To amend the Internal Revenue Code of 1986 to modify the railroad track maintenance credit.
2/13/2025, 9:18 AMSummary of Bill HR 516
Bill 119 HR 516, also known as the Railroad Track Maintenance Credit Modification Act, aims to make changes to the Internal Revenue Code of 1986 specifically related to the railroad track maintenance credit. This credit is currently available to railroad track owners to help offset the costs of maintaining and improving their tracks.The proposed modifications in this bill seek to enhance and streamline the existing credit to better support the railroad industry. The bill does not eliminate the credit but rather makes adjustments to ensure it is more effective and efficient in promoting the maintenance and upkeep of railroad tracks.
The specifics of the modifications are not explicitly outlined in the summary, but it can be inferred that the changes will likely involve increasing the credit amount, expanding eligibility criteria, or simplifying the application process. These changes are intended to provide greater financial support to railroad companies and encourage them to invest in the maintenance and improvement of their tracks. Overall, Bill 119 HR 516 aims to strengthen the railroad industry by making necessary adjustments to the existing track maintenance credit. This legislation is important for ensuring the safety and efficiency of railroad transportation in the United States.
Congressional Summary of HR 516
This bill increases the annual limit on the tax credit for qualified railroad track maintenance expenses (also referred to as the short line railroad tax credit) and expands eligibility for claiming the credit.
Under current law, the tax credit is limited each tax year to $3,500 multiplied by the sum of the number of miles of railroad track owned or leased by the taxpayer (miles owned or leased) and the number of railroad track miles assigned to the taxpayer by a Class II or III railroad (miles assigned). This bill increases the annual limit to $6,100 multiplied by the sum of miles owned or leased and miles assigned. The $6,100 amount used in the calculation of the tax credit limit is adjusted for inflation for tax years beginning after 2025.
The bill also expands eligibility for the tax credit to include gross expenses for maintaining railroad tracks owned or leased as of January 1, 2024. Under current law, the tax credit is limited to gross expenses for maintaining railroad tracks owned or leased as of January 1, 2015.
