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With tax season coming to a close and a presidential election on the horizon, the bipartisan tax bill that passed the House of Representatives earlier this year is facing significant legislative headwinds in the Senate.

The bipartisan agreement, brokered by Rep. Jason Smith (R-MO) and Sen. Ron Wyden (D-OR), Chairmen of the House Ways and Means Committee and Senate Finance Committee, respectively, is a $79 billion tax bill, known as H.R. 7024 – the Tax Relief for American Families and Workers Act.

It is a two-year compromise aimed at aligning various expired tax extenders.

The bill lays much of the groundwork for 2025, when Congress is expected to take up broad-reaching tax policy in anticipation of the expiration of several fundamental provisions of the Tax Cuts and Jobs Act of 2017.

Key components of the current bipartisan compromise include provisions for business investments, child tax credits, and affordable housing, funded by adjustments to the Employee Retention Tax Credit.

While the bill passed the Ways and Means committee 40-3, and then cleared the full House with strong bipartisan support in a 357-70 vote, its fate in the Senate remains uncertain.

Longtime champion of the Historic Tax Credit, Congressman Blumenauer (D-OR) introduced, but later withdrew, an amendment that would have added the Historic Tax Credit Growth and Opportunity Act (HTC-GO, H.R. 1785 / S. 639) to the legislation.

The amendment was withdrawn to avoid adding to the cost of the bill and threatening the delicate bipartisan support for the broader legislation.

With strong lobbying from the business community and child tax credit supporters, some Senators have indicated support for the bill’s passage while others have called for modifications to the bill to earn their support.

The fate of the Tax Relief for American Families and Workers Act in the 118th Congress is uncertain, but the debate around the legislation will inform how the House and Senate tax-writing committees approach tax legislation that will be necessary in 2025 to avoid the expiration of major tax provisions enacted as part of the Tax Cuts and Jobs Act of 2017.

Historic tax credit advocates are considering longer-term strategies to build support for the incentive and deepen ties with existing supporters.

As we move past the midway point of the 118th Congress, support for the Historic Tax Credit Growth and Opportunity Act (H.R. 1785 / S. 639) (HTC-GO) is in a strong position to surpass the previous record number of cosponsors.

Current co-sponsorship of HTC-GO is 51 bipartisan members in the House (28 Democrats, 23 Republicans) and 13 members in the Senate (7 Democrats, 5 Republicans, and 1 Independent).

At the end of the 117th Congress, there were more than 104 cosponsors in the House and 15 in the Senate.

With Preservation Advocacy week coming up, supporters have an important opportunity to emphasize the important role federal historic tax credits have had in their communities and that passing HTC-GO will give communities throughout the nation greater ability to preserve their historic resources, revitalized their economies, and create local jobs.

A rare, bipartisan tax package passed the House by a wide margin in February and is now being considered in the Senate.

While HTC-GO provisions were not included in the House bill, now is the time to urge your delegation to include the bipartisan, community-building, low-cost provisions of HTC-GO in the Tax Relief for American Families Act today!

In recent legislative developments, both Florida and Missouri are exploring changes to their state historic tax credit (HTC) programs.

In Florida, Senate Bill 1166 proposes the establishment of a state HTC equivalent to 20% of qualified rehabilitation expenditures (QREs). Properties located in active Main Street program areas would enjoy an additional 10% bonus. The credit comes with an annual project cap of $200,000 and a multiyear project cap of $1 million, while the statewide annual cap is set at $25 million. If enacted, this bill, introduced for the fourth consecutive year, would take effect on July 1, reflecting the state's ongoing commitment to historic preservation through incentivized rehabilitation projects.

In Missouri, House Bill 1936, seeks to enhance the state HTC by retaining the existing 25% credit while providing a substantial boost to 35% of QREs for developments in counties without a city with 400,000 or more residents. This proposed legislation introduces standards for qualifying QREs for the bonus credit, extends eligibility to residential properties certified as historic structures or located in distressed communities, and exempts from the statewide cap any single certified historic structure exceeding 1 million square feet that meets specific requirements. These legislative initiatives in both states highlight ongoing efforts to adapt and optimize state HTC programs, encouraging historic rehabilitation and preservation endeavors.

In September of 2023, the Historic Tax Credit Coalition (HTCC) issued a report called Historic Preservation and the Federal Historic Tax Credit—Addressing Challenges of the 21st Century.

The report looks back at the 40-year history of the federal historic credit (HTC) and makes recommendations to modernize the incentive.

It offers an important review of the HTC program from users of the credit as well as suggests ways to improve the administration of the program, which is proving especially necessary as the market for commercial rehabilitation projects becomes more complex and challenging.

The report calls for greater flexibility in the interpretation of the Secretary of the Interior’s Standards and the need for more regulatory guidance.

For its part, the National Park Service recently held a widely-attended HTC training in Washington on September 26th and this month has issued new guidance on the use of substitute materials for historic rehabilitation projects.

Support for the Historic Tax Credit Growth and Opportunity Act (S.639 / H.R. 1785) (HTC-GO) continues to grow as members of Congress are hearing from constituents and advocates in Washington.

New co-sponsors in the House and Senate include Sens. Robert Casey (D-PA) and Diane Feinstein (D-CA) and Reps. Lloyd Smucker (R-PA), Richard Hudson (R-NC), Marcy Kaptur (D-OH), Troy Carter (D-LA), Jimmy Gomez (D-CA), Trent Kelly (R-Mississippi), Garret Graves (R-LA), Dwight Evans (D-PA), Brad Finstad (R-MN), and Betty McCollum (D-MN).

Take the opportunity to thank these members for their support, and encourage others in your Congressional delegation who have not yet cosponsored HTC-GO to do so!

Growing the number of cosponsors of the legislation will show that strengthening the historic tax credit incentive is supported across the political spectrum and would be a well-supported addition to any legislation moving through Congress.