Downtown property owner penalized for tax credit ‘double-dipping’

The Garfield on Euclid Avenue in Downtown Cleveland was built in 1895 as an 11-story
office building. In 2016, while it was getting renovated as apartments, its owner claimed
a $22.6 million tax deduction on the property for not building a 34-story addition above
it. That apparently improper deduction may prove costly to the owner (Google).
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A U.S. Tax Court judge in Washington D.C. has agreed with the Internal Revenue Service (IRS) in disallowing a $22.6 million tax deduction claimed by Corning Place Ohio, LLC for not building a 34-story vertical addition on top of its 19th-century Garfield Building, 1965 E. 6th St., in Downtown Cleveland. Senior Judge Albert George Lauber also sustained the IRS commissioner’s imposition of a 40 percent penalty for a “gross valuation misstatement” in seeking the deduction.

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