IRS Issues Guidance Information and Revised Forms for Biodiesel Tax Credit Claims

IRS Issues Guidance Information and Revised Forms for Biodiesel Tax Credit Claims

The Internal Revenue Service on Jan. 16 issued guidance for fuel retailers and blenders seeking to claim the biodiesel tax credit for years 2018 and 2019.

Fuel retailers who have purchased B100 and blended with transportation fuel and/or heating oil may now claim the $1.00 per gallon credit. Blenders have until Aug. 11, 2020, to file retroactive claims for 2018 and 2019. The credit is available through 2022. Claimants must have documentation to support their claim (Biodiesel Certificates) and claims made must represent gallons of B100 blended and sold.

President Trump on Dec. 20, 2019, signed legislation that retroactively renewed the $1 per-gallon biodiesel blenders tax credit and extended it through 2022. The renewal of the biodiesel tax credit marked an enormous victory for the travel center industry. NATSO led a coalition of stakeholders to educate lawmakers about the importance of the biodiesel tax credit and developed the strategic direction of this group that helped get the credit through Congress.

Companies that have been purchasing B99 are urged to contact NATSO’s Alternative Fuels Council to review any benefit-share agreements from the past two years. Dollars coming from suppliers under such agreements must be treated as taxable income.

Claims may be filed as early as Feb. 14, 2020, and claims made prior to this date will be deemed as submitted on Feb. 14.

Additionally, Congress renewed the Alternative Fuel Mixture tax credit retroactively for 2018 and 2019. This credit, however, was only extended for one additional year, or through Dec. 31, 2020. It offers 50 cents for every 1.353 gallons of propane used as a transportation fuel or approximately 37 cents per gallon.

The IRS is directing companies to submit both 2018 and 2019 claims on a single Form 8849 along with a completed Schedule 3: Certain Fuel Mixtures and the Alternative Fuel Credit. Claims may be submitted by postal mail to:

Internal Revenue Service
P.O. Box 312
Covington, KY 41012-0312

The Alternative Fuel Mixture claim will, once again, be claimed via form 720X, Amended Quarterly Federal Excise Tax Return.

The IRS is reminding claimants that the Alternative Fuel Mixture credit claims may not exceed the claimants 4081 liability incurred in that same given quarter for which the claim is being made.

Complete IRS Guidance (Notice 2020-8)

Form 8849: Claim for Refund of Excise Taxes

Schedule 3: Certain Fuel Mixtures and the Alternative Fuel Credit

NATSO members are encouraged to join us at the NATSO Connect event, scheduled to be held Feb 6-9, in Denver, Colorado, for a deeper discussion on the biodiesel tax credit and renewable identification numbers (RINs) and how to best manage these critical credits. On-hand will be Oscar L. Garza, Esq. to discuss the optimum methods of taking advantage of the BTC. Alternative Fuels Council Vice President Jeff Hove will shed light on the value of the RIN credits.

NATSO members with questions should contact Jeff Hove.

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