Barge and Rail Usage Tax Credit

The amount of the credit is $25 per 20-foot equivalent unit (TEU) or 16 tons of noncontainerized cargo or 1 unit of roll-on/roll-off cargo moved by barge or rail rather than trucks or other motor vehicles on the Commonwealth's highways. To receive this credit, an international trade facility (ITF) must apply to Virginia Tax. We cannot issue more than $500,000 in tax credits in any fiscal year. Virginia Tax will determine the allowable credit amount for the taxable year and provide a written certification of the credit amount to each taxpayer. Taxpayers can claim this credit against the individual income tax, the corporate income tax, the tax on trusts, the bank franchise tax, the insurance premiums tax, and the tax on public service corporations. Any unused tax credits may be carried over for 5 taxable years.

The ITF must apply by Apr. 1 using Form BRU. Submitting a late application will disqualify you for the credit. All applications must be sent to the Virginia Department of Taxation, Tax Credit Unit, P.O. Box 715, Richmond, VA 23218-0715. We will send a letter by June 30 to certify the credit. You must have this certification from the Tax Credit Unit to claim the Barge and Rail Usage credit on your tax return.

The amount of the credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company (LLC) must be allocated to the individual partners, shareholders, or members in proportion to their ownership or interest within the business entity using Form PTE within 30 days after the credit is granted.

Guidelines

Reference: Virginia Code 58.1-439.12:09

International Trade Facility Tax Credit

An income tax credit is allowed for either capital investment in an international trade facility (ITF) or increasing jobs related to an international trade facility. To qualify, an ITF must show at least a 10% increase in shipments through VPA ports in Virginia. The amount of the credit would be equal to $3,000 per new qualified full-time employee that results from increased qualified trade activities by the taxpayer or two percent of the amount of capital investment made by the taxpayer to facilitate the increased eligible trade activities. Any company that creates jobs or makes capital investments in a "tobacco-dependent locality" would be permitted to claim a port tax credit equal to $6,000 per job created or 4% of qualified capital investment expenses, to the extent that money is available in the Tobacco-Dependent Localities Fund. If the amount of credits allowable for companies in tobacco-dependent localities exceeds the amount deposited in the Fund, the credits would be allocated to taxpayers on a pro rata basis by Virginia Tax. Taxpayers can elect to claim either credit, but cannot claim both credits in the same taxable year.

A qualified company that claims employees for the Major Business Facility Job Tax Credit or the International Trade Facility Tax Credit cannot receive a Port of Virginia Economic and Infrastructure Development Zone Grant (POV Zone Grant) for those previously claimed jobs.

No more than $1.25 million in tax credits can be issued in any fiscal year. If the amount of tax credits requested exceeds $1.25 million, the credits would be allocated proportionately among all qualified taxpayers. Virginia Tax will determine the credit amount for the taxable year and provide a written certification to each taxpayer. The amount of the credit will be limited to 50% of the taxpayer's tax liability for the taxable year. Any unused credit amount can be carried forward for 10 years.

The business must apply by Apr. 1 using Form ITF. Submitting a late application will disqualify you for the credit. All applications must be sent to the Virginia Department of Taxation, Tax Credit Unit, P.O. Box 715, Richmond, VA 23218-0715. We will send a letter to certify this credit; you must have this certification to claim this credit on your tax return. 

The amount of the credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company (LLC) must be allocated to the individual partners, shareholders, or members in proportion to their ownership or interest within the business entity using Form PTE within 30 days after the credit is granted.

Guidelines

Reference: Virginia Code 58.1-439.12:06

Port Volume Increase Tax Credit

Allows an income tax credit to a qualifying taxpayer that is an agricultural entity, manufacturing-related entity (manufacturer or distributor of manufactured goods), or mineral and gas entity that uses port facilities in the Commonwealth and increases its port cargo volume by a minimum of 5% at these facilities for taxable year beginning Jan. 1, 2011 but before Jan. 1, 2017. Base year cargo volume must be at least 75 net tons of non-containerized cargo or ten 20-ft equivalent units (TEUs).

The CAP is $3.2 million. The taxpayer must apply to the Virginia Port Authority by March 1st of the calendar year after the calendar year in which the increase in port cargo volume occurs. Submitting a late application will disqualify you for the credit. If, on March 15 of each year, the cumulative amount of tax credits requested by qualifying taxpayers for the prior year exceeds $3.2 million, the credits will be prorated among the qualifying taxpayers who requested the credit. A qualifying taxpayer is generally not permitted to receive more than $250,000 each calendar year. However, if, on March 15 of each year, the $3.2 million credit amount is not fully allocated among qualifying taxpayers, those taxpayers who have already been allocated a credit for the prior year are allowed a pro rata share of the remaining credit amount. The Virginia Port Authority will issue the credit by May 30.

The amount of the credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company (LLC) must be allocated to the individual partners, shareholders, or members in proportion to their ownership or interest within the business entity using Form PTE within 30 days after the credit is granted.

Reference: Virginia Code 58.1-439.12:10