or Ownership Information Report
Both parties should fill out Texas Form 05-179 with their full legal names, taxpayer numbers, and the date of the transaction. The parties must confirm that the amount of credit that was transferred is correct and does not go over the amount shown on the certificate.
Until both parties have signed and dated the form, it cannot be submitted. The signed Form 05-179 and the original Form 05-901 must be mailed to the Texas Comptroller within 30 days of the transaction date.
Common Mistakes and How to Avoid Them
- Submitting the form with only one signature: Obtain signatures from both the seller and the recipient on the same form before submission to avoid rejection.
- Missing the 30-day filing deadline: File within 30 days of the transaction date so certificate issuance is not delayed and the credit can be used on upcoming tax reports.
- Attempting prohibited allocations: Confirm eligibility and allocation limits under the Texas Tax Code before transferring or allocating credits, especially for insurance premium taxpayers and other restricted entities.
- Providing information that does not match Comptroller records: Match ownership names, taxpayer identification numbers, and entity details to Texas Comptroller records precisely.
- Reporting credit amounts that do not reconcile: Ensure the transferred amount and any retained balance tie exactly to the certificate amount before submitting.
What Happens After You File
The Texas Comptroller reviews Texas Form 05-179 for accuracy and compliance upon receipt. Ownership, qualified rehabilitation costs, and compliance with previous filings are all confirmed by the review.
After the paperwork is finished, processing can take up to four weeks. If clarification is required on gross receipts, total revenue, or the classification of taxable entities, there may be delays.
After getting the go-ahead, the Comptroller sends out new Form 05-901 certificates. Unlike partial transfers, which create multiple certificates that show both the transferred and remaining balances, complete transfers give the new owner just one certificate.
FAQs
Who must file Texas Form 05-179?
Any taxpayer transferring ownership of a historic structure credit must file Texas Form 05-179. This includes flow-through entities, S corporation filers, and other taxable entities.
What qualifies as a historic structure for this credit?
A historic building must be on the National Register of Historic Places or be named a Recorded Texas Historic Landmark to be considered qualified. The Secretary of the Interior's Standards for Rehabilitation must be followed for approval.
Can the credit be used for income tax purposes?
The Texas historic structure credit does not directly affect federal income tax. Section 47 of the Internal Revenue Code may permit federal tax treatment of certain expenses.
Can part of the credit be transferred?
Partial transfers are permitted. The Texas Comptroller issues separate certificates showing the transferred amount and any remaining balance.
How does late filing affect the credit?
Late filing delays certificate issuance, but does not void the transfer. The credit cannot be claimed on tax reports until processing is complete.
Are there any federal agencies involved in the approval process?
The National Park Service and the Secretary of the Interior may have federal oversight during the application process. The Cultural Resources Division and state agencies also review projects.
Does this form apply outside Texas?
Texas Form 05-179 applies only to Texas credits. Other states, such as Kansas, Minnesota, New York, and North Carolina, administer separate programs under their own statutes and revenue notices.
