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So how do I get the 50 cent/gallon tax credit?

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  • So how do I get the 50 cent/gallon tax credit?

    It looks like I should be registered as an alternative fuel user, which I haven't because nobody in our ginormous guvmint system knows what I'm talking about so they pass me to someone's voicemail that never calls back. I do have the excise tax form and found where I can enter gge's. There's also a 18 cent deduction, I think, leaving me 32 cents. The problem is, it's a quarterly form and I'm trying to file a years worth on it and....I'm pooched on the registration, don't know how to get it.

  • #2
    Re: So how do I get the 50 cent/gallon tax credit?

    32 cents per gge is a lot to leave on the table if you use a lot of fuel. The other edge of the blade is: when the 50 cent credit goes away , the feds will be wanting the 18 cent federal fuel tax reported and paid. The good thing about Idaho , no state fuel tax on CNG at this time http://tax.idaho.gov/p-motorfuels.cfm . Let's hope they keep it that way in Idaho.

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    • #3
      Re: So how do I get the 50 cent/gallon tax credit?

      Need to apply for alternative fuel tax number IRS form 637 takes about 3 months you will probably get interview and site visit from IRS auditor, you should also check with your state about state fuel taxes since they usually work together and one requires the other.
      If you are just home fueling your own car it might not be worth the effort (you might be opening a can of worms that you won't be able to close again)

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      • #4
        Re: So how do I get the 50 cent/gallon tax credit?

        Thanks guys. I don't think it's worth it for me.

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        • #5
          Re: So how do I get the 50 cent/gallon tax credit?

          Well it is a moot point as of now since the credit is expired... I discussed this issue with the IRS this past summer. I run LPG that this credit also applies to...

          In summary... You can take the credit if you apply for a alternative fueler (AF) (i.e. commercial business). The home fueling station would only apply for fuel used for business use but you would have to have a separate gas meter to determine how much fuel is used for heating vs transportation. So the fueling station could simply claim the credit and reduce your price at the pump. This is what I did with LPG. I did not qualify for AF since it was for personal use. The LPG company filed the credit and passed the savings on to me.

          Here is my detailed writeup.

          I discussed the alternative fuels with Ron Sass at (919) 850-1136. You will find his discussion on IRS Notice 2013-26 (http://www.irs.gov/irb/2013-18_IRB/ar08.html)

          In order to file for the $0.50/ LPG Gallon alternative fuel tax credit as discussed in IRS publication 510 (http://www.irs.gov/pub/irs-pdf/p510.pdf) you must apply for IRS form 637 and become an Alternative Fueler (“AL”). IRS publication 510 states…

          Registration Requirements: The following discussion applies to excise tax registration requirements for activities relating to fuels only. See Form 637 for other persons who must register and for more information about registration. Persons that are required to be registered.
          You are required to be registered if you are a:
          Blender,
          Enterer,
          Pipeline operator,
          Position holder,
          Refiner,
          Terminal operator,
          Vessel operator,
          Producer or importer of alcohol, biodiesel, agri-biodiesel, and renewable diesel, or
          Producer of cellulosic biofuel.
          Persons that may register. You may, but are not required to, register if you are a:
          Feedstock user,
          Industrial user,
          Throughputter that is not a position holder,
          Ultimate vendor,
          Diesel-water fuel emulsion producer,
          Credit card issuer, or
          Alternative fuel claimant.
          Ultimate vendors, credit card issuers, and alternative fuel claimants do not need to be registered to buy or sell fuel. However, they must be registered to file claims for certain sales and uses of fuel. See Form 637 for more information.”

          So you don’t have to register as a alternative fueler unless you plan to file for a tax credit. If you plan to file for the tax credit then you must go to IRS form 637 (http://www.irs.gov/pub/irs-pdf/f637.pdf).

          Form 637 is a filing that allows a business to become a registered alternative fueler.

          The instructions for form 637 states:
          How To Apply
          Complete Form 637 and submit it with the required additional information described on the chart on pages 2–4. You may use additional sheets for your explanations. Be sure to write your name and EIN on each sheet you attach. You must send all of the required information or the processing of your application will be delayed. The IRS will ask you for additional information if needed, or you may provide additional information at any time.
          The application must be reviewed and approved before you are registered for any activity. The review may include inspection of your premises during normal business hours without advance notice. If your application is approved, the IRS will issue a Letter of Registration. The letter will include the activities you are registered for, the effective date of the registration, and your registration number. A copy of Form 637 is not a Letter of Registration. If your application is denied, you will be notified in writing by the IRS that the application has been denied and the reason for the denial.

