Form 8900 Qualified Railroad Track Maintenance Credit

Form

8900

Department of the Treasury
Internal Revenue Service

OMB No. 1545-1983

Qualified Railroad Track Maintenance Credit
▶

2013

▶ Attach to your tax return.
Information about Form 8900 and its instructions is at www.irs.gov/form8900.

Attachment
Sequence No. 144
Identifying number

Name(s) shown on return

1

Qualified railroad track maintenance expenditures paid or incurred (see
instructions) . . . . . . . . . . . . . . . . . . .

1
Enter 50% (.50) of line 1 . . . . . . . . . . . . . . . . . . . . . .
Number of miles of railroad track owned or leased by you (see
instructions) . . . . . . . . . . . . . . . . . . .
3a
b Less: number of miles of railroad track owned or leased by you and
assigned to other eligible taxpayers for purposes of this credit. See
instructions for more information, including required statement . . .
3b (
c Number of miles of railroad track assigned to you by the owner or
lessee for purposes of this credit. See instructions for more
information, including required statement . . . . . . . . .
3c
d Total. Combine lines 3a through 3c . . . . . . . . . . . . . . . . . .
4
Multiply line 3d by $3,500 . . . . . . . . . . . . . . . . . . . . .
5
Enter the smaller of line 2 or line 4 . . . . . . . . . . . . . . . . . .
6
Qualified railroad track maintenance credit from partnerships and S corporations . . .
7
Add lines 5 and 6. Partnerships and S corporations, report this amount on Schedule K. All
others, report this amount on Form 3800, line 4g . . . . . . . . . . . . . .
2
3a

General Instructions
Section references are to the Internal Revenue Code
unless otherwise noted.

Who Must File
Eligible taxpayers use Form 8900 to claim the railroad
track maintenance credit (RTMC) for qualified railroad
track maintenance expenditures (QRTME) paid or
incurred during the tax year. If you are an assignor of
miles of eligible railroad track, you must file Form 8900
even if you do not claim any RTMC. See the instructions
for line 3b for the additional information that must be
provided by assignors.
Taxpayers, other than partnerships and S corporations,
whose only source of this credit is from a partnership or S
corporation, are not required to complete or file this form.
Instead, they can report this credit directly on Form 3800.

Definitions
Eligible taxpayers include:
1. Any Class II or Class III railroad, as these terms are
defined by the Surface Transportation Board.
2. Any person (including a Class I railroad (see below))
who transports property using the rail facilities of a Class
II or Class III railroad.
3. Any person (including a Class I railroad (see below))
who furnishes railroad-related services or property to a
Class II or Class III railroad.
For purposes of 2 or 3 above, the taxpayer is only
eligible to claim the credit for miles of eligible railroad
track assigned to it by a Class II or Class III railroad for
purposes of the credit. See the instructions for line 3c.

For Paperwork Reduction Act Notice, see instructions.

.

.

2

.

)

.
.
.
.

.
.
.
.

▶

.
.
.

3d
4
5
6

.

.

.

7

Class I railroads include only the following seven
entities:
• BNSF,
• CSX,
• Grand Trunk Corporation (a holding company for all of
Canadian National's U.S. railroad operations),
• Kansas City Southern,
• Norfolk Southern,
• Soo Line (owned by Canadian Pacific), and
• Union Pacific.
Rail facilities of a Class II or Class III railroad are railroad
yards, tracks, bridges, tunnels, wharves, docks, stations,
and other related assets that are used in the transport of
freight by a railroad and owned or leased by that railroad.
Railroad-related property is property that is provided
directly to a Class II or Class III railroad and is unique to
railroads. For a complete description, see Regulations
section 1.45G-1(b)(7).
Railroad-related services are services that are provided
directly to, and are unique to, a railroad and that relate to
railroad shipping, loading and unloading of railroad
freight, or repairs of rail facilities or railroad-related
property. For examples of what are and what are not
railroad-related services, see Regulations section
1.45G-1(b)(8).
Eligible railroad track is railroad track located within the
United States that is owned or leased by a Class II or
Class III railroad at the close of its tax year. The railroad is
treated as owning the railroad track if it is subject to
depreciation under section 167 by the railroad. Double

Cat. No. 37708X

Form 8900 (2013)

Form 8900 (2013)

track is treated as multiple lines of railroad track, rather
than as a single line of railroad track. That is, one mile of
single track is one mile, but one mile of double track is
two miles.
Qualifying railroad structure is property located within
the United States that includes, in part, tunnels, bridges,
and railroad track. For a complete description, see
Regulations section 1.45G-1(b)(4).
QRTME are expenditures (whether or not otherwise
chargeable to a capital account) for maintaining,
repairing, and improving a qualifying railroad structure
that is owned or leased as of January 1, 2005, by a Class
II or Class III railroad. If you paid or incurred QRTME
during the tax year, you do not have to reduce that
QRTME by any amount of direct or indirect
reimbursement to which you are entitled from a Class II or
Class III railroad which made an assignment of eligible
railroad track to you.

