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H&r Blaock

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H&r Blaock

H&r blaock 2. H&r blaock   Fuel Tax Credits and Refunds Table of Contents Gasoline and Aviation Gasoline Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation)Sales by Registered Ultimate Vendors Diesel-Water Fuel Emulsion Kerosene for Use in AviationSales by Registered Ultimate Vendors Other Fuels (Including Alternative Fuels) Refunds of Second TaxOptional reporting. H&r blaock Providing information. H&r blaock Definitions of Nontaxable UsesCustom application of fertilizer and pesticide. H&r blaock Fuel used between airfield and farm. H&r blaock Fuel not used for farming. H&r blaock Vehicles not considered highway vehicles. H&r blaock Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture CreditHow to Claim the Credit Filing Claims Claiming A Refund Claiming a Credit on Form 4136 Including the Credit or Refund in Income Federal excise taxes are imposed on certain fuels as discussed in chapter 1. H&r blaock This chapter lists the nontaxable uses of each fuel and defines the nontaxable uses. H&r blaock Information on the refund of second tax is included. H&r blaock This chapter also explains credits and refunds for the biodiesel or renewable diesel mixture credits, and the alternative fuel mixture and alternative fuel credits. H&r blaock Information on how to make a claim for credit or refund is included in this chapter and in the instructions for: Form 720, Form 4136, and Form 8849. H&r blaock Exported taxable fuel. H&r blaock   The claim rates for exported taxable fuel are listed on Schedule C (Form 720), Schedule 1 (Form 8849), and Form 4136. H&r blaock Taxpayers making a claim for exported taxable fuel must include with their records proof of exportation. H&r blaock Proof of exportation includes: A copy of the export bill of lading issued by the delivering carrier, A certificate by the agent or representative of the export carrier showing actual exportation of the fuel, A certificate of lading signed by a customs officer of the foreign country to which the fuel is exported, or A statement of the foreign consignee showing receipt of the fuel. H&r blaock Gasoline and Aviation Gasoline Ultimate Purchasers. H&r blaock   The following are the uses of gasoline (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. H&r blaock On a farm for farming purposes (credit only). H&r blaock Off-highway business use. H&r blaock Export. H&r blaock In a boat engaged in commercial fishing. H&r blaock In certain intercity and local buses. H&r blaock In a school bus. H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock In a highway vehicle owned by the United States that is not used on a highway. H&r blaock Exclusive use by a nonprofit educational organization (see Sales by registered ultimate vendors and Credit Card Purchases, later). H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit Card Purchases, later). H&r blaock In an aircraft or vehicle owned by an aircraft museum. H&r blaock   The following are the uses of aviation gasoline for which a credit or refund may be allowable to an ultimate purchaser. H&r blaock On a farm for farming purposes (credit only). H&r blaock Export. H&r blaock In foreign trade. H&r blaock Certain helicopter and fixed-wing air ambulance uses. H&r blaock In commercial aviation (other than foreign trade). H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock Exclusive use by a nonprofit education organization (see Sales by registered ultimate vendors and Credit card purchases, later). H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit and purchases, later). H&r blaock In an aircraft owned by an aircraft museum. H&r blaock In military aircraft. H&r blaock Claims by persons who paid the tax to the government. H&r blaock   Except for sales to nonprofit educational organizations and states and local governments, a credit or refund is allowable to the person that paid the tax to the government if the gasoline was sold to the ultimate purchaser (including an exporter) by either that person or by a retailer and the fuel was exported; used or sold for use as supplies for vessels or aircraft, including military aircraft, commercial fishing, and foreign trade; sold to a qualified blood collector organization; or used or sold for use in the production of Other Fuels. H&r blaock See Filing Claims, later. H&r blaock Sales by registered ultimate vendors. H&r blaock   This is an ultimate vendor that sells gasoline or aviation gasoline to any of the following and that is purchased without the use of a credit card. H&r blaock A state or local government for its exclusive use (including essential government use by an Indian tribal government). H&r blaock A nonprofit educational organization for its exclusive use. H&r blaock   The registered ultimate vendor may make the claim if the ultimate purchaser did not use a credit card and waives its right to the credit or refund by providing the registered ultimate vendor with a certificate. H&r blaock A sample certificate is included as Model Certificate M in the Appendix. H&r blaock The registered ultimate vendor must have the certificate at the time the credit or refund is claimed. H&r blaock   The ultimate vendor must be registered by the IRS. H&r blaock See Registration Requirements, earlier. H&r blaock Credit card purchases. H&r blaock   If gasoline and aviation gasoline are purchased with a credit card issued to a state or local government for its exclusive use (including essential government use by an Indian tribal government), or a nonprofit educational organization for its exclusive use, the person who extended credit to the ultimate purchaser (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the gasoline or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. H&r blaock   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. H&r blaock How to make the claim. H&r blaock   If the claim is made by the credit card issuer, see Schedule C  (Form 720) or Schedule 8 (Form 8849). H&r blaock Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation) For conditions to an allowance of a credit or refund on exported dyed diesel fuel and dyed kerosene, see Exported taxable fuel, earlier. H&r blaock Ultimate purchasers. H&r blaock   The following are nontaxable uses of diesel fuel and kerosene (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. H&r blaock On a farm for farming purposes. H&r blaock Off-highway business use. H&r blaock Export. H&r blaock In a qualified local bus. H&r blaock In a school bus. H&r blaock Other than as a fuel in a propulsion engine of a diesel-powered highway vehicle (such as home heating oil). H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock In a highway vehicle owned by the United States that is not used on a highway. H&r blaock Exclusive use by a nonprofit educational organization (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). H&r blaock In a vehicle owned by an aircraft museum. H&r blaock As a fuel in a propulsion engine of a diesel-powered train. H&r blaock Sales by Registered Ultimate Vendors The following are the sales for which a credit or refund may be allowable to the registered ultimate vendor only. H&r blaock Undyed diesel fuel or undyed kerosene sold for the exclusive use by a state or local government (if credit card rules (defined later) do not apply), Undyed kerosene sold from a blocked pump (defined below), or Undyed diesel fuel or undyed kerosene used in certain intercity and local buses, only if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. H&r blaock Registered ultimate vendor (state use). H&r blaock   This is a person that sells undyed diesel fuel or undyed kerosene to a state or local government for its exclusive use (including essential government use by an Indian tribal government). H&r blaock The diesel fuel or kerosene must be purchased by the state without the use of a credit card, issued to the state by the credit card issuer, in order for the ultimate vendor to make the claim. H&r blaock The ultimate vendor must be registered by the IRS. H&r blaock See Registration Requirements, earlier. H&r blaock Registered ultimate vendor (blocked pump). H&r blaock   This is an ultimate vendor that sells undyed kerosene from a blocked pump. H&r blaock   A credit or refund may be allowable to a registered ultimate vendor (blocked pump) if the vendor sold to a buyer undyed kerosene from a blocked pump for use other than as a fuel in a diesel-powered highway vehicle and the vendor had no reason to believe the kerosene would not be used in that manner. H&r blaock Blocked pump. H&r blaock   A blocked pump is a fuel pump that meets all the following requirements. H&r blaock It is used to make retail sales of undyed kerosene for use by the buyer in any nontaxable use. H&r blaock It is at a fixed