Authorizes a tax credit for certain railroad expenses

SECOND REGULAR SESSION
HOUSE BILL NO. 2941
103RD GENERAL ASSEMBL Y
INTRODUCED BY REPRESENT A TIVE JOBE.
6454H.01I JOSEPH ENGLER, Chief Clerk
AN ACT
T o amend chapter 135, RSMo, by adding thereto one new section relating to a tax credit for
qualified railroad infrastructure investments.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapter 135, RSMo, is amended by adding thereto one new section, to be
2 known as section 135.1210, to read as follows:
135.1210. 1. As used in this section, the following terms mean:
2 (1) "Eligible customer", a person who uses any railro ad or railro ad-relat ed
3 pr operty , facilities, or structur es located wholly or partly within the state of Missouri to
4 dir ectly or indirect ly transport pr operty , commodities, or goods, or who is served by any
5 railr oad, or who stor es railcars on any railr oad in Missouri;
6 (2) "Eligible taxpayer":
7 (a) Any short line railr oad company located wholly or partly in the state of
8 Missouri that is classified by the United States Surface T ransportation board as a Class
9 II or Class III railr oad; or
10 (b) Any owner or lessee of a rail siding, industrial spur , or industry track located
11 on or adjacent to any railr oad in the state of Missouri;
12
13 and subject to the tax imposed under chapter 143 or 148 who made qualified railr oad
14 expenditur es in Missouri or qualified new rail infrastructur e expenditures in Missouri
15 during the tax year for which a cred it under this section is claimed;
16 (3) "Eligible vendor", a person who prov ides railr oad-rel ated services dir ectly to
17 an eligible taxpayer;
EXPLANA TION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is
intended to be omitted from the law . Matter in bold-face type in the above bill is proposed language.
18 (4) "Person", the same meaning as defined under section 1.020;
19 (5) "Qualified amount", for any eligible taxpayer in a given tax year , an amount
20 equal to fifty perc ent of an eligible taxpayer's qualified railr oad expenditur es or
21 qualified new rail infrastructur e expenditur es, pr ovided that:
22 (a) For qualified railr oad expenditures , the amount of the state tax cr edit shall
23 not exceed an amount equal to the pr oduct of five thousand dollars multiplied by the
24 number of miles of railr oad track owned or leased in the state by a Class II or Class III
25 railr oad as of the close of the tax year; and
26 (b) For qualified new rail infrastructur e expenditures , the amount of the state
27 tax credit shall not exceed one million dollars for each new rail-served customer pr oject
28 of an eligible taxpayer;
29 (6) "Qualified new rail infrastructur e expenditures ", gross expenditur es for new
30 rail infrastructur e by an eligible taxpayer , which includes the construction of new track
31 infrastructur e such as industrial leads, switches, spurs, sidings, rail loading docks, and
32 transloading structures involved with servicing new customer locations or expansions by
33 any railro ad located in Missouri;
34 (7) "Qualified railr oad expenditur es", gross expenditur es for maintenance,
35 r econstruction, or r eplacement of railr oad infrastructur e, including track, r oadbed,
36 bridges, industrial leads and sidings, and track-r elated structure s owned or leased by a
37 Class II or Class III railr oad located in Missouri. "Qualified railr oad expenditur es"
38 does not include expenditur es used to generate a federal tax cred it or expenditures
39 funded by a state or federal grant;
40 (8) "Railr oad-rela ted services", includes, but is not limited to, the following:
41 transport of frei ght by rail; loading and unloading of fr eight transported by rail;
42 railr oad bridge services; railr oad track construction; pro vision of railr oad track
43 material or equipment; locomotive or fr eight train car leasing or rent al; pr ovision of
44 railr oad financial services, including banking or insurance; maintenance of a railr oad's
45 right-of-way , including vegetation contr ol; and frei ght train car rep air , rehab ilitation, or
46 r emanufacturing repa ir services;
47 (9) "State tax cr edit", a credi t against the tax otherwise due under chapter 143
48 or 148, excluding withholding tax imposed under sections 143.191 to 143.265.
49 2. For all tax years beginning on or after January 1, 2027, an eligible taxpayer
50 shall be allowed to claim a nonr efundable state tax cr edit for qualified railr oad track
51 expenditur es in Missouri or for qualified new rail infrastructur e expenditures in
52 Missouri against the taxpayer's state tax liability in an amount equal to the taxpayer's
53 qualified amount.
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54 3. An eligible taxpayer who seeks to claim a state tax cred it under this section
55 shall submit a certificate of eligibility to the Missouri department of economic
56 development after completion of the qualified railr oad expenditures or qualified new
57 rail infrastructure expenditures . The certificate shall include the number of miles of
58 railr oad track owned or leased in this state and a description of the amount of qualified
59 railr oad expenditures or qualified new rail infrastructur e expenditures completed. The
60 certificate shall be made on forms and in the manner prescribed by the department and
61 consider ed in the order received .
62 4. If the department of economic development determines that the taxpayer
63 meets the requ irem ents to claim a state tax cr edit under this section, the department
64 may issue a certificate of eligibility to the eligible taxpayer . The certificate shall be
65 number ed for identification and declar e its date of issuance and the amount of the state
66 tax credi t allowed under this section.
