Technically speaking, eligible expenses include any work that is properly chargeable to a building’s capital account in connection with a certified rehabilitation. Essentially, this means that all work done to structural components of the building will be eligible, as well as certain soft costs such as architectural and engineering fees, construction period interest and taxes, construction management costs, and reasonable developer fees. Expenses related to new heating, plumbing and electrical systems are eligible, as well as expenses related to updating kitchens and bathrooms, compliance with ADA, and fire suppression systems and fire escapes.
Costs that are not eligible include acquisition costs, any expenses attributable to additions or enlargements of the building (including excavation), personal property such as appliances, and certain soft costs such as legal fees for syndication. Under the Federal program, site work, landscaping elements, solar, and geothermal systems are not eligible expenses. Under the State Program, certain historic, man-made landscape features may be eligible. See the “Eligible and Ineligible Costs” document for more information.
Please keep in mind that the overall work completed for the entire project must Standards; credits cannot be claimed only on the portions of the work that meet the Standards. Therefore, if the overall project does not meet the Standards, no part of the credit may be claimed. If the work is certified as meeting the Standards, the credit is based on all eligible expenses.