location. H&r blaock It is identified with a legible and conspicuous notice stating, “UNDYED UNTAXED KEROSENE, NONTAXABLE USE ONLY. H&r blaock ” It meets either of the following conditions. H&r blaock It cannot reasonably be used to dispense fuel directly into the fuel supply tank of a diesel-powered highway vehicle or train. H&r blaock It is locked by the vendor after each sale and unlocked by the vendor only in response to a buyer's request for undyed kerosene for use other than as a fuel in a diesel-powered highway vehicle or train. H&r blaock Registered ultimate vendor (certain intercity and local buses). H&r blaock   This is an ultimate vendor that sells undyed diesel fuel or undyed kerosene to the ultimate purchaser for use in certain intercity and local buses. H&r blaock   The registered ultimate vendor may make the claim if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. H&r blaock A sample waiver is included as Model Waiver N in the Appendix. H&r blaock The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. H&r blaock Credit Card Purchases. H&r blaock   If undyed diesel fuel or kerosene is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the diesel fuel or kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. H&r blaock   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. H&r blaock Diesel-Water Fuel Emulsion A claim for credit or refund may be made for the nontaxable use of a diesel-water fuel emulsion and for undyed diesel fuel used to produce a diesel-water fuel emulsion. H&r blaock The claim rate for nontaxable use of a diesel-water fuel emulsion taxed at $. H&r blaock 198 per gallon is $. H&r blaock 197 (if exported, the claim rate is $. H&r blaock 198). H&r blaock The following are the nontaxable uses for a diesel-water fuel emulsion for which a credit or refund may be allowable to an ultimate purchaser. H&r blaock On a farm for farming purposes. H&r blaock Off-highway business use. H&r blaock Export. H&r blaock In a qualified local bus. H&r blaock In a school bus. H&r blaock Other than as fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway use). H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock In a highway vehicle owned by the United States that is not used on a highway. H&r blaock Exclusive use by a nonprofit educational organization. H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia. H&r blaock In an aircraft or vehicle owned by an aircraft museum. H&r blaock Blender claims. H&r blaock   The claim rate for undyed diesel fuel taxed at $. H&r blaock 244 and used to produce a diesel-water fuel emulsion is $. H&r blaock 046 per gallon of diesel fuel so used. H&r blaock The blender must be registered by the IRS in order to make the claim. H&r blaock The blender must attach a statement to the claim certifying that: The diesel-water fuel emulsion contains at least 14% water, The emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003, Undyed diesel fuel taxed at $. H&r blaock 244 was used to produce the diesel-water fuel emulsion, and The diesel-water fuel emulsion was used or sold for use in the blender's trade or business. H&r blaock Kerosene for Use in Aviation Ultimate purchasers. H&r blaock   Ultimate purchasers of kerosene used in certain aviation uses may make a claim if the rate of tax on their use is less than the rate of tax that was charged on the kerosene. H&r blaock   The ultimate purchaser of the kerosene used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) is eligible to make a claim if the ultimate purchaser certifies that the right to make the claim has not been waived. H&r blaock Generally, the ultimate purchaser is the aircraft operator. H&r blaock   The following are the nontaxable uses of kerosene used in noncommercial aviation for which a credit or refund may be allowable to the ultimate purchaser. H&r blaock On a farm for farming purposes. H&r blaock Certain helicopter and fixed-wing aircraft uses. H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock Exclusive use by a nonprofit educational organization. H&r blaock In an aircraft owned by an aircraft museum. H&r blaock In military aircraft. H&r blaock Kerosene for use partly in commercial aviation and partly in nonexempt, noncommercial aviation. H&r blaock   If the fuel is used partly for use in commercial aviation and partly for use in nonexempt, noncommercial aviation, the operator may identify, either at the time of purchase or after the kerosene has been used, the amount that will be (or has been) used in commercial aviation. H&r blaock At the same time, the operator would either make the claim or waive the right to make the claim for credit or refund of the kerosene for use in commercial and nonexempt, noncommercial aviation. H&r blaock   If the operator does not identify the amount of kerosene that will be (or has been) used in commercial aviation, the operator may provide a certificate to the ultimate vendor similar to Model Certificate Q in the Appendix. H&r blaock For kerosene purchased with the certificate, used in commercial aviation, and taxed at $. H&r blaock 244 per gallon, use of the certificate will be treated as a waiver of the right to claim a credit or refund for the $. H&r blaock 025 per gallon part of the tax. H&r blaock The ultimate vendor may make this claim. H&r blaock The operator may make a claim for the $. H&r blaock 175 tax per gallon of the kerosene, but cannot waive the right to make the claim for the $. H&r blaock 175 tax per gallon. H&r blaock Sales by Registered Ultimate Vendors Kerosene for use in commercial aviation or noncommercial aviation. H&r blaock   The registered ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may make this claim if the ultimate purchaser waives its right to the credit or payment by providing the registered ultimate vendor with a waiver. H&r blaock A sample waiver is included as Model Waiver L in the Appendix. H&r blaock The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. H&r blaock   Noncommercial aviation means any use of an aircraft not described as commercial aviation. H&r blaock For the definition of commercial aviation, see Commercial aviation on page 11. H&r blaock Kerosene for use in nonexempt, noncommercial aviation. H&r blaock   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in nonexempt, noncommercial aviation. H&r blaock The ultimate vendor must be registered by the IRS (activity letter UA) and have the required certificate from the ultimate purchaser. H&r blaock A sample certificate is included as Model Certificate Q in the Appendix. H&r blaock The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. H&r blaock Kerosene for use in aviation by a state or local government. H&r blaock   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in aviation to a state or local government for its exclusive use (including essential government use by an Indian tribal government). H&r blaock The kerosene for use in aviation must be purchased by the state without the use of a credit card in order for the ultimate vendor to make the claim. H&r blaock The ultimate vendor must be registered by the IRS (activity letter UV) and have the required certificate from the ultimate purchaser. H&r blaock A sample certificate is included as Model Certificate P in the Appendix. H&r blaock The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. H&r blaock Credit card purchases. H&r blaock   If taxed kerosene for use in aviation is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. H&r blaock   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. H&r blaock Other Fuels (Including Alternative Fuels) Credit or refund for nontaxable use of taxed Other Fuels may be allowable to an ultimate purchaser. H&r blaock While tax is generally imposed on delivery, Other Fuels are taxed prior to delivery in the case of certain bulk sales described in chapter 1. H&r blaock The following are the nontaxable uses of Other Fuels for which a credit or refund may be allowable to the ultimate purchaser. H&r blaock On a farm for farming purposes. H&r blaock Off-highway business use. H&r blaock In a boat engaged in commercial fishing. H&r blaock In certain intercity and local buses. H&r blaock In a school bus. H&r blaock In a qualified local bus. H&r blaock Exclusive use by a qualified blood collector organization. H&r blaock Exclusive use by a nonprofit educational organization. H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia. H&r blaock In an aircraft or vehicle owned by an aircraft museum. H&r blaock Use in any boat operated by the United States for its exclusive use or any vessel of war of any foreign nation. H&r blaock See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit, later. H&r blaock Refunds of Second Tax The tax on dyed diesel fuel for inland waterways fuel use applies at the rate listed on Form 720. H&r blaock This is in addition to all other taxes