AR HB1456

Creates the Railroad Modernization Act of 2021 by establishing a new income tax credit for Class II and Class III railroads for railroad track maintenance expenditures in Arkansas.

Allows an income tax credit equal to 50% of eligible railroad track maintenance expenditures, capped at $5,000 multiplied by the number of miles of railroad track owned or leased in the state.

Permits unused income tax credits to be carried forward for 5 consecutive tax years and allows credits to be transferred to other income tax-paying taxpayers through written agreement filed with the Department of Finance and Administration within 30 days.

Requires the Department of Commerce to adopt rules for verification of maintenance expenditures, pre-project approval, and issuance of certificates of verification upon project completion.

Effective for tax years beginning on or after January 1, 2021.