KRS § 141.385 — KY Code / Title XI / Chapter 141 / Section 141.385
141.385 Nonrefundable tax credit for railroad improvement
Status: in_force

141.385 Nonrefundable tax credit for railroad improvement.

(1) As used in this section:

(a) "Class II railroad" means a railroad company classified as a Class II carrier by

the federal Surface Transportation Board;

(b) "Class III railroad" means a railroad company classified as a Class III carrier

by the federal Surface Transportation Board;

(c) "Qualified expenditures" means expenditures, whether or not otherwise

chargeable to a capital account, that are made to maintain or improve railroads

located in Kentucky, including roadbeds, bridges, and related structures, that

are owned or leased as of January 1, 2008, by a Class II or Class III railroad;

and

(d) "Eligible taxpayer" means:

1. The owner of any Class II railroad or Class III railroad located in

Kentucky; or

2. Any person who transports property using the rail facilities of a Class II

railroad or Class III railroad located in Kentucky or furnishes railroad-

related property or services to a Class II railroad or Class III railroad

located in Kentucky, but only with respect to miles of railroad track

assigned to the person by a Class II railroad or Class III railroad for

purposes of subsection (3) of this section.

(2) For taxable years beginning after December 31, 2009, an eligible taxpayer shall be

entitled to a nonrefundable credit against the taxes imposed by KRS 141.020 or

141.040, and 141.0401 with the ordering of credits as directed in KRS 141.0205, in

an amount equal to fifty percent (50%) of the qualified expenditures paid or

incurred by the taxpayer during the taxable year.

(3) The credit allowed under subsection (2) of this section shall not exceed the product

of:

(a) Three thousand five hundred dollars ($3,500) multiplied by:

(b) The sum of:

1. The number of miles of railroad track in Kentucky owned or leased by

the eligible taxpayer as of the close of the taxable year; and

2. The number of miles of railroad track in Kentucky assigned for purposes

of this section to the eligible taxpayer by a Class II railroad or Class III

railroad which owns or leases the railroad track as of the close of the

taxable year.

(4) A mile of railroad track may be taken into account by a qualified taxpayer other

than the owner only if the mile of railroad track is assigned to the person by the

owner for purposes of this section. Any mile that is so assigned shall not be taken

into account by the owner for purposes of this section.

(5) With respect to any assignment of a mile of railroad track under subsection (4) of

this section:

(a) The assignment may be made only once per taxable year of the Class II

railroad or Class III railroad and shall be treated as made as of the close of the

taxable year;

(b) The mile shall not be taken into account under this section by the railroad for

such taxable year; and

(c) The assignment shall be taken into account for the taxable year of the

assignee, which includes the date that the assignment is treated as effective.

(6) If a credit is taken as provided for in subsection (2) of this section, the basis of the

track shall be reduced by the amount of credit taken.