Adjustments to Basis
Some or all of the QRTME paid or incurred by an eligible
taxpayer may be required to be capitalized as a tangible
asset or an intangible asset, if applicable. See
Regulations section 1.45G-1(e)(1).
Use the amount of RTMC to reduce the basis of a
qualifying railroad structure (including railroad track) asset
or intangible asset, if applicable. The reduction is limited
to the amount of QRTME capitalized for the asset. For
further details, see Regulations section 1.45G-1(e)(2).

Member of Controlled Group or Business
Under Common Control
For purposes of figuring the credit, all members of a
“controlled group of corporations” and all members of a
“group of businesses under common control” are treated
as a single taxpayer. See Regulations section
1.45G-1(f)(2) for a definition of these terms. As a member,
your credit is determined on a proportionate basis to your
share of the aggregate QRTME taken into account by the
group for the RTMC. Enter your share of the credit on line
5. Attach a statement showing how your share of the
credit was figured, and write “See Attached” next to the
entry space for line 5.

Specific Instructions
Line 1
Qualified railroad track maintenance expenditures must
be paid or incurred by an eligible taxpayer during the tax
year.

Page 2

The payment by an eligible taxpayer, as an assignee, to
a Class II or Class III railroad, as an assignor, in exchange
for an assignment of miles of eligible railroad track for
purposes of the credit computation is treated as QRTME
paid or incurred by the assignee and not the assignor.
Line 3a (This line only applies to you if you are a Class II
or Class III railroad.)
Enter the number of eligible railroad track miles (see
Eligible railroad track above) owned or leased by you.
Line 3b (This line only applies to you if you are a Class II
or Class III railroad.)
You must reduce on line 3b the number of miles of
eligible railroad track entered on line 3a that you assigned
to another eligible taxpayer for purposes of the credit
computation. You can only assign each mile of railroad
track once during your tax year. Each mile of railroad
track that you assign is treated as being assigned on the
last day of your tax year.
An assigned mile of eligible railroad track need not
correspond to any specific mile of eligible railroad track
for which the eligible taxpayer actually pays or incurs the
QRTME. Further, an assignment requires no transfer of
legal title or other indicia of ownership of the eligible
railroad track, and need not specify the location of any
assigned mile of eligible railroad track. However, the
following information must be provided for the
assignment in the form of a statement attached to the tax
return for the tax year for which the assignment is made.
• The name and taxpayer identification number of each
assignee.
• The total number of miles of the assignor's eligible
railroad track.
• The number of miles of eligible railroad track assigned
by the assignor for the tax year to the assignee.
• The total number of miles of eligible railroad track
assigned by the assignor for the tax year to all assignees.
Line 3c
The following information must be provided for the
assignment in the form of a statement attached to the tax
return for the tax year for which the assignment is made.
• The total number of miles of eligible railroad track
assigned to the assignee for the assignee's tax year.
• Attestation that the assignee has in writing, and has
retained as part of the assignee's records for purposes of
Regulations section 1.6001-1(a), the following information
from each assignor:
a. The name and taxpayer identification number of each
assignor;

Form 8900 (2013)

b. The effective date of each assignment (treated as
being made by the assignor at the end of its tax year) to
the assignee; and
c. The number of miles of eligible railroad track assigned
by each assignor to the assignee for the tax year of the
assignee.
Notes. 1. The assignee cannot reassign miles.
2. If the assignor, in its required statement (see
the instructions for line 3b above), assigns more miles
than it has at the end of its tax year, the excess will be
used to reduce each assignee's allocation in the same
proportion as the assignee's original allocation of miles
bears in relation to the total miles originally assigned.
Paperwork Reduction Act Notice. We ask for the
information on this form to carry out the Internal Revenue
laws of the United States. You are required to give us the
information. We need it to ensure that you are complying
with these laws and to allow us to figure and collect the
right amount of tax.

Page 3

You are not required to provide the information
requested on a form that is subject to the Paperwork
Reduction Act unless the form displays a valid OMB
control number. Books or records relating to a form or its
instructions must be retained as long as their contents
may become material in the administration of any Internal
Revenue law. Generally, tax returns and return
information are confidential, as required by section 6103.
The time needed to complete and file this form will vary
depending on individual circumstances. The estimated
burden for individual taxpayers filing this form is approved
under OMB control number 1545-0074 and is included in
the estimates shown in the instructions for their individual
income tax return. The estimated burden for all other
taxpayers who file this form is shown below.
Recordkeeping . . . . . . . . . . . 4 hr., 4 min.
Learning about the law or the form . . . . 53 min.
Preparing and sending the form to the IRS . . 1 hr.
If you have comments concerning the accuracy of
these time estimates or suggestions for making this form
simpler, we would be happy to hear from you. See the
instructions for the tax return with which this form is filed.