HOUSE BILL NO. 2941 103RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE JOBE.
6454H.01I JOSEPH ENGLER, Chief Clerk
AN ACT To 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 railroad or railroad-related 3 property, facilities, or structures located wholly or partly within the state of Missouri to 4 directly or indirectly transport property, commodities, or goods, or who is served by any 5 railroad, or who stores railcars on any railroad in Missouri; 6 (2) "Eligible taxpayer": 7 (a) Any short line railroad company located wholly or partly in the state of 8 Missouri that is classified by the United States Surface Transportation board as a Class 9 II or Class III railroad; or 10 (b) Any owner or lessee of a rail siding, industrial spur, or industry track located 11 on or adjacent to any railroad in the state of Missouri; 12 13 and subject to the tax imposed under chapter 143 or 148 who made qualified railroad 14 expenditures in Missouri or qualified new rail infrastructure expenditures in Missouri 15 during the tax year for which a credit under this section is claimed; 16 (3) "Eligible vendor", a person who provides railroad-related services directly to 17 an eligible taxpayer;
EXPLANATION — 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. HB 2941 2
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 percent of an eligible taxpayer's qualified railroad expenditures or 21 qualified new rail infrastructure expenditures, provided that: 22 (a) For qualified railroad expenditures, the amount of the state tax credit shall 23 not exceed an amount equal to the product of five thousand dollars multiplied by the 24 number of miles of railroad track owned or leased in the state by a Class II or Class III 25 railroad as of the close of the tax year; and 26 (b) For qualified new rail infrastructure expenditures, the amount of the state 27 tax credit shall not exceed one million dollars for each new rail-served customer project 28 of an eligible taxpayer; 29 (6) "Qualified new rail infrastructure expenditures", gross expenditures for new 30 rail infrastructure by an eligible taxpayer, which includes the construction of new track 31 infrastructure 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 railroad located in Missouri; 34 (7) "Qualified railroad expenditures", gross expenditures for maintenance, 35 reconstruction, or replacement of railroad infrastructure, including track, roadbed, 36 bridges, industrial leads and sidings, and track-related structures owned or leased by a 37 Class II or Class III railroad located in Missouri. "Qualified railroad expenditures" 38 does not include expenditures used to generate a federal tax credit or expenditures 39 funded by a state or federal grant; 40 (8) "Railroad-related services", includes, but is not limited to, the following: 41 transport of freight by rail; loading and unloading of freight transported by rail; 42 railroad bridge services; railroad track construction; provision of railroad track 43 material or equipment; locomotive or freight train car leasing or rental; provision of 44 railroad financial services, including banking or insurance; maintenance of a railroad's 45 right-of-way, including vegetation control; and freight train car repair, rehabilitation, or 46 remanufacturing repair services; 47 (9) "State tax credit", a credit 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 nonrefundable state tax credit for qualified railroad track 51 expenditures in Missouri or for qualified new rail infrastructure expenditures in 52 Missouri against the taxpayer's state tax liability in an amount equal to the taxpayer's 53 qualified amount. HB 2941 3
54 3. An eligible taxpayer who seeks to claim a state tax credit under this section 55 shall submit a certificate of eligibility to the Missouri department of economic 56 development after completion of the qualified railroad expenditures or qualified new 57 rail infrastructure expenditures. The certificate shall include the number of miles of 58 railroad track owned or leased in this state and a description of the amount of qualified 59 railroad expenditures or qualified new rail infrastructure expenditures completed. The 60 certificate shall be made on forms and in the manner prescribed by the department and 61 considered in the order received. 62 4. If the department of economic development determines that the taxpayer 63 meets the requirements to claim a state tax credit under this section, the department 64 may issue a certificate of eligibility to the eligible taxpayer. The certificate shall be 65 numbered for identification and declare its date of issuance and the amount of the state 66 tax credit allowed under this section. 67 5. (1) The cumulative amount of state tax credits under this section authorized 68 for qualified railroad expenditures in this state shall not exceed four million five 69 hundred thousand dollars per calendar year. If the amount of state tax credits claimed 70 in a calendar year under this section for qualified railroad expenditures exceeds four 71 million five hundred thousand dollars, state tax credits shall be allowed based on the 72 order in which they are claimed. 