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The budget bill passed by Congress and signed by President Trump early this morning includes a one-year extension of the short-line tax credit known as Section 45G, the American Short Line and Regional Railroad Association (ASLRRA) confirmed today.
The tax credit was extended retroactively for calendar-year 2017 and expired Dec. 31, ASLRRA officials said in an email. The tax credit previously had expired at 2016's end.
"The short-line tax credit extension benefits the 10,000 short-line railroad shippers across the country," said ASLRRA President Linda Bauer Darr in a press release. "The continuation of this credit is good public policy, allowing our industry to do its share toward improving the nation's infrastructure by incentivizing railroads to increase their capital investment. The extension will allow short lines to continue their success story serving rural, industrial and agricultural America."
The tax credit enables regionals and short lines to claim a 50-cent tax credit for each dollar they spend on track rehabilitation and maintenance projects, up to a cap of $3,500 per mile of owned or leased track.
The tax credit has helped small railroads invest $4 billion in capital infrastructure improvements since it was enacted in 2005, according to the ASLRRA.
The association continues to lobby for a permanent or 10-year extension of the Section 45G provision.