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Department of the Treasury
Internal Revenue Service
Instructions for Form 8900

(Rev. February 2020)
Qualified Railroad Track Maintenance Credit

Section references are to the Internal Revenue Code unless Class I railroads include only the following seven entities.
otherwise noted. • BNSF.
• CSX.
• Grand Trunk Corporation (a holding company for all of Canadian
General Instructions National's U.S. railroad operations).
• Kansas City Southern.
Future Developments • Norfolk Southern.
For the latest information about developments related to Form 8900 • Soo Line (owned by Canadian Pacific).
and its instructions, such as legislation enacted after they were • Union Pacific.
published, go to IRS.gov/Form8900. Rail facilities. Rail facilities of a Class II or Class III railroad are
railroad yards, tracks, bridges, tunnels, wharves, docks, stations,
What’s New and other related assets that are used in the transport of freight by a
Credit extension. The qualified railroad track maintenance credit railroad and owned or leased by that railroad.
was retroactively extended to cover qualified railroad track Railroad-related property. Railroad-related property is property
maintenance expenditures paid or incurred in tax years beginning in that is provided directly to a Class II or Class III railroad and is
2018, 2019, 2020, 2021, or 2022. A safe harbor rule allows unique to railroads. For a complete description, see Regulations
assignments, including related expenditures paid or incurred, for tax section 1.45G-1(b)(7).
years beginning on or after January 1, 2018, and ending before
January 1, 2020, to be treated as effective as of the close of that tax Railroad-related services. Railroad-related services are services
year if made pursuant to a written agreement entered into no later that are provided directly to, and are unique to, a railroad and that
than March 19, 2020. relate to railroad shipping, loading and unloading of railroad freight,
or repairs of rail facilities or railroad-related property. For examples
Periodic updating. Form 8900 and its instructions will no longer be of what are and what are not railroad-related services, see
updated annually. Instead, they'll only be updated when necessary. Regulations section 1.45G-1(b)(8).
Use these instructions and the Form 8900 (Rev. February 2020) for
tax years beginning after 2017. For previous tax years, see the Eligible railroad track. Eligible railroad track is railroad track
applicable Form 8900 and instructions. For example, use the 2017 located within the United States that is owned or leased by a Class II
Form 8900 with the 2017 Instructions for Form 8900 for tax year or Class III railroad at the close of its tax year. The railroad is treated
ending December 31, 2017. as owning the railroad track if it is subject to depreciation under
section 167 by the railroad. Double track is treated as multiple lines
For 2018 claims, use Form 8900 (Rev. February 2020) of railroad track, rather than as a single line of railroad track. That is,
TIP because it has lines 1 through 5 available if needed. 1 mile of single track is 1 mile, but 1 mile of double track is 2 miles.
Qualifying railroad structure. Qualifying railroad structure is
Who Must File property located within the United States that includes, in part,
tunnels, bridges, and railroad track. For a complete description, see
Eligible taxpayers use Form 8900 to claim the railroad track Regulations section 1.45G-1(b)(4).
maintenance credit (RTMC) for qualified railroad track maintenance
expenditures (QRTME) paid or incurred during the tax year. If you Qualified railroad track maintenance expenditures (QRTME).
are an assignor of miles of eligible railroad track, you must file Form QRTME are expenditures (whether or not otherwise chargeable to a
8900 even if you do not claim any RTMC. See the instructions for capital account) for maintaining, repairing, and improving a
line 3b for the additional information that must be provided by qualifying railroad structure that is owned or leased as of January 1,
assignors. 2015, 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
Partnerships and S corporations must file this form to claim the by any amount of direct or indirect reimbursement to which you are
credit. All other taxpayers are not required to complete or file this entitled from a Class II or Class III railroad which made an
form if their only source for this credit is a partnership or S assignment of eligible railroad track to you.
corporation. Instead, they can report this credit directly on line 4g in
Part III of Form 3800, General Business Credit. Adjustments to Basis
Some or all of the QRTME paid or incurred by an eligible taxpayer
Definitions may be required to be capitalized as a tangible asset or an
Eligible taxpayers. Eligible taxpayers include the following. intangible asset, if applicable. See Regulations section 1.45G-1(e)
(1).
1. Any Class II or Class III railroad, as these terms are defined
by the Surface Transportation Board. Use the amount of RTMC to reduce the basis of a qualifying
2. Any person (including a Class I railroad (see below)) who railroad structure (including railroad track) asset or intangible asset,
transports property using the rail facilities of a Class II or Class III if applicable. The reduction is limited to the amount of QRTME
railroad. capitalized for the asset. For further details, see Regulations section
3. Any person (including a Class I railroad (see below)) who 1.45G-1(e)(2).
furnishes railroad-related services or property to a Class II or Class
III railroad. Member of Controlled Group or
For purposes of (2) or (3) above, the taxpayer is only eligible to Business Under Common Control
claim the credit for miles of eligible railroad track assigned to it by a For purposes of figuring the credit, all members of a “controlled
Class II or Class III railroad for purposes of the credit. See the group of corporations” and all members of a “group of businesses
instructions for line 3c. under common control” are treated as a single taxpayer. See

