Biodiesel Mixture Excise Tax Credit
NOTE: This incentive originally expired on December 31, 2016, but was retroactively extended through December 31, 2017, by House Resolution 1892, 2018.
A biodiesel blender that is registered with the Internal Revenue Service (IRS) may be eligible for a tax incentive in the amount of $1.00 per gallon of pure biodiesel, agri-biodiesel, or renewable diesel blended with petroleum diesel to produce a mixture containing at least 0.1% diesel fuel. Only blenders that have produced and sold or used the qualified biodiesel mixture as a fuel in their trade or business are eligible for the tax credit. The incentive must first be taken as a credit against the blender's fuel tax liability; any excess over this tax liability may be claimed as a direct payment from the IRS. Claims must include a copy of the certificate from the registered biodiesel producer or importer that: identifies the product; specifies the product's biodiesel, agri-biodiesel, and/or renewable diesel content; confirms that the product is properly registered as a fuel with the U.S. Environmental Protection Agency; and confirms that the product meets the requirements of ASTM specification D6751. Renewable diesel is defined as liquid fuel derived from biomass that meets EPA's fuel registration requirements and ASTM specifications D975 or D396; the definition of renewable diesel does not include any fuel derived from co-processing biomass with a feedstock that is not biomass.
This tax credit is applicable to fuel blended through December 31, 2017. The U.S. Department of the Treasury (Treasury) will issue guidance for how to submit claims by March 11, 2018. Claims may be submitted for a 180-day period beginning no later than 30 days after Treasury issues guidance, and claims will be paid no later than 60 days after receipt. (Reference House Resolution 1892, 2018, Public Law 114-113, and 26 U.S. Code 6426)
Point of Contact
Excise Tax Branch
U.S. Internal Revenue Service Office of Chief Counsel
Phone: (202) 317-6855