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Apply online through the City's tax credit system before any work begins, pay the application fee, and include the pre-improvement appraisal. Get CHAP's written preliminary approval, build to the approved plans, close out permits, order the post-improvement appraisal, and file the final package. The deadline for new applications is December 31, 2027.
I am Ed Drost, a Maryland State Certified Residential Appraiser. I see CHAP files at two points, the pre-improvement appraisal and the post-improvement appraisal, and I see where files go wrong. Most problems are about order, not paperwork. This is part of our Baltimore appraisal Q&A series. For the full process, see the CHAP Historic Tax Credit Guide.
What are the steps, in order?
- Confirm eligibility. The property must be on the National Register individually or in a district, be a Baltimore City Landmark, or contribute to a City historic district. See which neighborhoods qualify.
- Document the house as it is. Take dated photos before you touch anything and prepare a clear scope of work.
- Apply online first. Submit through the Department of Finance's tax credit system and pay the $50 application fee. Do not start any work.
- Order the pre-improvement appraisal. It goes in with the application. The regulation allows up to 90 days from submission.
- Get preliminary approval in writing. An application with no preliminary approval after 180 days expires.
- Build to the approved plans. Send CHAP a written amendment before any change in scope, plans, owner or applicant.
- Close out permits and keep every inspection certificate.
- Order the post-improvement appraisal. It is due within 90 days of the final U&O permit or last permit inspection.
- File the final package, including a notarized statement of project costs, with receipts on request.
- Receive final certification. The 10-year credit starts with the first tax bill after it.
For projects up to $3.5 million, plan to finish within two years of preliminary approval. One two-year extension is available.
What five mistakes cost owners their credit?
| Mistake | Why it hurts | What to do instead |
|---|---|---|
| 1. Starting work early | Work begun before the initial appraisal is not considered, and work before preliminary approval can make the property ineligible. | Wait for written preliminary approval. Ask CHAP in writing about limited early items such as basement excavation, underpinning or formstone removal. |
| 2. Changing the plan without telling CHAP | Changes in scope, plans, owner or applicant need a written amendment. Without one the credit can be revoked. | Send the amendment before you do the work. If revoked, you get 90 days to reverse the unapproved changes. |
| 3. Doing extra work | Work beyond the approved plans, other than standard maintenance, can make the property ineligible. | Keep to the approved scope. Ask first. |
| 4. Paying with weak records | Costs must be paid in full and documented. Estimates are not accepted. | Keep invoices, proof of payment and a running cost log. |
| 5. Missing a deadline | Applications expire after 180 days without preliminary approval, and the post-improvement appraisal is due within 90 days of the final U&O permit. | Put each clock on a calendar the day you apply. |
What is the deadline for new applications?
Under the City's regulations, no new applications may be filed after December 31, 2027. Legislation has extended program dates before, so confirm the current date with CHAP, but I would not plan around another extension. Because approval comes before the work, and the work takes time, a late application is simply a lost credit.
What does it cost to apply?
The application fee is $50. Beyond that, plan for the two appraisals, which are paid by you, and the construction costs themselves. The appraisal fees count toward the 25% minimum, since the City counts appraisal among the allowable costs. See our Appraisal Cost Guide for current fees.
What should you do if your application is denied or stalled?
Ask the Department of Finance and CHAP for the reason in writing and match it against the list above. Most problems trace to timing, missing documents or an unapproved change. If the issue is the appraisal, call the appraiser. If the issue is the scope of work, go back to CHAP's Historic Design Guidelines before you resubmit.
Common questions
Do I apply to CHAP or to the Department of Finance?
Both are involved. You submit through the Department of Finance's online tax credit system, and CHAP reviews the work for compliance with its Historic Design Guidelines.
What is the application fee?
$50, paid with the online application.
Can I start work while my application is pending?
Not without CHAP's written permission. Work between submission and preliminary approval can make the property ineligible. CHAP can approve limited early items such as basement excavation, underpinning and formstone removal.
How long do I have to finish the work?
For projects up to $3.5 million, plan to finish within two years of preliminary approval. One two-year extension is available.
What is the last day to apply?
Under the current regulations, December 31, 2027. Confirm with CHAP before you rely on it.
When does the credit begin?
With the first tax bill after final certification.
Sources
- Baltimore City Historic Tax Credit, CHAP
- Historic Tax Credit FAQ, CHAP
- Historic Tax Credit Rules and Regulations, Baltimore City Department of Finance (effective December 14, 2020)
This article is general information, not legal, tax or financial advice. Program rules change and every project is different. Confirm current requirements with CHAP and the Baltimore City Department of Finance before you start work.
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