Second Generation Biofuel Production Property Depreciation Allowance

NOTE: This incentive originally expired on December 31, 2016, but was retroactively extended through December 31, 2017, by Public Law 115-123.

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 before January 1, 2018, and produce fuel that meets 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 115-123, Public Law 114-113, and 26 U.S. Code 168)

Point of Contact
U.S. Internal Revenue Service
Phone: (800) 829-1040
http://www.irs.gov/