Tuesday, June 21, 2011

Fuel Tax Credit

We are in corporate tax season. I was thinking about a somewhat offbeat tax credit that we claim for one of our business clients. They work primarily with roadways and infrastructure. They have to power their equipment on-site, which means that many times they have to bring their own generators. They claim the fuel tax credit.

For a fuel-intensive business, this can add up. The credit for gasoline is 18.3 cents per gallon, and for diesel it is 24.3 cents. You are to keep certain records to support the credit, as can be expected. The records should include the name and address of the seller, the dates and quantity of purchase. Also, if there are different fuels - such as both gasoline and diesel – the records should differentiate between the two.

The credit is claimed on Form 4136. If the claim exceeds $750, the taxpayer can expedite the refund by filing Form 8849.

By the way, recreational use of a boat does not count for purposes of this credit.

You may want to check your state also. There may be an additional refund opportunity there.

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