IRS Explains Procedures for 2015 Biodiesel Tax Credits

January 21, 2016

The Internal Revenue Service (IRS) has released a guidance document outlining special one-time claim procedures for obtaining the $1.00 per gallon biodiesel blender tax credit for 2015. Notice 2016-05 prescribes rules for how taxpayers can claim one-time credits for selling or using biodiesel, renewable diesel, and other alternative fuels (such as natural gas) in 2016.  The notice also outlines how entities can offset liability for federal gasoline and/or diesel taxes with the 2015 credits, and further provides instructions for how taxpayers can make certain income tax claims on biodiesel and alternative fuels.

NATSO helped lead a coalition of stakeholders last year to convince Congress to reinstate the biodiesel tax credit retroactive to the beginning of 2015, and for all of 2016 as well. Domestic biodiesel producers had sought to convert the credit to a producer credit beginning in 2016, but Congress ultimately sided with NATSO and its coalition partners in favor of maintaining a blender credit. 
 
According to the IRS guidance, claims for 2015 biodiesel blender credits must be made on IRS Form 8849 (Claim for Refund of Excise Taxes) and IRS Form 8849 (Schedule 3) (Certain Fuel Mixtures and the Alternative Fuel Credit).  Taxpayers are to use a single Form 8849 and Form 8849 (Schedule 3) to claim all biodiesel volumes blended during calendar year 2015. (The IRS will not accept multiple claims for 2015 blends.) 
 
IRS Form 8849 is available here. The IRS is currently revising Form 8849 Schedule 3 and will be posted on the IRS Website in the near future. When it is available, it will be posted here.
 
Claims must be filed between Feb. 8, 2016, and Aug. 8, 2016. The IRS will not accept 2015 biodiesel blender credit claims filed after Aug. 8, 2016.
 
NATSO members are advised to review Notice 2016-05, and contact NATSO Regulatory Counsel David Fialkov (dfialkov@natso.com) with any questions.
David Fialkov's photo

David Fialkov

David Fialkov is the Vice President of Government Relations, as well as the Legislative and Regulatory Counsel, at NATSO. In this capacity, Mr. Fialkov directs NATSO's legislative, regulatory, and legal strategy on a range of issues, including transportation, energy and fuels, labor, data security, and taxes. Mr. Fialkov also oversees NATSO's political engagement program, including individualized legal and political counsel to member companies. Prior to joining NATSO, Mr. Fialkov was the senior associate in the Government Affairs and Public Policy practice at the law firm of Steptoe and Johnson in Washington, D.C. At Steptoe, Mr. Fialkov advised clients on legislative, regulatory, and political issues, as well as legal concerns. His primary clients included trade associations representing the motor fuel wholesale and retail industries, including the National Association of Convenience Stores and the Society of Independent Gasoline Marketers of America. Mr. Fialkov's focus was not only on the motor fuels business, but also the litany of other issues that retailers confront, including labor matters, foodservice issues, healthcare and employment issues, tax matters and data security. Prior to joining Steptoe, Mr. Fialkov graduated with honors from George Washington University Law School. He received his B.S. Summa cum laude with highest honors from Clark University in Worcester, MA. He lives in Washington, D.C. with his wife Allison and daughter Lilah. More
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