(B) A taxpayer who is not eligible for a federal income tax credit under Section 47 of the Internal Revenue Code and who makes rehabilitation expenses for a certified historic residential structure located in this State is allowed to claim a credit against the tax imposed by this chapter. The amount of the credit is twenty-five percent of the rehabilitation expenses. To claim the credit allowed by this subsection, the taxpayer must attach to the return a copy of the certification obtained from the State Historic Preservation Officer verifying that the historic structure has been rehabilitated in accordance with this subsection, along with all information that the Department of Revenue determines is necessary for the calculation of the credit provided by this subsection.

1. (1) "Certified historic residential structure" means a structure or portion of a structure that is an owner-occupied personal residence if the residence is not actively used in a trade or business, held for the production of income, or held for sale or disposition in the ordinary course of the taxpayer's trade or business; and that is:

   1. (a) listed individually in the National Register of Historic Places;
   2. (b) considered by the State Historic Preservation Officer to contribute to the historic significance of a National Register Historic District;
   3. (c) considered by the State Historic Preservation Officer to meet the criteria for individual listing in the National Register of Historic Places; or
   4. (d) an outbuilding of an otherwise eligible property considered by the State Historic Preservation Officer to contribute to the historic significance of the property.
2. (2) "Certified rehabilitation" means repairs or alterations consistent with the Secretary of the Interior's Standards for Rehabilitation and certified as such by the State Historic Preservation Officer before commencement of the work. The review by the State Historic Preservation Officer shall include all repairs, alterations, rehabilitation, and new construction on the certified historic residential structure and the property on which it is located. The rehabilitation expenses must, within a thirty-six-month period, exceed fifteen thousand dollars. A taxpayer shall not take more than one credit on the same certified historic residential structure within ten years.

3. (3) "Rehabilitation expenses" means expenses incurred in the certified rehabilitation of a certified historic residential structure, including preservation and rehabilitation work done to the exterior of a historic structure, repair and stabilization of historic structural systems, restoration of historic plaster, energy efficiency measures except insulation in frame walls, repairs or rehabilitation of heating, air-conditioning, or ventilating systems, repairs or rehabilitation of electrical or plumbing systems exclusive of new electrical appliances and electrical or plumbing fixtures, and architectural and engineering fees.

   "Rehabilitation expenses" do not include the cost of acquiring or marketing the property, the cost of new construction beyond the volume of the existing building, the value of an owner's personal labor, or the cost of personal property.

4. (4) "State Historic Preservation Officer" means the Director of the Department of Archives and History or the director's designee who administers the historic preservation programs within the State.

For the purposes of this subsection:

(C)

1. (1) The entire credit may not be taken for the taxable year in which the property is placed in service, but must be taken in equal installments over a five-year period beginning with the year in which the property is placed in service. For a certified rehabilitation of a certified historic residential structure "placed in service" is defined as the taxable year the certified rehabilitation is completed. Any unused portion of any credit installment may be carried forward for the succeeding five years.
2. (2) A "S" corporation, limited liability company, or partnership that qualifies for a credit under this section may pass through the credit earned to each shareholder of the "S" corporation, member of the limited liability company, or partner of the partnership. For purposes of this subsection, limited liability company means a limited liability company taxed as a partnership. The amount of the credit allowed a shareholder, member, or partner by this subsection is equal to the shareholder's percentage of stock ownership, member's interest in the limited liability company, or the partner's interest in the partnership for the taxable year multiplied by the amount of the credit earned by the entity. The credit earned pursuant to this section by a "S" corporation owing corporate level income tax must be used first at the entity level. Only the remaining credit passes through to each shareholder.