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 2nd Session of the 60th Legislature (2026)
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3 SENATE BILL 1992 By: Hall
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6 AS INTRODUCED
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7 An Act relating to income tax; amending Section 1,
7 Chapter 340, O.S.L. 2022, as amended by Section 1,
8 Chapter 164, O.S.L. 2024 (68 O.S. Supp. 2025, Section
8 2357.105), which relates to income tax credit for
9 qualified project expenditures; defining term;
9 requiring the Oklahoma Department of Commerce to
10 promulgate certain rules; and providing an effective
10 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. 2025, 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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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 ("Qualified Area"), or a project located
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5 adjacent to a terminal, switching, or Class II or III railroad as
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6 defined by the federal Surface Transportation Board;
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7 4. "Project sponsor" means a local economic development
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8 organization or authority, port authority, qualified industrial
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9 park, or a terminal, switching, or Class II or III railroad;
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10 5. "Project application" means an application submitted by a
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11 project sponsor on behalf of a qualifying project for an allocation
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12 of qualifying strategic industrial development enhancement (SIDE)
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13 tax credits. Project applications must include a description of the
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14 qualifying project, project location, detailed project costs, and a
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15 summary of expected economic benefits and job creation;
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16 6. "Qualified economic development expenditures" means
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17 expenditures for land improvements, building construction, building
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18 improvements and expansion, port terminal improvements, and the
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19 purchase of certain machinery and equipment;
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20 7. "Qualified initial infrastructure expenditures" means
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21 expenditures for new rail infrastructure and improvements, which
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22 includes the acquisition of right-of-way, engineering,
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23 rehabilitation of existing inactive track to reinstate operation,
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24 construction of new track such as industrial leads, switches, spurs,
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1 and sidings, loading dock improvements, and transloading structures
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2 involved with providing rail service to a qualifying project; and
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3 8. "Project tax credit amount" means the amount of tax credits
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4 allocated by Oklahoma Department of Commerce to a qualifying project
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5 for qualified economic development and initial infrastructure
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6 expenditures; and
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7 9. "Strategic finance partner" means any entity, regardless of
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8 legal form, that provides capital to a qualifying project. Capital
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9 contributions may include, but are not limited to, cash, loans,
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10 guarantees, other financial instruments, or services that support
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11 the eligible entity in the completion of a qualifying project. A
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12 strategic finance partner shall be subject to the Oklahoma corporate
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13 or individual income tax to qualify as a qualifying project
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14 affiliate.
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15 B. For tax years beginning after December 31, 2022, and ending
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16 not later than December 31, 2027, there shall be allowed a credit
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17 against the tax imposed pursuant to Section 2355 of this title in an
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18 amount not to exceed ten percent (10%) of an eligible entity's
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19 qualified economic development expenditures, subject to limitations,
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20 determination, and allocation by the Oklahoma Department of
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21 Commerce.
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22 C. The total project tax credit amount may not exceed ten
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23 percent (10%) of the qualified economic development expenditures,
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24 except for qualified initial infrastructure expenditures the project
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1 tax credit amount is earned at the rate of fifty percent (50%) of
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2 qualified initial infrastructure expenditures.
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3 D. 1. The project tax credit amount for qualified economic
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4 development expenditures may not exceed Six Million Dollars
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5 ($6,000,000.00) per qualifying project.
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6 2. The project tax credit amount for qualified initial
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7 infrastructure expenditures may not exceed Three Million Dollars
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8 ($3,000,000.00) per qualifying project.
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9 Projects are eligible to combine qualified economic development
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10 and qualified initial infrastructure expenditures, but the total
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11 project tax credit amount may not exceed Six Million Dollars
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12 ($6,000,000.00) per qualifying project in aggregate.
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13 E. The issuance of the project tax credit amount shall be
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14 subject to review of eligible expenditures and qualifying project
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15 status by the Oklahoma Department of Commerce.
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16 F. The credits authorized pursuant to this section may not be
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17 used to reduce the tax liability of the taxpayer to less than zero
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18 (0).
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19 G. The credits allowed pursuant to this section that are not
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20 used may be assigned to a qualifying project affiliate by written
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21 agreement at any time during the tax year in which the credit is
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22 earned or the five (5) years following the tax year the qualified
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23 expenditures are incurred. For purposes of this subsection, a
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24 "qualifying project affiliate" shall include a customer, vendor,
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1 project investor, or strategic finance partner of the eligible
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2 entity subject to the Oklahoma corporate or individual income tax.
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3 The eligible taxpayer and the qualifying project affiliate must
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4 jointly file a copy of the written assignment agreement with the
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5 Oklahoma Tax Commission within thirty (30) days of the assignment.
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6 The written agreement must contain the name, address, and taxpayer
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7 identification number of the parties to the assignment, the tax year
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8 the eligible taxpayer incurred the qualified expenditures, the
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9 amount of credit being assigned, and the tax year or years for which
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10 the credit may be claimed.
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11 H. To the extent not used, the tax credit authorized by this
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12 section may be carried over, in order, to each of the five (5)
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13 subsequent taxable years.
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14 I. Credits allocated by the Department shall not exceed Twelve
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15 Million Dollars ($12,000,000.00) in a tax year. Qualifying projects
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16 that have submitted an application and are not allocated all or part
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17 of credit for qualified economic development expenditures or
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18 qualified initial infrastructure expenditures shall be eligible for
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19 credit in subsequent tax years.
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20 J. 1. The Oklahoma Tax Commission may promulgate rules, forms,
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21 and regulations as are necessary to implement and administer the
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22 provisions of this section and certify the tax credit amount
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23 generated by each qualifying project annually.
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1 2. The Oklahoma Department of Commerce shall promulgate rules
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2 to permit verification of the eligibility of a qualifying project
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3 for the purpose of claiming the credit. The rules shall provide for
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4 the approval of qualified economic development expenditures prior to
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5 commencement of a project, provide for the approval of a strategic
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6 finance partner, and provide a certificate of verification upon
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7 completion of a project that uses qualified economic development
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8 expenditures. The certificate of verification shall satisfy all
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9 requirements of the Oklahoma Tax Commission pertaining to the
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10 eligibility of the eligible taxpayer claiming the credit.
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11 SECTION 2. This act shall become effective November 1, 2026.
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Req. No. 2825 Page 6Every fact on this page links to its source, starting with the official bill record.