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Federal Tax Credit on Propane Products
Alternative Fuel Excise Tax Credit 2016
The Alternative Fuel Tax Credit has been extended most recently through December 31, 2016. This tax incentive applies to propane that is used as a fuel to operate motor vehicles including forklifts. The tax credit of %.50 per gallon is available for propane used between January 1, 2015 and December 31, 2016. More information is available at Alternative Fuels Data Center including tax incentives by state. For more information about your eligibility under the latest extension please contact us.
Update : Year End Deal Set to Extend Alternative Fuel Tax Credit
In December, the National Propane Gas Association (NPGA) announced that a deal had been reached to extend the Alternative Fuel Tax Credit for two years. Currently the rate is $0.50 a gallon but will likely be adjusted to $0.36 beginning January 1, 2016, depending on fuel sales. The bill, named the Omnibus and Tax Extenders deal, is still in process but enactment into law is “virtually certain”, according to NPGA. Return here for more updates. Energy tax credit is just one of the many advantages of propane.
2014 Propane Tax Credit
Fueling your forklifts with versatile, clean-burning propane? This fuel is used by nearly 60% of the commercial and industrial buildings in the U.S. as an inexpensive and efficient fuel. Recently, the tax credit associated with the fuel was extended to provide an incentive to continue the use of propane. This Alternative Fuel Tax Credit includes a credit of 50 cents per gallon for all propane used in forklifts. The credit is available for each gallon of propane used to power a motor vehicle, which includes a forklift.
Please consult with individual tax advisors or a certified accountant for further advice.
2012-2013 Propane Tax CreditsThere's now another economic incentive to use propane: New "Fiscal Cliff" legislation, recently enacted by President Obama, includes an Alternative Fuel Tax Credit of 50 cents per gallon for all propane used in forklifts. The credit is available for each gallon of propane used to power a motor vehicle, which includes a forklift.
This energy tax credit first expired at the end of 2011. However, this propane-specific energy tax credit has been extended through December 31, 2013 and has also been made retroactive for taxable year 2012.If necessary, refer to several of the Internal Revenue Service tax forms and instructions:
2010 Tax Credit Deadline UpdateMark your calendars that the deadline for the Propane Fuel Tax credit for 2010 propane usage for forklifts is August 1, 2011. This credit allows owners of manufacturing, distribution and warehousing facilities to apply for the credit for $0.50 per gallon of propane used to power forklifts during the 2010 operating year. According to Propane Education & Research Council (PERC), this would be the end of the IRS allowed 180-day grace period to submit all retroactive fuel tax credits.
The IRS warns that these claims can only be filed one time, and before it can be claimed, owners must register with the IRS and follow all noted documentation requirements. View more information on the propane fuel tax credit here, or verify up to date tax information on the IRS website here.
2010-2011 Propane Tax CreditsOn December 17th 2010, President Obama signed the Tax Relief, Unemployment Insurance Authorization, and Job Creation Act of 2010. This legislation contains many favorable provisions that apply to both individuals and businesses within the propane industry including:
If you have ever been considering making the switch to propane, now is the time! Read more about the advantages of propane to learn how you can save money and make your operations a little greener. Already using propane for your forklifts? Check out our that will save your employees time and make your facilities safer.
2008-2009 Tax Credit ExtensionsOn February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009 into law that contained several positive provisions for propane. On October 3, 2008, former President George W. Bush signed the omnibus financial rescue package that contained three other high priority propane tax credit extensions. Below are the highlights of each. A detailed description of each provision is included in our latest advocacy piece available for download here.
In providing further guidance regarding the legislation, the Internal Revenue Service (IRS) made clear that forklifts fit the definition of an off-highway business motor vehicle and hence fuel used in a forklift is eligible for the 50 cent/gallon credit. Moreover, the IRS indicated that in this instance it is the end user, namely the forklift operator, who is entitled to apply for the credit, not the propane marketer. Therefore, forklift operators should be aware that the fuel they use for forklift operation will be eligible for a 50 cent/gallon credit assuming they take appropriate steps to properly register with the IRS.
As a first step, forklift operators need to file Form 637 with the IRS in order to be registered as an “Alternative Fueler.” IRS will then issue a registration number identifying the forklift operator as an Alternative Fueler. After receiving a registration number, the forklift operator can file a claim for the credit at the end of the year by filing Form 4136. If the alternative fuel excise tax credit exceeds the excise tax liability, the forklift operator may be able to claim an alternative fuel income tax credit (or refund) under certain circumstances.
This discussion is for information purposes. The discussion is not intended, and cannot be relied upon, as tax advice. We urge forklift operators to consult their own tax advisers regarding claims for credits or refunds. Relevant IRS forms may be viewed and downloaded from the IRS website by clicking here.