imposed on the sale or use of the fuel. H&r blaock The section 4081(e) refund (discussed below) cannot be claimed. H&r blaock If the tax is paid and reported to the government on more than one taxable event for a taxable fuel under section 4081, the person paying the “second tax” may claim a refund (without interest) of that tax if certain conditions and reporting requirements are met. H&r blaock No credit against any tax is allowed for this tax. H&r blaock For information about taxable events, see the discussions under Gasoline, Diesel Fuel and Kerosene and Kerosene for Use in Aviation in chapter 1. H&r blaock Conditions to allowance of refund. H&r blaock   A claim for refund of the tax is allowed only if all the following conditions are met. H&r blaock A tax on the fuel was paid to the government and not credited or refunded (the “first tax”). H&r blaock After the first tax was imposed, another tax was imposed on the same fuel and was paid to the government (the “second tax”). H&r blaock The person that paid the second tax filed a timely claim for refund containing the information required (see Refund claim, later). H&r blaock The person that paid the first tax has met the reporting requirements, discussed next. H&r blaock Reporting requirements. H&r blaock   Generally, the person that paid the first tax must file a “First Taxpayer's Report” with its Form 720 for the quarter to which the report relates. H&r blaock A model first taxpayer's report is shown in the Appendix as Model Certificate B. H&r blaock The report must contain all information needed to complete the model. H&r blaock   By the due date for filing the Form 720, you must also send a separate copy of the report to the following address. H&r blaock Department of the Treasury Internal Revenue Service  Cincinnati, OH 45999-0555 Write “EXCISE – FIRST TAXPAYER'S REPORT” across the top of that copy. H&r blaock Optional reporting. H&r blaock   A first taxpayer's report is not required for the tax imposed on: Removal at a terminal rack, Nonbulk entries into the United States, and Removals or sales by blenders. H&r blaock However, if the person liable for the tax expects that another tax will be imposed on that fuel, that person should (but is not required to) file a first taxpayer's report. H&r blaock Providing information. H&r blaock   The first taxpayer must give a copy of the report to the buyer of the fuel within the bulk transfer/terminal system or to the owner of the fuel immediately before the first tax was imposed, if the first taxpayer is not the owner at that time. H&r blaock If an optional report is filed, a copy should (but is not required to) be given to the buyer or owner. H&r blaock   A person that receives a copy of the first taxpayer's report and later sells the fuel within the bulk transfer/terminal system must give the copy and a “Statement of Subsequent Seller” to the buyer. H&r blaock If the later sale is outside the bulk transfer/terminal system and that person expects that another tax will be imposed, that person should (but is not required to) give the copy and the statement to the buyer. H&r blaock A model statement of subsequent seller is shown in the Appendix as Model Certificate A. H&r blaock The statement must contain all information necessary to complete the model. H&r blaock   If the first taxpayer's report relates to fuel sold to more than one buyer, copies of that report must be made when the fuel is divided. H&r blaock Each buyer must be given a copy of the report. H&r blaock Refund claim. H&r blaock   You must have filed Form 720 and paid the second tax before you file for a refund of that tax. H&r blaock You must make your claim for refund on Form 8849. H&r blaock Complete Schedule 5 (Form 8849) and attach it to your Form 8849. H&r blaock Do not include this claim with a claim under another tax provision. H&r blaock You must not have included the second tax in the price of the fuel and must not have collected it from the purchaser. H&r blaock You must submit the following information with your claim. H&r blaock A copy of the first taxpayer's report (discussed earlier). H&r blaock A copy of the statement of subsequent seller if the fuel was bought from someone other than the first taxpayer. H&r blaock Definitions of Nontaxable Uses This section provides definitions of the terms used in Table 2-1 for nontaxable uses. H&r blaock If applicable, the type of use number from Table 2-1 is indicated in each heading. H&r blaock Type of use table. H&r blaock   The first column of the table is the number you enter on Form 4136, Form 8849, or Schedule C (Form 720) for that type of use. H&r blaock For type of use 2, the mobile machinery parenthetical applies only to Form 8849 and Form 720. H&r blaock Table 2-1. H&r blaock Type of Use Table No. H&r blaock Type of Use 1 On a farm for farming purposes 2 Off-highway business use (for business use other than in a highway vehicle registered or required to be registered for highway use) (other than use in mobile machinery) 3 Export 4 In a boat engaged in commercial fishing 5 In certain intercity and local buses 6 In a qualified local bus 7 In a bus transporting students and employees of schools (school buses) 8 For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway business use) 9 In foreign trade 10 Certain helicopter and fixed-wing aircraft uses 11 Exclusive use by a qualified blood collector organization 12 In a highway vehicle owned by the United States that is not used on a highway 13 Exclusive use by a nonprofit educational organization 14 Exclusive use by a state, political subdivision of a state, or the District of Columbia 15 In an aircraft or vehicle owned by an aircraft museum 16 In military aircraft On a farm for farming purposes (No. H&r blaock 1). H&r blaock   On a farm for farming purposes means fuel used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. H&r blaock Farm. H&r blaock   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms; orchards; plantations; ranches; nurseries; ranges; and feed yards for fattening cattle. H&r blaock It also includes structures such as greenhouses used primarily for the raising of agricultural or horticultural commodities. H&r blaock A fish farm is an area where fish are grown or raised — not merely caught or harvested. H&r blaock Farming purposes. H&r blaock   As an owner, tenant, or operator, you use fuel on a farm for farming purposes if you use it in any of the following ways. H&r blaock To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. H&r blaock To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. H&r blaock To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. H&r blaock To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. H&r blaock For this use to qualify, you must have produced more than half the commodity so treated during the tax year. H&r blaock Commodity means a single raw product. H&r blaock For example, apples and peaches are two separate commodities. H&r blaock To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if the planting, etc. H&r blaock , is incidental to your farming operations. H&r blaock Your tree operations will be incidental only if they are minor in nature when compared to the total farming operations. H&r blaock   If any other person, such as a neighbor or custom operator, performs a service for you on your farm for any of the purposes listed in (1) or (2), you are considered to be the ultimate purchaser that used the fuel on a farm for farming purposes. H&r blaock However, see Custom application of fertilizer and pesticide, next. H&r blaock   If doubt exists whether the owner, the tenant, or the operator of the farm bought the fuel, determine who bore the cost of the fuel. H&r blaock For example, if the owner of a farm and the tenant equally share the cost of gasoline that is used on a farm for farming purposes, each can claim a credit for the tax on one-half the fuel used. H&r blaock Custom application of fertilizer and pesticide. H&r blaock   Fuel used on a farm for farming purposes includes fuel used in the application of fertilizer, pesticides, or other substances, including aerial applications. H&r blaock Generally, the applicator is treated as having used the fuel on a farm for farming purposes. H&r blaock For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. H&r blaock For kerosene used in aviation, the ultimate purchaser may make the claim or waive their right to make the claim to the registered ultimate vendor. H&r blaock Fuel used between airfield and farm. H&r blaock   Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as a farming purpose. H&r blaock Fuel not used for farming. H&r blaock   Fuel is not used on a farm for farming purposes if it is used in any of the following ways. H&r blaock Off the farm, such as on the highway or in noncommercial aviation, other than fuel used between the airfield