SB185 Summary: The Railroad Modernization Act of 2019

• Authorizes a state income tax credit equal to 50 percent of qualified railroad reconstruction or replacement expenditures for eligible taxpayers (Class II or Class III railroads) for tax years beginning after December 31, 2019.

• Limits the credit to $3,500 multiplied by the number of miles of railroad track owned or leased within the state, with unused credits carried forward up to five subsequent tax years.

• Allows eligible taxpayers to transfer all or part of the credit to other state income taxpayers through a written transfer agreement filed with the Department of Revenue within 30 days, with a $1,000 transfer fee per transaction.

• Permits transferees to use transferred credits to offset any income tax liability, but credits may not be transferred again after the initial transfer.

• Credits granted to partnerships, limited liability companies, S corporations, trusts, or estates must be claimed at the entity level and do not pass through to individual partners, members, or owners.