Rehabilitation Tax Exemptions and Incentives

Residential Incentive Program

Chesterfield County allows a partial real estate tax exemption for the rehabilitation, renovation or replacement of older residential structures. Upon approval, the partial exemption will be in effect for 15 years and transfers with the real estate. The amount of the exemption is based solely on the increase in assessed value, not the amount spent on the improvement project, and does not change over the 15-year period. 

Program Eligibility

This program is available to property owners who rehabilitate, renovate or replace residential structures, subject to the following criteria:

• Residential structures must be at least 25 years of age.
• Structures between 15 and 25 years of age may qualify if the real estate assessment reflects an above normal (10% or greater) physical depreciation.
• The structure must be lawfully used for residential purposes.
• The rehabilitation, renovation or replacement must increase the assessed value of the structure by at least 10%.
• For multifamily residences, the rehabilitation, renovation or replacement must not increase the total square footage of the structure by more than 30%.
• For residential structures other than multifamily, the exemption shall apply only to the first 200% of any increase in square footage due to replacement or rehabilitation.
• Landscaping, driveways, fencing or other detached improvements do not qualify under this program.

Program Process

Community Enhancement administers this program, which incorporates requirements with from the Building Inspection and Real Estate Assessments departments. County staff reviews your application for completeness and determines whether it may qualify for the exemption program.

Building Inspection

• Appropriate building permits must first be issued by Building Inspection.
• Within 24 months after the filing date of the building permit application for the rehabilitation, renovation or replacement, the property owner may apply for an exemption.
• All work must be completed and approved by Building Inspection.

Real Estate Assessments

• All increases in the assessed value during the time of the rehabilitation, renovation or replacement is being performed shall be taxable annually until all work has been completed and approved.
• Real Estate Assessments must be notified of such completion of work by Dec. 31 in order for the exemption to be effective Jan. 1 of the following calendar year.
• In any year in which the market value of the qualified real estate decreases below the base value, no credit or refund shall be provided.

Apply for the Residential Incentive Program

Complete the online residential application or download the residential application (PDF). The PDF version of the application can be emailed to Community Enhancement or mailed to:

Community Enhancement
P.O. Box 40
Chesterfield, VA 23832

Commercial and Industrial Incentive Program

Chesterfield County allows a partial real estate tax exemption for the rehabilitation, renovation or replacement of older commercial or industrial structures. Upon approval, the partial exemption will be in effect for 10 years and transfers with the real estate. The amount exempt from tax will be based solely on the amount of increase in assessed value resulting from the rehabilitation, renovation or replacement and does not change over the 10-year period.

Program Eligibility

This program is available to property owners who rehabilitate, renovate or replace commercial structures or industrial, subject to the following criteria:

• Commercial or industrial structures must be at least 20 years of age. (15 years if located in a Technology Zone).
• Motel or hotel structures must be at least 35 years of age.
• The exemption shall apply to 200% of the square footage of the original structure(s) replaced or rehabilitated for residential use.
• In any year in which the market value of the qualified real estate decreases below the base value, no credit or refund shall be provided.
• The rehabilitation, renovation or replacement must increase the assessed value by 10% or more, or by 5% or more for structures with an existing assessed value of at least $10 million.

Program Process

Community Enhancement administers this program, which incorporates requirements with from the Building Inspection and Real Estate Assessments departments. County staff reviews your application for completeness and determines whether it may qualify for the exemption program.

Building Inspection

• Appropriate building permits must first be issued by Building Inspection.
• Within 24 months after the filing date of the building permit application for the rehabilitation, renovation or replacement, the property owner may apply for an exemption.
• All work must be completed and approved by Building Inspection.

Real Estate Assessments

• All increases in the assessed value during the time of the rehabilitation, renovation or replacement is being performed shall be taxable annually until all work has been completed and approved.
• Real Estate Assessments must be notified of such completion of work by Dec. 31 in order for the exemption to be effective Jan. 1 of the following calendar year.

Apply for the Commercial and Industrial Incentive Program

Complete the online commercial and industrial application or download the commercial and industrial application (PDF). The PDF version of the application can be emailed to Community Enhancement or mailed to:

Community Enhancement
P.O. Box 40
Chesterfield, VA 23832

Historic Incentive Program

Rehabilitation of any structure that has been designated as a county historical landmark or is located in an area that has been designated a county historical district may be considered for partial exemption from real estate taxes. For those properties that qualify, the amount of the partial tax exemption is based on the amount of increase in assessed value that is attributable to the rehabilitation work. This exemption does not change, and it transfers with the real estate for a 10-year period. The exemption is limited to a $500,000 increase in assessed value. 

Program Eligibility

This program is available to property owners who rehabilitate historic structures meeting the following criteria: 

• All improvements made to the structure must be approved by the Preservation Committee.
• The structure must be a designated county historical landmark or located in an area that has been designated a county historical district.
• The structure must be 50 years or older.
• Following the completion of the rehabilitation or renovation, the assessed value of the structure must be increased by at least 25%
• In any year in which the market value of the qualified real estate decreases below the base value, no credit or refund shall be provided.

Program Process

Community Enhancement administers this program, which incorporates requirements with from the Building Inspection and Real Estate Assessments departments. County staff reviews your application for completeness and determines whether it may qualify for the exemption program.

Building Inspection

• Appropriate building permits must first be issued by Building Inspection.
• Within 24 months after the filing date of the building permit application for the rehabilitation,  the property owner may apply for an exemption.

Real Estate Assessments

• All increases in the assessed value during the time the rehabilitation work is being performed shall be taxable annually until all work has been completed and approved.
• Real Estate Assessments must be notified of such completion of work by Dec. 31 in order for the exemption to be effective Jan. 1 of the following calendar year.
• All exemptions shall be effective on Jan. 1 of the year following completion and approval of the rehabilitation work.

Apply for the Historic Incentive Program

Complete the online historic application or download the historic application (PDF). The PDF version of the application can be emailed to Community Enhancement or mailed to:

Community Enhancement
P.O. Box 40
Chesterfield, VA 23832

Non-Eligible Projects

Several types of improvements and/or replacement projects don’t qualify for rehabilitation tax exemptions.

Improvement/replacement of accessory structures, such as:

• Arbors
• Detached carports
• Detached decks
• Detached garages
• Fences
• Detached gazebos
• Retaining walls
• Sheds
• Signs
• Swimming pools

Improvement/replacement of items that are not considered to be a structure, such as:

• Driveways
• Grading and flatwork
• Landscaping
• Manufactured/mobile home that is not real property
• Parking lots
• Walkways

Improvement/replacement projects that don’t meet minimum program requirements of minimum age, do not have or require a building permit, and do not increase the minimum assessed structure value by at least 10%, or 25% (historic). For residential projects, certain types of projects often do not increase the assessed value of the structure by at least 10%. This includes:

• Crawl space repairs, including sealing, liners, sill replacement, joist sistering and dehumidifiers
• Routine maintenance or replacement of existing floors, HVAC equipment, paint, roofing  and/or siding 
• Screened porches
• Solar panels
• Sunrooms