and farm described above, even if the fuel is used in transporting livestock, feed, crops, or equipment. H&r blaock For personal use, such as mowing the lawn. H&r blaock In processing, packaging, freezing, or canning operations. H&r blaock In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. H&r blaock Off-highway business use (No. H&r blaock 2). H&r blaock   Off-highway business use means fuel used in a trade or business or in an income-producing activity other than as a fuel in a highway vehicle registered or required to be registered for use on public highways. H&r blaock The terms “highway vehicle,” “public highway,” and “registered” are defined below. H&r blaock Do not consider any use in a boat as an off-highway business use. H&r blaock   Off-highway business use includes fuels used in any of the following ways. H&r blaock In stationary machines such as generators, compressors, power saws, and similar equipment. H&r blaock For cleaning purposes. H&r blaock In forklift trucks, bulldozers, and earthmovers. H&r blaock   Generally, this use does not include nonbusiness use of fuel, such as use by minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. H&r blaock Example. H&r blaock Caroline owns a landscaping business. H&r blaock She uses power lawn mowers and chain saws in her business. H&r blaock The gasoline used in the power lawn mowers and chain saws qualifies as fuel used in an off-highway business use. H&r blaock The gasoline used in her personal lawn mower at home does not qualify. H&r blaock Highway vehicle. H&r blaock   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. H&r blaock Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. H&r blaock A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. H&r blaock A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). H&r blaock A special kind of cargo, goods, supplies, or materials. H&r blaock Some off-highway task unrelated to highway transportation, except as discussed next. H&r blaock Vehicles not considered highway vehicles. H&r blaock   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the credit or refund of fuel taxes. H&r blaock Specially designed mobile machinery for nontransportation functions. H&r blaock A self-propelled vehicle is not a highway vehicle if all the following apply. H&r blaock The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. H&r blaock The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. H&r blaock The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. H&r blaock The vehicle must have traveled less than 7,500 miles on public highways during the taxable year. H&r blaock Vehicles specially designed for off-highway transportation. H&r blaock A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicle's capability to transport a load over a public highway is substantially limited or impaired. H&r blaock To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. H&r blaock It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. H&r blaock Nontransportation trailers and semitrailers. H&r blaock A trailer or semi-trailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. H&r blaock For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. H&r blaock Public highway. H&r blaock   A public highway includes any road in the United States that is not a private roadway. H&r blaock This includes federal, state, county, and city roads and streets. H&r blaock Registered. H&r blaock   A vehicle is considered registered when it is registered or required to be registered for highway use under the law of any state, the District of Columbia, or any foreign country in which it is operated or situated. H&r blaock Any highway vehicle operated under a dealer's tag, license, or permit is considered registered. H&r blaock A highway vehicle is not considered registered solely because a special permit allows the vehicle to be operated at particular times and under specified conditions. H&r blaock Dual use of propulsion motor. H&r blaock   Off-highway business use does not include any fuel used in the propulsion motor of a registered highway vehicle even though that motor also operates special equipment by means of a power take-off or power transfer. H&r blaock It does not matter if the special equipment is mounted on the vehicle. H&r blaock Example. H&r blaock The motor of a registered concrete-mixer truck operates both the engine and the mixing unit by means of a power take-off. H&r blaock The fuel used in the motor to run the mixer is not off-highway business use. H&r blaock Use in separate motor. H&r blaock   Off-highway business use includes fuel used in a separate motor to operate special equipment, such as a refrigeration unit, pump, generator, or mixing unit. H&r blaock If you draw fuel from the same tank that supplies fuel to the propulsion motor, you must figure the quantity used in the separate motor operating the special equipment. H&r blaock You may make a reasonable estimate based on your operating experience and supported by your records. H&r blaock   You can use devices that measure the miles the vehicle has traveled (such as hubometers) to figure the gallons of fuel used to propel the vehicle. H&r blaock Add to this amount the fuel consumed while idling or warming up the motor before propelling the vehicle. H&r blaock The difference between your total fuel used and the fuel used to propel the vehicle is the fuel used in the separate motor. H&r blaock Example. H&r blaock Hazel owns a refrigerated truck. H&r blaock It has a separate motor for the refrigeration unit. H&r blaock The same tank supplies both motors. H&r blaock Using the truck's hubometer, Hazel figures that 90% of the fuel was used to propel the truck. H&r blaock Therefore, 10% of the fuel is used in an off-highway business use. H&r blaock Fuel lost or destroyed. H&r blaock   You cannot treat fuel lost or destroyed through spillage, fire, or other casualty as fuel used in an off-highway business use. H&r blaock Export (No. H&r blaock 3). H&r blaock   Export means fuel transported from the United States with the intention that the fuel remain in a foreign country or possession of the United States. H&r blaock Fuel is not exported if it is in the fuel supply tank of a vehicle or aircraft. H&r blaock In a boat engaged in commercial fishing (No. H&r blaock 4). H&r blaock   In a boat engaged in commercial fishing means fuel used in taking, catching, processing, or transporting fish, shellfish, or other aquatic life for commercial purposes, such as selling or processing the catch, on a specific trip basis. H&r blaock They include boats used in both fresh and salt water fishing. H&r blaock They do not include boats used for both sport fishing and commercial fishing on the same trip. H&r blaock In certain intercity and local buses (No. H&r blaock 5). H&r blaock   In certain intercity and local buses means fuel used in a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. H&r blaock The bus must be engaged in one of the following activities. H&r blaock Scheduled transportation along regular routes. H&r blaock Nonscheduled operations if the seating capacity of the bus is at least 20 adults, not including the driver. H&r blaock Vans and similar vehicles used for van-pooling or taxi service do not qualify. H&r blaock Available to the general public. H&r blaock   This means you offer service to more than a limited number of persons or organizations. H&r blaock If a bus operator normally provides charter operations through travel agencies but has buses available for chartering by the general public, this service is available to the general public. H&r blaock A bus does not qualify when its operator uses it to provide exclusive services to only one person, group, or organization. H&r blaock Also, intercity bus transportation does not include transporting students and employees of schools or intercity transportation in a qualified local bus. H&r blaock In a qualified local bus (No. H&r blaock 6). H&r blaock   In a qualified local bus means fuel used in a bus meeting all the following requirements. H&r blaock It is engaged in furnishing (for compensation) intracity passenger land transportation available to the general public. H&r blaock It operates along scheduled, regular routes. H&r blaock It has a seating capacity of at least 20 adults (excluding the driver). H&r blaock It is under contract with (or is receiving more than a nominal subsidy from) any state or local government to furnish the transportation. H&r blaock Intracity passenger land transportation. H&r blaock   This is the land transportation of passengers between points located within the same metropolitan area. H&r blaock It includes transportation along routes that cross state, city, or county boundaries if the routes remain within the metropolitan area. H&r blaock Under contract. H&r blaock   A bus is under contract with a state or local