Shown verbatim: the complete text as captured from the official PDF posted by the Oklahoma Legislature, fetched 2026-07-23. Page and line markers are part of the official record; nothing is edited or removed. The official bill page.
1 STATE OF OKLAHOMA
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2 1st Session of the 60th Legislature (2025)
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3 SENATE BILL 1117 By: Stewart
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6 AS INTRODUCED
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7 An Act relating to income tax credit; amending
7 Section 1, Chapter 340, O.S.L. 2022, as amended by
8 Section 1, Chapter 164, O.S.L. 2024 (68 O.S. Supp.
8 2024, Section 2357.105), which relates to credit for
9 qualified economic development and infrastructure
9 expenditures; modifying definition; and providing an
10 effective date.
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13 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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14 SECTION 1. AMENDATORY Section 1, Chapter 340, O.S.L.
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15 2022, as amended by Section 1, Chapter 164, O.S.L. 2024 (68 O.S.
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16 Supp. 2024, Section 2357.105), is amended to read as follows:
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17 Section 2357.105. A. As used in this section:
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18 1. "Eligible entity" means an entity incorporated and located
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19 in the state with a qualifying project in a qualifying project
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20 location;
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21 2. "Qualifying project" means the new construction or expansion
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22 of an eligible entity or the development of qualified initial
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23 infrastructure to serve an eligible entity in a qualifying project
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24 location;
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Req. No. 1142 Page 1
1 3. "Qualifying project location" means a project located in an
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2 industrial park, economic development zone, or port located within a
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3 county in this state with a population of less than one hundred
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4 thousand (100,000) persons according to the latest Federal Decennial
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5 Census for expenditures made prior to tax year 2026, and four
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6 hundred thousand (400,000) persons according to the latest Federal
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7 Decennial Census for expenditures made in tax year 2026 and
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8 subsequent tax years ("Qualified Area"), or a project located
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9 adjacent to a terminal, switching, or Class II or III railroad as
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10 defined by the federal Surface Transportation Board;
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11 4. "Project sponsor" means a local economic development
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12 organization or authority, port authority, qualified industrial
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13 park, or a terminal, switching, or Class II or III railroad;
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14 5. "Project application" means an application submitted by a
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15 project sponsor on behalf of a qualifying project for an allocation
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16 of qualifying strategic industrial development enhancement (SIDE)
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17 tax credits. Project applications must include a description of the
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18 qualifying project, project location, detailed project costs, and a
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19 summary of expected economic benefits and job creation;
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20 6. "Qualified economic development expenditures" means
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21 expenditures for land improvements, building construction, building
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22 improvements and expansion, port terminal improvements, and the
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23 purchase of certain machinery and equipment;
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1 7. "Qualified initial infrastructure expenditures" means
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2 expenditures for new rail infrastructure and improvements, which
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3 includes the acquisition of right-of-way, engineering,
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4 rehabilitation of existing inactive track to reinstate operation,
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5 construction of new track such as industrial leads, switches, spurs,
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6 and sidings, loading dock improvements, and transloading structures
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7 involved with providing rail service to a qualifying project; and
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8 8. "Project tax credit amount" means the amount of tax credits
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9 allocated by Oklahoma Department of Commerce to a qualifying project
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10 for qualified economic development and initial infrastructure
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11 expenditures.
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12 B. For tax years beginning after December 31, 2022, and ending
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13 not later than December 31, 2027, there shall be allowed a credit
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14 against the tax imposed pursuant to Section 2355 of this title in an
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15 amount not to exceed ten percent (10%) of an eligible entity's
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16 qualified economic development expenditures, subject to limitations,
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17 determination, and allocation by the Oklahoma Department of
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18 Commerce.
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19 C. The total project tax credit amount may not exceed ten
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20 percent (10%) of the qualified economic development expenditures,
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21 except for qualified initial infrastructure expenditures the project
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22 tax credit amount is earned at the rate of fifty percent (50%) of
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23 qualified initial infrastructure expenditures.
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1 D. 1. The project tax credit amount for qualified economic
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2 development expenditures may not exceed Six Million Dollars
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3 ($6,000,000.00) per qualifying project.
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4 2. The project tax credit amount for qualified initial
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5 infrastructure expenditures may not exceed Three Million Dollars
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6 ($3,000,000.00) per qualifying project.
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7 Projects are eligible to combine qualified economic development
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8 and qualified initial infrastructure expenditures, but the total
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9 project tax credit amount may not exceed Six Million Dollars
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10 ($6,000,000.00) per qualifying project in aggregate.
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11 E. The issuance of the project tax credit amount shall be
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12 subject to review of eligible expenditures and qualifying project
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13 status by the Oklahoma Department of Commerce.
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14 F. The credits authorized pursuant to this section may not be
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15 used to reduce the tax liability of the taxpayer to less than zero
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16 (0).
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17 G. The credits allowed pursuant to this section that are not
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18 used may be assigned to a qualifying project affiliate by written
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19 agreement at any time during the tax year in which the credit is
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20 earned or the five (5) years following the tax year the qualified
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21 expenditures are incurred. For purposes of this subsection, a
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22 "qualifying project affiliate" shall include a customer, vendor,
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23 project investor, or strategic finance partner of the eligible
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24 entity subject to the Oklahoma corporate or individual income tax.
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1 The eligible taxpayer and the qualifying project affiliate must
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2 jointly file a copy of the written assignment agreement with the
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3 Oklahoma Tax Commission within thirty (30) days of the assignment.
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4 The written agreement must contain the name, address, and taxpayer
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5 identification number of the parties to the assignment, the tax year
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6 the eligible taxpayer incurred the qualified expenditures, the
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7 amount of credit being assigned, and the tax year or years for which
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8 the credit may be claimed.
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9 H. To the extent not used, the tax credit authorized by this
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10 section may be carried over, in order, to each of the five (5)
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11 subsequent taxable years.
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12 I. Credits allocated by the Department shall not exceed Twelve
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13 Million Dollars ($12,000,000.00) in a tax year. Qualifying projects
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14 that have submitted an application and are not allocated all or part
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15 of credit for qualified economic development expenditures or
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16 qualified initial infrastructure expenditures shall be eligible for
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17 credit in subsequent tax years.
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18 J. 1. The Oklahoma Tax Commission may promulgate rules, forms,
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19 and regulations as are necessary to implement and administer the
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20 provisions of this section and certify the tax credit amount
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21 generated by each qualifying project annually.
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22 2. The Oklahoma Department of Commerce shall promulgate rules
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23 to permit verification of the eligibility of a qualifying project
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24 for the purpose of claiming the credit. The rules shall provide for
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Req. No. 1142 Page 5
1 the approval of qualified economic development expenditures prior to
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2 commencement of a project and provide a certificate of verification
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3 upon completion of a project that uses qualified economic
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4 development expenditures. The certificate of verification shall
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5 satisfy all requirements of the Oklahoma Tax Commission pertaining
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6 to the eligibility of the eligible taxpayer claiming the credit.
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7 SECTION 2. This act shall become effective November 1, 2025.
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9 60-1-1142 QD 1/16/2025 3:48:27 PM
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Req. No. 1142 Page 6Every fact on this page links to its source, starting with the official bill record.