Freight Railroads

Important Reminders Before You Begin:

• Eligibility: Ensure your railroad is classified as a Class II or Class III railroad by the U.S. Surface Transportation Board.
• ​Documentation: You must have detailed documentation for all expenditures, including invoices, contracts, receipts, and proof of payment. The Minnesota Department of Revenue may request these documents for verification.
• ​Submission:​ Make a copy of the completed and signed Short Line Railroad Infrastructure Modernization Tax Credit Certificate Application for your records. Email the original completed application to Email: ShortLineTaxCertificate.DOT@state.mn.us.
• Approval: If the application is approved, the credit certificate will be issued to the eligible taxpayer within 30 days of receipt of the application.
• ​Deadlines: Pay close attention to the application deadline. Applications submitted after the deadline may not be considered.
• Read the Data Privacy Notice:
  • Data Privacy Statement Short Line Tax Credit Application

Application – Part 1: Project Category, Location and Miles of Railroad Track (Page 1)

• Railroad: Enter the legal name of the railroad as it is registered with the state. This should match the name on your tax return.
• ​Tax Year: Enter the tax year you are applying to receive the credit for.
• Project Category: Select the type of project performed.
• Project Location(s): Enter the subdivision of the project (if applicable). List the project start and end mile post. Only include locations your business owned or leased as of January 1, 2021, or locations of new construction of industrial leads, switches, spurs, and sidings and extensions of existing sidings.
• Project Location(s) Continued: Re-enter the subdivision of the project (if applicable). Continue entering the project start and end mile point.
• Miles of Railroad Track (Assets):
  • a) Enter the total number of miles of railroad track (assets) your business owned/ leased within the state as of 1/1/2021.
  • b) Enter the total number of miles of railroad track (assets) your business owned/ leased at the close of the tax year you are applying to receive the credit for. You must only count each mile of track once. This number is critical for calculating the credit cap.

Application – Part 2: Qualified Expenditures, Project and Railroad Information (Page 2)

• Cost Estimate: Enter the total amount of money you paid or incurred during the taxable year for qualified railroad reconstruction or replacement. This includes costs for: Track (rail, ties, ballast, surfacing, bridges work etc.).
• Proposed Project: Provide a brief, clear description of the project(s) for which you are claiming the credit. Include the location of the project (e.g., "Milepost 145.5 to 150.9, near [City Name]") and the nature of the work (e.g., "tie replacement," "bridge rehabilitation," etc.).
• Field Review Contact: Enter contact information (if applicable).
• Information for Tax Credit Certificate to be Issued: Enter the name, title/position, phone number and email address of the person the Minnesota Department of Transportation can contact if they have questions about the application. Enter the complete mailing address for the business. Enter Federal Tax Number and Minnesota Tax ID.

Application – Part 3: Authorization and Signature (Page 2)

1. Authorization: Enter the name, title/position, phone number and email address of the owner, officer, or authorized agent of the railroad. Sign and date the application. By signing, you are affirming that the information provided is accurate and that you have the authority to submit the application on behalf of the business.

Application – Part 4: Submittal Requirements (Page 2)

Submittal Requirements: Requirements when submitting the completed and signed application.