government only if the contract imposes a bona fide obligation on the bus operator to furnish the transportation. H&r blaock More than a nominal subsidy. H&r blaock   A subsidy is more than nominal if it is reasonably expected to exceed an amount equal to 3 cents multiplied by the number of gallons of fuel used in buses on subsidized routes. H&r blaock A company that operates its buses along subsidized and unsubsidized intracity routes may consider its buses qualified local buses only when the buses are used on the subsidized intracity routes. H&r blaock In a school bus (No. H&r blaock 7). H&r blaock   In a school bus means fuel used in a bus engaged in the transportation of students or employees of schools. H&r blaock A school is an educational organization with a regular faculty and curriculum and a regularly enrolled body of students who attend the place where the educational activities occur. H&r blaock For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel (No. H&r blaock 8). H&r blaock   Diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train (not including off-highway business use) means undyed diesel fuel and undyed kerosene used: For home heating, lighting, and cooking; In boats; In stationary machines, such as generators and compressors; For cleaning purposes; or In minibikes and snowmobiles. H&r blaock In foreign trade (No. H&r blaock 9). H&r blaock   In foreign trade means fuel used in civil aircraft employed in foreign trade or trade between the United States and any of its possessions. H&r blaock The term trade includes the transportation of persons or property for hire and the making of the necessary preparations for such transportation. H&r blaock In the case of aircraft registered in a foreign country, the country must allow reciprocal benefits for aircraft registered in the United States. H&r blaock Certain helicopter and fixed-wing aircraft uses (No. H&r blaock 10). H&r blaock   Includes: Certain helicopter uses. H&r blaock   Certain helicopter uses means fuel used by a helicopter for any of the following purposes. H&r blaock Transporting individuals, equipment, or supplies in the exploration for, or the development or removal of, hard minerals, oil, or gas. H&r blaock Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). H&r blaock Providing emergency medical transportation. H&r blaock   During a use described in items (1) and (2), the helicopter must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. H&r blaock For item (1), treat each flight segment as a separate flight. H&r blaock Fixed-wing aircraft uses. H&r blaock   Fixed-wing aircraft uses means fuel used by a fixed-wing aircraft for any of the following purposes. H&r blaock Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). H&r blaock Providing emergency medical transportation. H&r blaock The aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. H&r blaock During a use described in item (1), the aircraft must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. H&r blaock Exclusive use by a qualified blood collector organization (No. H&r blaock 11). H&r blaock   Exclusive use by a qualified blood collector organization means fuel used by the qualified blood collector organization for its exclusive use in the collection, storage, or transportation of blood. H&r blaock Qualified blood collector organization. H&r blaock   A qualified blood collector organization is one that is: Described in section 501(c)(3) and exempt from tax under section 501(a), Primarily engaged in the activity of collecting human blood, Registered by the IRS, and Registered by the Food and Drug Administration to collect blood. H&r blaock In a highway vehicle owned by the United States that is not used on a highway (No. H&r blaock 12). H&r blaock   In a highway vehicle owned by the United States that is not used on a highway means fuel used in a vehicle that was not used on public highways during the period covered by the claim. H&r blaock This use applies whether or not the vehicle is registered or required to be registered for highway use. H&r blaock Exclusive use by a nonprofit educational organization (No. H&r blaock 13). H&r blaock   Exclusive use by a nonprofit educational organization means fuel used by an organization exempt from income tax under section 501(a) that meets both of the following requirements. H&r blaock It has a regular faculty and curriculum. H&r blaock It has a regularly enrolled body of students who attend the place where the instruction normally occurs. H&r blaock   A nonprofit educational organization also includes a school operated by a church or other organization described in section 501(c)(3) if the school meets the above requirements. H&r blaock Exclusive use by a state, political subdivision of a state, or the District of Columbia (No. H&r blaock 14). H&r blaock   Exclusive use by a state, political subdivision of a state, or the District of Columbia means fuel purchased by the state or local government for its exclusive use. H&r blaock A state or local government is any state, any political subdivision thereof, or the District of Columbia. H&r blaock An Indian tribal government is treated as a state only if the fuel is used in an activity that involves the exercise of an essential tribal government function. H&r blaock Gasoline, diesel fuel, and kerosene used by the American Red Cross is considered to be the use of these fuels by a state. H&r blaock In an aircraft or vehicle owned by an aircraft museum (No. H&r blaock 15). H&r blaock   In an aircraft or vehicle owned by an aircraft museum means fuel used in an aircraft or vehicle that is owned by an organization that meets all the following requirements. H&r blaock It is exempt from income tax as an organization described in section 501(c)(3). H&r blaock It is operated as a museum under a state (or District of Columbia) charter. H&r blaock It is operated exclusively for acquiring, exhibiting, and caring for aircraft of the type used for combat or transport in  World War II. H&r blaock   The aircraft or vehicle (such as a ground servicing vehicle for aircraft) must be used exclusively for the purposes described in item (3). H&r blaock In military aircraft (No. H&r blaock 16). H&r blaock   In a military aircraft means fuel used in an aircraft owned by the United States or any foreign nation and constituting a part of its armed forces. H&r blaock In commercial aviation (other than foreign trade). H&r blaock   See Commercial aviation, earlier, for the definition. H&r blaock Use in a train. H&r blaock   Use in a train means fuel used in the propulsion engine of equipment or machinery that rides on rails. H&r blaock This includes use in a locomotive, work train, switching engine, and track maintenance machine. H&r blaock Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit For alternative fuel mixtures produced after December 31, 2011, see How to Claim the Credit below. H&r blaock The section 6426 credit for biodiesel and alternative fuel consists of the biodiesel or renewable diesel mixture credit, alternative fuel credit, and alternative fuel mixture credit. H&r blaock Biodiesel or renewable diesel mixture credit claimant. H&r blaock   Claimant produced a biodiesel mixture by mixing biodiesel with diesel fuel. H&r blaock Claimant produced a renewable diesel mixture by mixing renewable diesel with liquid fuel (other than renewable diesel). H&r blaock   The person that produced and sold or used the mixture in their trade or business is the only person eligible to make this claim. H&r blaock The credit is based on the gallons of biodiesel or renewable diesel in the mixture. H&r blaock Renewable diesel does not include any fuel derived from coprocessing biomass (as defined in section 45K(c)(3)) with a feedstock that is not biomass. H&r blaock Claim requirements. H&r blaock   See the Instructions for Form 720 for the biodiesel or renewable diesel mixture claim requirements. H&r blaock Alternative fuel credit claimant. H&r blaock   For the alternative fuel credit, the registered alternative fueler who (1) sold an alternative fuel at retail delivered it into the fuel supply tank of a motor vehicle or motorboat, (2) sold an alternative fuel, delivered it in bulk taxable use in a motor vehicle or motorboat, and received required statement from the buyer, (3) used an alternative fuel (not sold at retail or in bulk as previously described) motor vehicle or motorboat, or (4) sold an alternative fuel used as a fuel in aviation is the only person eligible to make this claim. H&r blaock Carbon capture requirement. H&r blaock   A credit for Fischer-Tropsch process liquid fuel derived from coal (including peat) can be claimed only if the fuel is derived from coal produced at a gasification facility that separates and sequesters at least 75% of the facility's total carbon dioxide emissions. H&r blaock Alternative fuel