HB457 - The Railroad Modernization Act of 2019

• Establishes a state income tax credit equal to 50 percent of qualified railroad reconstruction or replacement expenditures for Class II and Class III railroads classified by the U.S. Surface Transportation Board.

• Limits the credit to $3,500 multiplied by the number of miles of railroad track owned or leased within the state by the eligible taxpayer, with no refunds available if tax liability is less than the credit amount.

• Allows tax credits to be transferable one time to another taxpayer through a written transfer agreement filed with the Department of Revenue within 30 days, with a $1,000 transfer fee required.

• Permits unused credits to be carried over for up to five tax years following the year of qualification and allows credits granted to partnerships, LLCs, S corporations, trusts, or estates to pass through to individual partners, members, or owners.

• Tax credit is effective for tax years 2020 through 2024, unless extended by legislative action; Department of Transportation shall adopt verification rules for eligible expenditures prior to project commencement.