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53	53	STATE OF OKLAHOMA
54	54
55	55	2nd Session of the 59th Legislature (2024)
56	56
57	57	SENATE BILL 1299 By: Rader
58	58
59	59
60	60
61	61
62	62
63	63	AS INTRODUCED
64	64
65	65	An Act relating to income tax credit; amending 68
66	66	O.S. 2021, Section 2357.104, as amended by Section 1,
67	67	Chapter 33, 1st Extraordinary Ses sion, O.S.L. 2023
68	68	(68 O.S. Supp. 2023, Section 2357.104), which relates
69	69	to credit for certain railroad e xpenditures; making
70	70	credit refundable for certain tax years ; requiring
71	71	submission of documentation to the Department of
72	72	Transportation for credit eligibility; and providing
73	73	an effective date.
74	74
75	75
76	76
77	77
78	78
79	79	BE IT ENACTED BY THE PEOPL E OF THE STATE OF OKLAHOMA:
80	80	SECTION 1. AMENDATORY 68 O.S. 2021, Section 2357.104, as
81	81	amended by Section 1, Chapter 33, 1st Extraordinary Session, O.S.L .
82	82	2023 (68 O.S. Supp. 2023, Section 2357.104), is amended to read as
83	83	follows:
84	84	Section 2357.104. A. Except as otherwise provided by this
85	85	section, for taxable y ears beginning after December 31, 2005, and
86	86	ending before January 1, 2030, there shall be allowed a credit
87	87	against the tax imposed by Section 2355 of this t itle equal to fifty
88	88	percent (50%) of an eligible taxpayer ’s qualified railroad
89	89	reconstruction or replacement expenditures.
90	90
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141	141	B. For tax years 2020 th rough 2029, the amount of the credit
142	142	shall be limited to the product of Five Thousand Dollars ($5,000. 00)
143	143	and the number of miles of railroad track owned or leased within
144	144	this state by the eligible taxpayer a s of the close of the taxable
145	145	year.
146	146	C. The For tax years 2006 through 202 4, the credit allowed
147	147	pursuant to subsection A of this sec tion but not used shall be
148	148	freely transferable, by written agreement, to subsequent transferees
149	149	at any time during the five (5) ye ars following the year of
150	150	qualification. An eligible transferee shall be any taxpayer subject
151	151	to the tax imposed by Section 2 355 of this title. The person
152	152	originally allowed the credit and the subsequent transferee shall
153	153	jointly file a copy of the written credit transfer agreement with
154	154	the Oklahoma Tax Commission within thirty (30) days of the transfer.
155	155	The written agreement s hall contain the name, address, and taxpayer
156	156	identification number of the parties to the transfer, the amount of
157	157	credit being transferred, the year the credit was originally allowed
158	158	to the transferring per son, and the tax year or years for which the
159	159	credit may be claimed. The Tax Commission shall promulgate ru les to
160	160	permit verification of the timeliness of a tax credit claimed upon a
161	161	tax return pursuant to this subsection but shall not promulgate any
162	162	rules which unduly restrict or hinder the transfers of suc h tax
163	163	credit. The Department of Transportation shall promulgate rules to
164	164	permit verification of the eligibility of an eligible ta xpayer’s
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216	216	expenditures for the purpose of claiming the credit. The rules
217	217	shall provide for the approval of qualified railroad reconstruction
218	218	or replacement expenditures prior to co mmencement of a project and
219	219	provide a certificate of verification up on completion of a project
220	220	that uses qualified railroad reconstruction or replacem ent
221	221	expenditures. The certificate of verification s hall satisfy all
222	222	requirements of the Tax Commission pertaining to the eligibility of
223	223	the person claiming the credit.
224	224	D. Any For tax years 2006 through 2024, credits allowed
225	225	pursuant to the provisions of subsection A o f this section but not
226	226	used in any tax year may be carried over in orde r to each of the
227	227	five (5) years following the year of qualification. For tax year
228	228	2025 and subsequent tax years, if the credit exceeds the tax imposed
229	229	by Section 2355 of this title, th e excess amount shall be refunded
230	230	to the taxpayer.
231	231	E. As used in this section:
232	232	1. “Class II and Class III rail road” means a railroad that is
233	233	classified by the United States Surface Tra nsportation Board as a
234	234	Class II or Class III railroa d;
235	235	2. “Eligible taxpayer” means any Class II or C lass III
236	236	railroad; and
237	237	3. “Qualified railroad reconstruction or replacement
238	238	expenditures” means expenditures for:
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290	290	a. track maintenance, natural disasters , and
291	291	reconstruction or replacement of railroad
292	292	infrastructure including track, roadbed, crossings,
293	293	bridges, industrial leads, and track-related
294	294	structures owned or leased by a Class II or Class III
295	295	railroad as of January 1, 2006, or
296	296	b. new construction of industrial leads, switches, spurs,
297	297	and sidings and extensions of existing sidings by a
298	298	Class II or Class III railroad.
299	299	F. The total amount of credits authorized by this section used
300	300	to offset tax shall be adjusted annually to li mit the annual amount
301	301	of credits to Two Million Dollars ($2,000,000.00) for tax years 2018
302	302	and 2019 and Five Million Dollars ($5,000,000.00) for tax year 2020
303	303	and all subsequent tax years. The Tax Commission s hall annually
304	304	calculate and publish a percentage by which the credits auth orized
305	305	by this section shall be reduced so the total amount of credits used
306	306	to offset tax does not exceed the applicable annual limit. The
307	307	formula to be used for the percentage adju stment shall be the
308	308	applicable annual limit di vided by the credits claimed in the second
309	309	preceding year.
310	310	G. Pursuant to subse ction F of this section, in the event the
311	311	total tax credits authorized by this section exceed the annual
312	312	applicable limit in any c alendar year, the Tax Commission shall
313	313	permit any excess over the annual a pplicable limit but shall factor
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365	365	such excess into the percentage adjustment formula for subsequent
366	366	years.
367	367	H. For tax year 2025 and subsequent tax years, to be eligible
368	368	to claim the credit provided in this section, the taxpayer shall
369	369	submit documentation to the Department of Transportation which shall
370	370	include the following :
371	371	1. The name of the entity;
372	372	2. Total project expenditures related to the rec onstruction or
373	373	replacement; and
374	374	3. Whether the construction project was completed as part of a
375	375	broader economic development project, including any partnership with
376	376	local government entities or economic development organizations.
377	377	SECTION 2. This act shall become effective November 1, 2024.
378	378
379	379	59-2-2470 QD 12/12/2023 5:51:05 PM

Oklahoma 2024 Regular Session

Oklahoma Senate Bill SB1299 Compare Versions