credit. H&r blaock   The registered alternative fueler is the person eligible to make the claim. H&r blaock An alternative fueler is the person liable for tax on alternative fuel under the rules for taxable events for Other Fuels (discussed in chapter 1) or would be liable but for an exemption for nontaxable uses. H&r blaock An alternative fueler includes a person who sells for use or uses an alternative fuel in aviation. H&r blaock Alternative fuel mixture credit claimant. H&r blaock   For the alternative fuel mixture credit, the registered alternative fueler that produced and sold or used the mixture as a fuel in their trade or business is the only person eligible to make this claim. H&r blaock The credit is based on the gallons of alternative fuel in the mixture. H&r blaock An alternative fuel mixture is a mixture of alternative fuel and section 4081 taxable fuel (gasoline, diesel fuel, or kerosene). H&r blaock Registration. H&r blaock   You must be registered by the IRS to be eligible to claim the section 6426 fuel credit. H&r blaock See Registration Requirements in chapter 1. H&r blaock Credits for fuel provide incentive for United States production. H&r blaock   The section 6426 fuel credit may not be claimed for alternative fuel that is produced outside the United States for use as a fuel outside the United States. H&r blaock The United States includes any possession of the United States. H&r blaock Credit for fuels derived from paper or pulp production. H&r blaock   Credit for alternative fuels and alternative fuel mixtures for any fuel derived from the production of paper or pulp are not available for fuel sold or used on or after December 31, 2009. H&r blaock How to Claim the Credit Any biodiesel or renewable diesel mixture credit must first be claimed on Schedule C to reduce your taxable fuel liability reported on Form 720. H&r blaock Any excess credit may be claimed on Schedule C (Form 720), Schedule 3 (Form 8849), Form 4136, or Form 8864, Biodiesel and Renewable Diesel Fuels Credit. H&r blaock See Notice 2005-4 and the Instructions for Form 720 for more information. H&r blaock Also see Notice 2013-26 on page 984 of I. H&r blaock R. H&r blaock B. H&r blaock 2013-18 at www. H&r blaock irs. H&r blaock gov/pub/irs-irbs/irb13-18. H&r blaock pdf; and see chapter 2, later. H&r blaock Coordination with income tax credit. H&r blaock   Only one credit may be taken for any amount of biodiesel or renewable diesel. H&r blaock If any amount is claimed (or will be claimed) for any amount of biodiesel or renewable diesel on Form 720, Form 8849, or Form 4136, then a claim cannot be made on Form 8864 for that amount of biodiesel or renewable diesel. H&r blaock   Any alternative fuel credit must first be claimed on Schedule C (Form 720) to reduce your section 4041 taxable fuel liability for alternative fuel and CNG reported on Form 720. H&r blaock Any excess credit may claimed on Schedule C (Form 720), Schedule 3 (Form 8849), or Form 4136. H&r blaock   For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit can be claimed on Schedule C (Form 720), not on Form 4136 or Schedule 3 (Form 8849), and only to the extent of your section 4081 taxable fuel liability for gasoline, diesel fuel and kerosene reported on Form 720. H&r blaock   Calculate the limitation for alternative fuel mixtures separately and enter on Schedule C (Form 720), line 14, only the gallons of mixtures that do not exceed your section 4081 taxable fuel liability. H&r blaock Filing Claims This section tells you how to make a claim for a credit or refund of excise taxes on fuels. H&r blaock This section also covers recordkeeping requirements and when to include the credit or refund in your income. H&r blaock Generally, you will provide all the information needed to claim a credit or refund when you properly complete Form 8849, Form 4136, Schedule C (Form 720), Form 6478, or Form 8864. H&r blaock In some cases, you will have to attach additional information. H&r blaock You need to keep records that support your claim for a credit or refund. H&r blaock Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. H&r blaock Ultimate purchaser. H&r blaock   Ultimate purchasers may make claims for the nontaxable use of fuels on Form 4136, Schedule 1 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. H&r blaock If you are an ultimate purchaser, you must keep the following records. H&r blaock The number of gallons purchased and used during the period covered by your claim. H&r blaock The dates of the purchases. H&r blaock The names and addresses of suppliers and amounts purchased from each in the period covered by your claim. H&r blaock The nontaxable use for which you used the fuel. H&r blaock The number of gallons used for each nontaxable use. H&r blaock It is important that your records show separately the number of gallons used for each nontaxable use that qualifies as a claim. H&r blaock If the fuel is exported, you must have proof of exportation. H&r blaock   For more information about keeping records, see Publication 583, Starting a Business and Keeping Records, or chapter 1 of Publication 17, Your Federal Income Tax for Individuals. H&r blaock Exceptions. H&r blaock    Generally, the ultimate purchaser may not claim a credit or refund for undyed diesel fuel, undyed kerosene, or kerosene for use in aviation sold for the exclusive use of a state or local government. H&r blaock However, see Claims by credit card issuers, later, for an exception. H&r blaock The ultimate purchaser may not claim a credit or refund as follows. H&r blaock The ultimate purchaser of gasoline or aviation gasoline used by a state or local government for its exclusive use or by a nonprofit educational organization for its exclusive use may waive its right to make a claim by providing a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate M. H&r blaock A new certificate is required each year or when any information in the current certificate expires. H&r blaock The ultimate purchaser of kerosene for use in commercial aviation or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver L. H&r blaock A new waiver is required each year or when any information in the current waiver expires. H&r blaock The ultimate purchaser of undyed diesel fuel or undyed kerosene used in certain intercity and local buses may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver N. H&r blaock A new waiver is required each year or when any information in the current waiver expires. H&r blaock The ultimate purchaser of kerosene for use in nonexempt, noncommercial aviation must provide a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate Q. H&r blaock A new certificate is required each year or when any information in the current certificate expires. H&r blaock Registered ultimate vendor. H&r blaock   Registered ultimate vendors may make claims for certain sales of fuels on Form 4136, Schedule 2 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. H&r blaock If you are a registered ultimate vendor, you must keep certain information pertaining to the sale of the fuel. H&r blaock   To make a claim, you must have sold the fuel at a tax-excluded price, repaid the tax to the buyer, or obtained the buyer's written consent to the allowance of the claim. H&r blaock You are required to have a valid certificate or waiver in your possession in order to make the claim. H&r blaock   In addition, you must have a registration number that has not been revoked or suspended. H&r blaock See Form 637. H&r blaock State use. H&r blaock   To make a claim as an ultimate vendor (state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained below. H&r blaock If you sell undyed diesel fuel, undyed kerosene, or kerosene for use in aviation for use by a state or local government, you must keep the following information. H&r blaock The name and taxpayer identification number of each person (government unit) that bought the fuel. H&r blaock The number of gallons sold to each person. H&r blaock An unexpired certificate from the buyer. H&r blaock See Model Certificate P in the Appendix. H&r blaock The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. H&r blaock Nonprofit educational organization and state use. H&r blaock   To make a claim as an ultimate vendor (nonprofit educational organization or state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained later. H&r blaock If you sell gasoline or aviation gasoline to a nonprofit educational organization for its exclusive use or to a state or local government for its exclusive use, you must keep the following information. H&r blaock The name and taxpayer identification number of each person (nonprofit educational organization or government unit) that bought the fuel. H&r blaock The number of gallons sold to each person. H&r blaock An unexpired certificate from the buyer. H&r blaock See Model Certificate M in