67 5. (1) The cumulative amount of state tax cred its under this section authorized
68 for qualified railr oad expenditur es in this state shall not exceed four million five
69 hundr ed thousand dollars per calendar year . If the amount of state tax cr edits claimed
70 in a calendar year under this section for qualified railr oad expenditures exceeds four
71 million five hundr ed thousand dollars, state tax cr edits shall be allowed based on the
72 order in which they ar e claimed.
73 (2) The cumulative amount of state tax cr edits under this section authorized for
74 qualified new rail infrastructur e expenditures in this state shall not exceed ten million
75 dollars per calendar year . If the amount of state tax credits claimed in a calendar year
76 under this section for qualified new rail infrastructur e expenditur es exceeds ten million
77 dollars, state tax cr edits shall be allowed based on the order in which they are claimed.
78 6. Any unused portion of a state tax cre dit allowed under this section may be
79 carried forward for up to five subsequent tax years immediately following the tax year
80 the state tax cr edit was allowed.
81 7. (1) Subject to the r equir ements of this subsection, an eligible taxpayer who
82 earns and is entitled to the state tax cr edit or to an unused portion of the state tax credit
83 allowed by this section may transfer all or a portion of the unused state tax credi t by
84 written agr eement to any eligible customer , eligible vendor , or any taxpayer subject to
85 the tax imposed under chapter 143 or 148, at any time during the year in which the state
86 tax cred it is earned and the five years following the year of the qualified expenditures .
87 The taxpayer originally allowed the state tax cr edit and the subsequent transfer ee shall
88 jointly file a copy of the written state tax credit transfer agr eement with the department
89 of r evenue and the department of economic development. The agr eement shall include
90 the name, addr ess, and taxpayer identification number of the parties to the transfer; the
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91 amount of the state tax credi t being transferr ed; the year the state tax cre dit was
92 originally allowed to the transferring taxpayer; and the tax year or years for which the
93 state tax credit may be claimed. In the event of such a transfer , the transferee may claim
94 the state tax cr edit on the transfer ee’ s tax ret urn originally due during the calendar year
95 in which the transfer takes place only for tax years that begin on or after January 1,
96 2027, and in the case of carryover of the state tax cr edit, on the transfer ee’ s ret urns for
97 the number of years of carryover available to the transfero r at the time of the transfer
98 unless earlier exhausted.
99 (2) In the event that after the transfer the department of reven ue determines
100 that the amount of the state tax cred it pr operly available under this section is less than
101 the amount claimed by the transferor of the state tax cr edit or that the state tax credi t is
102 subject to recap tur e, the department shall assess the amount of overstated or recap tur ed
103 state tax credi t as taxes due fr om the transfero r and not the transfer ee. The assessment
104 shall be made in the manner pr ovided for a deficiency in taxes under state law .
105 8. Notwithstanding section 32.057 or any other confidentiality law , the
106 department of economic development shall pr epar e an annual r eport for the general
107 assembly outlining the state tax cr edit transfers that take place each calendar year ,
108 listing the qualified railr oad expenditur es and qualified new rail infrastructur e
109 expenditur es for each eligible taxpayer and a statement summarizing the investments
110 made by the eligible taxpayer .
111 9. The department of economic development may pr omulgate rules governing
112 the allowance of the state tax cred it provi ded for in this section, including pro visions for
113 the verification of the timeliness of a claim, the process and documentation requ ired for
114 the department of economic development to appr ove a state tax cre dit for qualified
115 railr oad expenditur es or qualified new rail infrastructur e expenditures , and any
116 documentation that the department of economic development req uires in order to
117 determine that an eligible taxpayer , eligible customer , or eligible vendor meets the
118 r equir ements of this section. In addition to other needed rules, the department of
119 economic development may promul gate rules prescrib ing, in the case of S corporations
120 or partnerships, a method of attributing the state tax credit under this section to the
121 shar eholders or partners in pr oportion to their share of the income fr om the S
122 corporation or partnership. A state tax cred it issued or transferr ed under this section to
123 an estate or trust may be used by the r elevant fiduciary against the fiduciary income tax
124 imposed under section 143.061.
125 10. The department of reven ue and the department of economic development
126 shall promul gate all necessary rules and r egulations for the administration of this
127 section including, but not limited to, rules r elating to the verification of a taxpayer's
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128 qualified amount. Any rule or portion of a rule, as that term is defined in section
129 536.010, that is creat ed under the authority delegated in this section shall become
130 effective only if it complies with and is subject to all of the pro visions of chapter 536 and,
131 if applicable, section 536.028. This section and chapter 536 are nonseverable and if any
132 of the powers vested with the general assembly pursuant to chapter 536 to re view , to
133 delay the effective date, or to disappr ove and annul a rule are subsequently held
134 unconstitutional, then the grant of rulemaking authority and any rule prop osed or
135 adopted after August 28, 2026, shall be invalid and void.
136 1 1. Under section 23.253 of the Missouri sunset act:
137 (1) The prov isions of the new pr ogram authorized under this section shall sunset
138 six years after the effective date of this section, unless rea uthorized by an act of the
139 general assembly;
140 (2) This section shall terminate on September first of the calendar year
141 immediately following the calendar year in which the prog ram authorized under this
142 section is sunset; and
143 (3) Nothing in this subsection shall pr event a taxpayer fr om claiming a state tax
144 cr edit pr operly issued before this pro gram was sunset in a tax year after the pro gram is
145 sunset.
✔
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