Second Generation Biofuel Production Property Depreciation Allowance

NOTE: This incentive was retroactively extended multiple times, most recently through December 31, 2016, by H.R. 2029.

An owner of a second generation biofuel production plant may be eligible for a 50% special depreciation allowance to recover the cost of qualified property. To be eligible, the plant must function solely for the purpose of second generation biofuel production, be put into service by the current owner after December 20, 2006, and before January 1, 2017, and fuel produced must meet the U.S. Environmental Protection Agency fuel and fuel additive registration requirements. Second generation biofuel is defined as liquid fuel produced from any lignocellulosic or hemicellulosic matter that is available on a renewable basis or any cultivated algae, cyanobacteria, or lemna. For more information about claiming the incentive, see IRS Form 4562, which is available on the IRS Forms and Publications website. (Reference Public Law 114-113 and 26 U.S. Code 168)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040

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