the Appendix. H&r blaock  The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. H&r blaock Blocked pump. H&r blaock   To make a claim as an ultimate vendor (blocked pump), you must have a UP registration number. H&r blaock If you sell undyed kerosene (other than kerosene for use in aviation) from a pump that qualifies as a blocked pump because it is locked by you after each sale and is unlocked by you at the request of the buyer, you must keep the following information for each sale of more than 5 gallons. H&r blaock The date of each sale. H&r blaock The name and address of the buyer. H&r blaock The number of gallons sold to that buyer. H&r blaock Certain intercity and local bus use. H&r blaock   To make a claim as an ultimate vendor of undyed diesel fuel or undyed kerosene used in certain intercity and local buses, you must have a UB registration number. H&r blaock You must keep the following information. H&r blaock The date of each sale. H&r blaock The name and address of the buyer. H&r blaock The number of gallons sold to the buyer. H&r blaock A copy of the waiver signed by the buyer at the time the credit or payment is claimed. H&r blaock See Model Waiver N in the Appendix. H&r blaock Kerosene for use in commercial aviation or noncommercial aviation. H&r blaock   To make a claim as an ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia), you must have a UA registration number. H&r blaock See Kerosene for use in aviation, earlier, for a list of nontaxable uses. H&r blaock You must keep the following information. H&r blaock The date of each sale. H&r blaock The name and address of the buyer. H&r blaock The number of gallons sold to the buyer. H&r blaock A copy of the waiver signed by the buyer at the time the credit or payment is claimed. H&r blaock See Model Waiver L in the Appendix. H&r blaock Kerosene for use in nonexempt, noncommercial aviation. H&r blaock   To make a claim as an ultimate vendor of kerosene for use in nonexempt, noncommercial aviation, you must have a UA registration number. H&r blaock You must keep the following information. H&r blaock The date of each sale. H&r blaock The name and address of the buyer. H&r blaock The number of gallons sold to the buyer. H&r blaock A copy of the certificate signed by the buyer at the time the credit or payment is claimed. H&r blaock See Model Certificate Q in the Appendix. H&r blaock Claims by credit card issuers. H&r blaock   For sales of gasoline, aviation gasoline, diesel fuel, kerosene, or kerosene for use in aviation that are purchased by an exempt user with the use of a credit card, the registered credit card issuer is the only person who can make the claim. H&r blaock An exempt user for this purpose is: For gasoline or aviation gasoline, a state or local government (including essential government use by an Indian tribal government) or a nonprofit educational organization; or For diesel fuel, kerosene, or kerosene for use in aviation, a state or local government (including essential government use by an Indian tribal government). H&r blaock   If gasoline is purchased without the use of a credit card, then the registered ultimate vendor of the gasoline may make the claim for refund or credit. H&r blaock However, if the gasoline is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. H&r blaock   If diesel fuel, kerosene, or kerosene for use in aviation is purchased without the use of a credit card, the registered ultimate vendor may make the claim for refund or credit. H&r blaock A state is not allowed to make a claim for these fuels. H&r blaock However, if the diesel fuel or kerosene is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. H&r blaock   The claim from the credit card issuer must contain the following information as it applies to the fuel covered in the claim. H&r blaock The total number of gallons. H&r blaock Its registration number. H&r blaock A statement that it has not collected the amount of tax from the ultimate purchaser or has obtained the written consent of the ultimate purchaser to make the claim. H&r blaock A statement that it has repaid or agreed to repay the amount of tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to make the claim, or has otherwise made arrangements which directly or indirectly provide the ultimate vendor with reimbursement of the tax. H&r blaock Has in its possession an unexpired certificate similar to Model Certificate R in the Appendix and has no reason to believe any of the information in the certificate is false. H&r blaock Taxpayer identification number. H&r blaock   To file a claim, you must have a taxpayer identification number. H&r blaock Your taxpayer identification number can be an: Employer identification number (EIN), Social security number (SSN), or Individual taxpayer identification number (ITIN), if you are an alien individual and do not have and are not eligible to get an SSN. H&r blaock   If you normally file only a U. H&r blaock S. H&r blaock individual income tax return (such as Form 1040 or 1040NR), use your SSN or ITIN. H&r blaock You get an SSN by filing Form SS-5, Application for a Social Security Card, with the Social Security Administration. H&r blaock To get an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. H&r blaock   If you operate a business, use your EIN. H&r blaock If you do not have an EIN, you may apply for one online. H&r blaock Go to the IRS website at irs. H&r blaock gov/businesses/small and click on the “Employer ID Numbers (EINs)” link. H&r blaock You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. H&r blaock Claiming A Refund Generally, you may claim a refund of excise taxes on Form 8849. H&r blaock Complete and attach to Form 8849 the appropriate Form 8849 schedules. H&r blaock The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. H&r blaock If you file Form 720, you can use the Schedule C (Form 720) for your refund claims for the quarter. H&r blaock See the Instructions for Form 720. H&r blaock Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Schedule C (Form 720) or Form 4136. H&r blaock The alternative fuel mixture credit must be claimed on Schedule C (Form 720) against your section 4081 taxable fuel liability for gasoline, diesel, and kerosene and any excess is not allowed. H&r blaock The alternative fuel credit must first be claimed on Schedule C (Form 720) against your section 4041 taxable fuel liability for alternative fuel and CNG. H&r blaock To the extent the alternative fuel credit exceeds this taxable fuel liability, a payment is allowed and may be claimed as a credit on Schedule C (Form 720), or as an income tax credit on Forms 4136, 6478, or 8864, as applicable. H&r blaock Only one claim may be made for any particular amount of alternative fuel. H&r blaock Claiming a Credit on Form 4136 For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit cannot be claimed on Form 4136. H&r blaock See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2, earlier. H&r blaock A credit may be claimed for certain uses and sales of fuels on Form 4136 when you file your income tax return at the end of the year. H&r blaock If you meet certain requirements (discussed earlier), you may be able to make a claim during the year. H&r blaock Credit only. H&r blaock   You can claim the following taxes only as a credit on Form 4136. H&r blaock Tax on fuels used for nontaxable uses if the total for your tax year is less than $750. H&r blaock Tax on fuel you did not include in any claim for refund previously filed for any quarter of your tax year. H&r blaock Tax on fuel you used in mobile machinery (off-highway business use) that traveled less than 7,500 miles on public highways. H&r blaock Do not claim a credit for any amount for which you have filed a refund claim on Form 8849 or credit on Schedule C (Form 720). H&r blaock When to file. H&r blaock   You can claim a fuel tax credit on your income tax return for the year you used the fuel (or sold the fuel in the case of a registered ultimate vendor claim). H&r blaock You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. H&r blaock Generally, you must file an amended return by the later of 3 years from the date you filed your original return or within 2 years from the date you paid the income tax. H&r blaock How to claim a credit. H&r blaock   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, or farmers' cooperative association. H&r blaock Individuals. H&r blaock   You claim the credit on the “Credits from” line of Form 1040. H&r blaock Also check box b on that line. H&r blaock If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. H&r blaock Partnerships. H&r blaock   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. H&r blaock , showing each partner's share of the number of gallons of each fuel sold or used for a non
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Tax Information For International Businesses