Feb 20, 2020 Cat. No. 66497D

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Regulations section 1.45G-1(f)(2) for a definition of these terms. As • The name and taxpayer identification number of each assignee.
a member, your credit is determined on a proportionate basis to your • The total number of miles of the assignor's eligible railroad track.
share of the aggregate QRTME taken into account by the group for • The number of miles of eligible railroad track assigned by the
the RTMC. Enter your share of the credit on line 5. Attach a assignor for the tax year to the assignee.
statement showing how your share of the credit was figured, and • The total number of miles of eligible railroad track assigned by the
write “See Attached” next to the entry space for line 5. assignor for the tax year to all assignees.

Line 3c
Specific Instructions See What's New, earlier, for a safe harbor rule that may
apply.
Line 1 CAUTION!
Qualified railroad track maintenance expenditures must be paid or The following information must be provided for the assignment in
incurred by an eligible taxpayer during the tax year. the form of a statement attached to the tax return for the tax year for
The payment by an eligible taxpayer, as an assignee, to a Class which the assignment is made.
II or Class III railroad, as an assignor, in exchange for an assignment • The total number of miles of eligible railroad track assigned to the
of miles of eligible railroad track for purposes of the credit assignee for the assignee's tax year.
computation is treated as QRTME paid or incurred by the assignee • Attestation that the assignee has in writing, and has retained as
and not the assignor. part of the assignee's records for purposes of Regulations section
1.6001-1(a), the following information from each assignor.
Line 3a 1. The name and taxpayer identification number of each
(This line only applies to you if you are a Class II or Class III assignor.
railroad.) 2. The effective date of each assignment (treated as being
Enter the number of eligible railroad track miles (see Eligible made by the assignor at the end of its tax year) to the assignee.
railroad track, earlier) owned or leased by you. 3. The number of miles of eligible railroad track assigned by
each assignor to the assignee for the tax year of the assignee.
Line 3b
(This line only applies to you if you are a Class II or Class III Notes
railroad.) The assignee cannot reassign miles.
•
See What's New, earlier, for a safe harbor rule that may • If the assignor, in its required statement (see the instructions for
! apply. line 3b above), assigns more miles than it has at the end of its tax
CAUTION year, the excess will be used to reduce each assignee's allocation in
You must reduce on line 3b the number of miles of eligible the same proportion as the assignee's original allocation of miles
railroad track entered on line 3a that you assigned to another eligible bears in relation to the total miles originally assigned.
taxpayer for purposes of the credit computation. You can only
assign each mile of railroad track once during your tax year. Each Line 6
mile of railroad track you assign is treated as being assigned on the Enter total qualified railroad track maintenance credits from:
last day of your tax year. • Schedule K-1 (Form 1065), Partner's Share of Income,
Deductions, Credits, etc., box 15 (code P); and
An assigned mile of eligible railroad track need not correspond to • Schedule K-1 (Form 1120-S), Shareholder's Share of Income,
any specific mile of eligible railroad track for which the eligible Deductions, Credits, etc., box 13 (code P).
taxpayer actually pays or incurs the QRTME. Further, an assignment
requires no transfer of legal title or other indicia of ownership of the Partnerships and S corporations report the above credits on
eligible railroad track, and need not specify the location of any line 6. All other filers figuring a separate credit on earlier lines also
assigned mile of eligible railroad track. However, the following report the above credits on line 6. All others not using earlier lines to
information must be provided for the assignment in the form of a figure a separate credit can report the above credits directly on Form
statement attached to the tax return for the tax year for which the 3800, Part III, line 4g.
assignment is made.

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.
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 and
business taxpayers filing this form is approved under OMB control number 1545-0074 and 1545-0123 and is included in the estimates shown
in the instructions for their individual and business 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 0 hr., 53 min.
Preparing and sending the form to the IRS 1 hr., 00 min.

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.

-2- Instructions for Form 8900 (Rev. 02-2020)

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