SB 28 RAIL INFRASTRUCTURE TAX CREDIT

Sen Crystal Diamond Brantley

Actions: [1] SCC/STBTC/SFC-SCC-germane-STBTC

Scheduled: Not Scheduled

 Senate Bill 28 (SB 28) creates the Rail Infrastructure Income Tax Credit and companion corporate income tax credit. 

 Senate Bill 28 (SB 28) creates the Rail Infrastructure Income Tax Credit (credit) and equivalent corporate tax credit for owners to maintain, construct, or replace railroad tracks. The credit is in the amount of 50% of qualified expenses not to exceed $5,000 per mile of track owned or leased that is reconstructed or replaced. For new infrastructure, the credit is capped at $1 million for each new project and total credits allowed in a year will not exceed $5 million for each taxpayer. The aggregate cap of credits is $6 million. The credit may be carried five years forward and applied to tax liability but is not refundable. 
  
Eligible railroads are Class II or III or an owner or lessee of an adjacent rail siding, yard track, industrial spur, or industry track. those earning up to $250 million in revenue. Qualifying expenses include industrial leads, switches, sidings and extensions, track, roadbed, bridges, and track-related structures. Non-qualifying reconstruction or replacement expenses are those used for federal tax credits or those funded by state or federal grants.
  
The Department of Transportation (DOT) is responsible for determining credit eligibility. The certificate may be filed with the taxpayer return or transferred to another taxpayer. SB 28 authorizes DOT to share return information with the Taxation and Revenue Department (TRD) which is charged with annual reporting of aggregate data and cost analysis to relevant legislative committees.
   
SB 28 provides a 10-year delayed repeal of the credits. The effective date of SB 28 is January 1, 2024.
 

 Currently, there is not a tax credit for railroad infrastructure costs.