me not being a tax atty or an atty in general
the fed tax crdeits for bio are simliar to what you get for renewable sources and hybrids, becuase your limiting the import oil use, etc
HOWEVER
it does not negate the fact you must pay road use taxes if its used in an on road vehicle.
if he or anyone else delivers it to you in bulk for your farm or whatever, I am sure its up to you to pay uncle and all state taxes that are applicable to on-road fuels if it goes in your ON road vehicle
if it stays in an OFF road vehicle the taxation is dimished significantly but not removed entirely.
this is buried in the IRS site
if the fed really wanted to help get the bio and straight grown fuel market going, they would cut taxes significantly on the fuels, but then the road use taxes left over wouldnt pay for bridges or the wonderful roads in LA or MS.
the big tax credit for bio burning engines should be established like it was for those of us whom purchased oil burners a few years back and got a ONE TIME tax credit
its coming but i would geuss not for a while, the stigma of bio fuels is going to be slow at winning the public, mainly because of the ethanol disaster during the carter years...... leaks, gas going bad, pre-ignition, not stopping engines etc. even though bio D is not the same it still falls into that public memeory of BAD
plus all the folks that run around trying to sell you NEW type O-rings that work with bio???????
and at 2.55 a gallon, its not much of an incentive........
from the IRS summary
The American Jobs Creation Act of 2004 (the Act), Public Law 108-357, made changes affecting fuel tax credits and refunds. The following is a brief review of some of these changes.
The credits and refunds for the nontaxable use of gasohol and, generally, the use of gasoline taxed at the full rate to produce gasohol have been eliminated.
Credit for Alcohol Fuel Mixtures and Biodiesel (Including Agri-biodiesel) Mixtures. The Act allows two new credits against any fuel tax liability reported on Form 720:
The alcohol fuel mixture credit is 51 cents per gallon of ethanol (60 cents per gallon for alcohol other than ethanol).
The biodiesel mixture credit is 50 cents per gallon of biodiesel ($1.00 per gallon of agri-biodiesel).
Producers and importers must first take the alcohol fuel mixture credit and biodiesel mixture credit on Schedule C (Form 720) against any fuel tax liability. A payment is allowed for any excess credit and may be taken as a credit on Schedule C (Form 720), as a refund on Schedule 3 (Form 8849), or as an income tax credit on Forms 4136, 6478, or 8864 as applicable. Only one claim may be made for any particular amount of alcohol or biodiesel.
Persons who blend alcohol with gasoline, diesel fuel, or kerosene to produce an alcohol fuel mixture outside the bulk transfer terminal system must pay must pay the gasoline tax on the volume of alcohol in the mixture. See Form 720 to report this tax. You also must be registered with the IRS as a blender. See Form 637.
Persons who blend biodiesel with undyed diesel fuel to produce a biodiesel mixture outside the bulk transfer terminal system must pay the diesel fuel tax on the volume of biodiesel in the mixture. See Form 720 to report this tax. You also must be registered with the IRS as a blender. See
Form 637.
Producers and importers of straight alcohol or straight biodiesel must be registered with the IRS. See Form 637.
Biodiesel mixture credit. You can take the credit for biodiesel you use to produce a qualified mixture. A qualified mixture is a mixture of biodiesel with diesel fuel without regard to kerosene.
You can take the credit only for a mixture you produce. You must sell the mixture to any person for use as a fuel, or use it as a fuel in your trade or business. Take into account biodiesel you use to produce a qualified mixture only if the sale or use is in your trade or business.
You cannot take a credit for the casual off-farm production of a qualified biodiesel mixture.
Biodiesel. Biodiesel means the monoalkyl esters of long chain fatty acids derived from plant or animal matter which meet the registration requirements for fuels and fuel additives established by the Environmental Protection Agency (EPA) under section 211 of the Clean Air Act, and the requirements of the American Society of Testing Materials D6751.
Agri-biodiesel. Agri-biodiesel means biodiesel derived solely from virgin oils, including esters derived from virgin vegetable oils from corn, soybeans, sunflower seeds, cottonseeds, canola, crambe, rapeseeds, safflowers, flaxseeds, rice bran, and mustard seeds, and from animal fats.
Certification. You must obtain and keep as part of your records a certification to you from the producer or importer of the biodiesel. The certificate is required for any biodiesel fuel credit claimed. The certificate must identify the product produced and the percentage of biodiesel and agri-biodiesel in the product. If the producer or importer of the biodiesel is also the taxpayer claiming the biodiesel credit, the certificate is required. See Model Certificate F on page 20.
Separation or failure to use as fuel. If the credit applied to biodiesel used in the production of a qualified mixture, and you later separate the biodiesel from the mixture or do not use the mixture as fuel, you must pay a tax equal to the credit. Report this tax on Form 720.
Diesel fuel tax on the biodiesel in a biodiesel fuel mixture. Persons who blend biodiesel with undyed diesel fuel to produce a biodiesel mixture outside the bulk transfer terminal system must pay the diesel fuel tax on the volume of biodiesel in the mixture. See Form 720 to report this tax. You also must be registered with the IRS as a blender. See Form 637.
and for all you folks with propane injectoin, you better pay some taxes
See Publication 510 if you use propane or other special fuels in registered highway vehicles. If you do, you may be liable for tax on this use.
