What Texas Form 05-179 (2012) Is For
Texas Form 05-179 must be used to report the sale, assignment, or allocation of a historic structure credit acquired through the restoration of a landmark structure that has received Texas certification. The Texas Comptroller of Public Accounts is formally notified of the change in credit ownership.
This form creates the official record that identifies the taxable entities that possess the historic structure credit and the remaining balance for each reporting entity. The Texas Comptroller is unable to issue updated certificates or update credit records without this filing.
It is possible to apply the historic structure credit to qualifying insurance premium tax reports or the Texas Franchise Tax. Although the federal Internal Revenue Code is mentioned, it cannot be used to offset income tax or federal tax returns.
When You’d Use Texas Form 05-179
When a historic structure credit is transferred to another entity, sold for cash, or distributed among pass-through entity owners, Texas Form 05-179 needs to be submitted. Transfers between partnerships, S corporations, trust companies, limited liability companies, and other taxable entities are included in this.
Within 30 days of the transaction date, the form must be submitted. Regardless of the fiscal year, taxable year, or total revenue reported by the reporting entity, this deadline is applicable.
Although it may cause a delay in the issuance of new certificates, filing after the deadline does not render the transfer invalid. Due to these delays, the buyer might not be able to claim the credit on their tax returns for specific years.
Key Rules or Details for 2012
The historic structure credit is equal to 25% of the costs of qualified rehabilitation work performed in accordance with an approved qualified rehabilitation plan. Costs that can be used for rehabilitation include structural repairs, electrical wiring, and mechanical systems related to the rehabilitation of historic buildings.
Both the buyer and the seller must sign Form 05-179, and the filing must include Form 05-901, which is the current Tax Credit Certificate. This certificate is necessary for us to process transfers.
More rules must be followed:
- The amount sent cannot exceed the seller's available credit.
- The total credit is still limited by the original rehabilitation credit limit.
- Only businesses that are required to pay the Texas Franchise Tax or the qualifying insurance premium tax are eligible to claim the credit.
- Insurance companies may only use credits acquired through purchase or assignment under the Texas Insurance Code.
Step-by-Step (High Level)
Gather Required Documentation
To avoid delays in processing and facilitate the timely issuance of revised certificates, all parties should gather the necessary paperwork before completing Texas Form 05-179.
Assemble the Required Supporting Documents
- The current Form 05-901 Tax Credit Certificate
- The Certificate of Eligibility issued through the historic structure rehabilitation program
- The cost certification supporting qualified rehabilitation expenditures
Complete the Form’s Three Sections
Form 05-179 is divided into three sections that should be completed consistently to ensure the transaction is recorded correctly.
Fill Out Part A for the Seller or Assignor
Part A identifies the seller or assignor and requires the legal name, federal identification number, mailing address, and ownership interest information for the reporting entity.
Fill Out Part B for the Buyer or Assignee
Part B identifies the buyer or assignee, and the information must match what is reported on the Texas Franchise Tax Report, Public Information Report, or Ownership Information Report.
Complete Part C With Transaction Details
Part C documents the transaction date, the credit amount transferred, the seller’s balance before the transfer, and the remaining balance afterward.
Sign, Date, and Submit Within 30 Days
Both parties must sign and date the document; otherwise, it will be rejected and returned unprocessed. The completed form and any required attachments must be mailed to the Texas Comptroller of Public Accounts in Austin, Texas, within 30 days of the transaction date.
Common Mistakes and How to Avoid Them
- Missing the 30-day filing deadline: Prepare and submit the form immediately after the transaction date to avoid delays.
- Failing to include Form 05-901: Attach the existing Tax Credit Certificate so the Texas Comptroller can update credit balances.
- Math errors in the transfer amounts: Confirm that the transferred amount plus the retained amount equals the seller’s original credit balance.
- Claiming the credit before the revised certificate is issued: Wait to claim the credit until the updated Form 05-901 is issued after the transfer is processed.
- Misunderstanding insurance premium taxpayer restrictions: Confirm eligibility and do not apply credits established through ownership or allocation to insurance premium tax reports.
What Happens After You File
The Texas Comptroller of Public Accounts checks the Texas Form 05-179 for accuracy, completeness, and compliance with the Texas Tax Code after it is sent in. The review checks the historic structure credit balances that are available and makes sure that all the necessary paperwork has been turned in.
After processing is complete, the Texas Comptroller issues new Tax Credit Certificates that reflect the new ownership and the remaining credit amount. To properly apply the credit and lower their tax bill, the buyer must use the updated certificate when filing Texas Franchise Tax or insurance premium tax reports.
FAQs
Can only part of a historic structure credit be sold or assigned?
Yes, a seller may transfer any portion of the available historic structure credit while retaining the remaining balance for future use or transfer.
Can a buyer resell the credit to another party?
Yes, Texas law allows unlimited transfers, provided a new Form 05-179 is filed within 30 days for each transaction.
Can pass-through entities allocate credits unevenly?
Yes, partnerships, limited liability companies, and S corporation entities may allocate credits based on internal agreements rather than ownership percentages.
Can the credit be used against income tax?
No, the credit applies only to Texas Franchise Tax or qualifying insurance premium tax reports and does not offset income tax.
What agencies are involved in approving historic structure credits?
Approval involves coordination with state agencies responsible for historic properties and cultural resources before cost certification and credit issuance.
What happens if errors are found after filing?
The Texas Comptroller does not accept amended Form 05-179 filings. Errors must be corrected directly with the Comptroller’s office.