73 (2) The cumulative amount of state tax credits under this section authorized for 74 qualified new rail infrastructure 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 infrastructure expenditures exceeds ten million 77 dollars, state tax credits shall be allowed based on the order in which they are claimed. 78 6. Any unused portion of a state tax credit 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 credit was allowed. 81 7. (1) Subject to the requirements of this subsection, an eligible taxpayer who 82 earns and is entitled to the state tax credit 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 credit by 84 written agreement 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 credit is earned and the five years following the year of the qualified expenditures. 87 The taxpayer originally allowed the state tax credit and the subsequent transferee shall 88 jointly file a copy of the written state tax credit transfer agreement with the department 89 of revenue and the department of economic development. The agreement shall include 90 the name, address, and taxpayer identification number of the parties to the transfer; the HB 2941 4
91 amount of the state tax credit being transferred; the year the state tax credit 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 credit on the transferee’s tax return 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 credit, on the transferee’s returns for 97 the number of years of carryover available to the transferor at the time of the transfer 98 unless earlier exhausted. 99 (2) In the event that after the transfer the department of revenue determines 100 that the amount of the state tax credit properly available under this section is less than 101 the amount claimed by the transferor of the state tax credit or that the state tax credit is 102 subject to recapture, the department shall assess the amount of overstated or recaptured 103 state tax credit as taxes due from the transferor and not the transferee. The assessment 104 shall be made in the manner provided 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 prepare an annual report for the general 107 assembly outlining the state tax credit transfers that take place each calendar year, 108 listing the qualified railroad expenditures and qualified new rail infrastructure 109 expenditures for each eligible taxpayer and a statement summarizing the investments 110 made by the eligible taxpayer. 111 9. The department of economic development may promulgate rules governing 112 the allowance of the state tax credit provided for in this section, including provisions for 113 the verification of the timeliness of a claim, the process and documentation required for 114 the department of economic development to approve a state tax credit for qualified 115 railroad expenditures or qualified new rail infrastructure expenditures, and any 116 documentation that the department of economic development requires in order to 117 determine that an eligible taxpayer, eligible customer, or eligible vendor meets the 118 requirements of this section. In addition to other needed rules, the department of 119 economic development may promulgate rules prescribing, in the case of S corporations 120 or partnerships, a method of attributing the state tax credit under this section to the 121 shareholders or partners in proportion to their share of the income from the S 122 corporation or partnership. A state tax credit issued or transferred under this section to 123 an estate or trust may be used by the relevant fiduciary against the fiduciary income tax 124 imposed under section 143.061. 125 10. The department of revenue and the department of economic development 126 shall promulgate all necessary rules and regulations for the administration of this 127 section including, but not limited to, rules relating to the verification of a taxpayer's HB 2941 5
128 qualified amount. Any rule or portion of a rule, as that term is defined in section 129 536.010, that is created under the authority delegated in this section shall become 130 effective only if it complies with and is subject to all of the provisions 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 review, to 133 delay the effective date, or to disapprove and annul a rule are subsequently held 134 unconstitutional, then the grant of rulemaking authority and any rule proposed or 135 adopted after August 28, 2026, shall be invalid and void. 136 11. Under section 23.253 of the Missouri sunset act: 137 (1) The provisions of the new program authorized under this section shall sunset 138 six years after the effective date of this section, unless reauthorized 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 program authorized under this 142 section is sunset; and 143 (3) Nothing in this subsection shall prevent a taxpayer from claiming a state tax 144 credit properly issued before this program was sunset in a tax year after the program is 145 sunset. ✔
Statutes affected: