IRS Releases Guidance on Retroactive Biodiesel Tax Credit

Companies have 180 days to claim 2018-19 retroactive biodiesel tax credit beginning February 14.

January 20, 2020

WASHINGTON—The Internal Revenue Service released guidance for companies looking to claim the biodiesel and renewable diesel tax credit for 2018 and 2019.

The $1 per gallon tax credit expired January 1, 2018, and remained expired until Dec. 20, 2019, when President Trump signed spending legislation into law that included reinstatement of the incentive. As a result, the biodiesel tax credit was reinstated retroactively from its expiration Jan. 1, 2018, through Dec. 31, 2022.

Beginning February 14, 2020, companies can claim retroactive credits for 180 days. Claims received after August 11, 2020 will not be processed.

According to Biodiesel Magazine, companies are directed to submit claims for 2018 and 2019 biodiesel and alternative fuel incentives on Form 8849, Claim for Refund of Excise Taxes. All claims for both 2018 and 2019 should be submitted on a single form and should include a completed copy of the form Schedule 3: Certain Fuel Mixtures and the Alternative Fuel Credit.

The IRS is expected to pay claims within 60 days of filing. For more information, see the IRS guidance which was published on January 15, 2020.