          For some small businesses, the owner of the business can simply use their social security number as their EIN (Employer Identification Number); however, according to the following a alternative fueler would need a EIN (http://www.irs.gov/Businesses/Small-...Need-an-EIN%3F)

          Do You Need an EIN?
          You will need an EIN if you answer "Yes" to any of the following questions. For your convenience, clicking on the "Yes" option will take you directly to How to apply for an EIN.
          Daily Limitation of an Employer Identification Number
          Effective May 21, 2012, to ensure fair and equitable treatment for all taxpayers, the Internal Revenue Service will limit Employer Identification Number (EIN) issuance to one per responsible party per day. This limitation is applicable to all requests for EINs whether online or by phone, fax or mail. We apologize for any inconvenience this may cause.
          Do you have employees?
          YES
          NO
          Do you operate your business as a corporation or a partnership?
          YES
          NO
          Do you file any of these tax returns: Employment, Excise, or Alcohol, Tobacco and Firearms?
          YES
          NO
          Do you withhold taxes on income, other than wages, paid to a non-resident alien?
          YES
          NO
          Do you have a Keogh plan?
          YES
          NO
          Are you involved with any of the following types of organizations?
          · Trusts, except certain grantor-owned revocable trusts, IRAs, Exempt Organization Business Income Tax Returns
          · Estates
          · Real estate mortgage investment conduits
          · Non-profit organizations
          · Farmers' cooperatives
          · Plan administrators
          YES
          NO


          Because you are filing the quarterly form 720 to pay your $18.3/LPG gallon excise tax, you will also need to apply for a EIN in order to register on form 637. You need a business to file a EIN.

          The quarterly form 720 (http://www.irs.gov/pub/irs-pdf/f720.pdf) is the form that a user of alternative fuels pays their $0.183/ LPG gallon of LPG used as transportation fuel. The part one is where the taxes are claimed of the $0.183/ gallon and part 4, schedule C is where the $0.50 / gallon credit is claimed. The instructions to form 720 (http://www.irs.gov/pub/irs-pdf/i720.pdf) states:
          Claimant.
          For the alternative fuel credit, the registered alternative fueler who (1) sold an alternative fuel at retail and delivered it into the fuel supply tank of a motor vehicle or motorboat, (2) sold an alternative fuel, delivered it in bulk for taxable use in a motor vehicle or motorboat, and received the required statement from the buyer, (3) used an alternative fuel (not sold at retail or in bulk as previously described) in a motor vehicle or motorboat, or (4) sold an alternative fuel for use as a fuel in aviation is the only person eligible to make this claim.

          Therefore only the registered alternative fueler can claim the $0.50/LPG gallon credit. This registered fueler would be the propane company for any individual user like myself. For other small business and farm customers of the propane company, the customer can file as a alternative fueler for the fuels either sold or consumed in the business. A individual like myself cannot claim the credit.

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          • #6
            Re: So how do I get the 50 cent/gallon tax credit?

            lot of info. !! so some one who works at Q-mart and has a fuelmaker and now and then gets cng from a statoin can not get the credit ? do i have it right ??? sound like a big mess to get it !!! thank you chuck

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            • #7
              Re: So how do I get the 50 cent/gallon tax credit?

              So I just got my fuelmaker used. [3000] PSI. Yesterday I picked up a CNG biuel 2003 chev express van with 140. Got 17 mpg on the highway!! Im a HVAC contractor so will figure I will save easily 250-300 month!! my regular truck is 100 bucks a week habit. Seems lots of paperwork to get any rebate. Ill get mine
              in DOLLARS saved...I have an aux meter to measure my transportation gas before it goes into the compressor.

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              • #8
                Re: So how do I get the 50 cent/gallon tax credit?

                Originally posted by fixitguy View Post
                So I just got my fuelmaker used. [3000] PSI. Yesterday I picked up a CNG biuel 2003 chev express van with 140. Got 17 mpg on the highway!! Im a HVAC contractor so will figure I will save easily 250-300 month!! my regular truck is 100 bucks a week habit. Seems lots of paperwork to get any rebate. Ill get mine
                in DOLLARS saved...I have an aux meter to measure my transportation gas before it goes into the compressor.
                That tax credit expired on 12/31/2013. This is a moot point now, with the exception that the credit may be reinstated in the future and made retroactive (doubtful but possible).

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                • #9
                  Re: So how do I get the 50 cent/gallon tax credit?

                  is this tax credit (50 cent per gallon) still expired or was it renewed? if it has been renewed, is it available for me if I purchased a used civic gx. I was looking at a used civic gx online and the dealer mentioned that I can get a 50 cent per gallon federal tax credit if I purchase it. are there other federal tax credits available if I purchase a used civic gx? and if this tax credit (50 cent per gallon) is still available, how do I use it? I am self employed (file taxes as a sole proprietor) and the vehicle would be used strictly for my business. I had no plans on purchasing a home refueling unit (unless that was required to get the 50 cent a gallon tax credit).

                  all comments are much appreciated.

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                  • #10
                    Re: So how do I get the 50 cent/gallon tax credit?

                    The 50 cent per gasoline gallon equivalent (GGE) tax credit expired Dec 31, 2014. There can be no assurance Congress will again extend it, has it has since the original credit expired on Dec 31, 2010. To obtain the credit you have to register as a commercial fuel provider with the IRS, remit 18.3 cents per GGE in fuel excise taxes, remit the applicable __ cents per GGE to your state government for excise fuel taxes, and then (if it comes back again) apply for the 50 cent excise fuel tax credit.

                    For a list of all the alternative fuel incentives, please visit this DOE web site:
                    http://www.afdc.energy.gov/

                    (click on "laws and incentives")

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