Foreign Account Tax Compliance Act
FATCA will increase information reporting by foreign financial institutions, non-financial foreign entities, and certain U.S. persons holding financial assets outside the United States.

2012 Offshore Voluntary Disclosure Program
The IRS offers an offshore voluntary disclosure program to help people get current with their taxes. The current program is open for an indefinite period until otherwise announced.

Transfer Pricing Audit Roadmap Now Available
The Transfer Pricing Audit Roadmap is a toolkit organized around a notional 24 month audit timeline. It provides recommended audit procedures and links to reference material. It is not intended as a template. Every transfer pricing case is unique and requires the exercise of judgment and discretion.

Help with Tax Questions - International Taxpayers
If you've looked around our site and still didn't find the answer to your general tax question for International Taxpayers, we'd like to help.

Qualified Intermediaries (QI)
A Qualified Intermediary (QI) is any foreign intermediary (or foreign branch of a U.S. intermediary) that has entered into a qualified intermediary withholding agreement with the IRS. A QI is entitled to certain simplified withholding and reporting rules.

U.S. Withholding Agent Program
Focus enforcing compliance through examinations and voluntary compliance of withholding tax on foreign payments. Responsibilities include coordinating exams and training exam teams, consulting with internal/externals stakeholders, and providing guidance to ensure consistent treatment for taxpayers.

Internal Revenue Service International Visitors' Program (IVP)
The purpose of the International Visitors Program is to introduce the Internal Revenue Service as one of the world's premier tax systems to interested countries.

Income from Abroad is Taxable
There have been recent reports about the interest of the Internal Revenue Service (IRS) in taxpayers with bank accounts in Liechtenstein. The IRS' interest, however, extends beyond bank accounts in Liechtenstein to financial accounts anywhere in the world. The IRS reminds you to report your worldwide income on your U.S. tax return and lists the possible consequences of hiding income overseas.

U.S. Citizens by Birth or through a U.S. Citizen Parent
All persons born in the United States are U.S. citizens. This is the case regardless of the tax or immigration status of a persons parents. Furthermore, a person born outside the United States may also be a U.S. citizen at birth if at least one parent is a U.S. citizen and has lived in the United States for a period of time.

U.S. Citizens and Resident Aliens Abroad
This section covers tax topics for U.S. citizens or resident aliens living overseas.

Taxation of Nonresident Aliens
The U.S. source income of nonresident aliens is subject to U.S. taxation.

Taxation of U.S. Resident Aliens
A resident alien's income is generally subject to tax in the same manner as a U.S. citizen.

Foreign Students and Scholars
Aliens temporarily present in the United States as students, trainees, teachers, researchers, exchange visitors, and cultural exchange visitors are subject to special rules with respect to the taxation of their income.

Tax Withholding on Foreign Persons
This section covers tax withholding topics for payments made to U.S. citizens abroad or aliens employed both in the United States and abroad. This section also covers tax withholding and reporting rules on payments of U.S. source income made to foreign persons.

Tax Treaties
Tax treaties may allow residents of foreign countries to be taxed at a reduced rate, or to be exempt from U.S. income taxes on certain items of income they receive from sources within the United States.

Taxpayer Identification Numbers (TIN)
A Taxpayer Identification Number (TIN) is an identification number used by the Internal Revenue Service (IRS) in the administration of tax laws.

Taxation of Foreign Athletes and Entertainers
This section describes the special rules which affect the taxation of foreign athletes and entertainers who have income sourced in the United States.

Alien Taxation - Certain Essential Concepts
This section describes certain essential concepts involved in the taxation of aliens.

Classification of Taxpayers for U.S. Tax Purposes
This section will help you determine if you are a "Foreign Person" or a "United States person" for U.S. tax purposes.

Determining Alien Tax Status
If you are an alien (not a U.S. citizen), you are considered a nonresident alien unless you meet the Green Card test or the Substantial Presence test.

Taxation of Dual-Status Aliens
You are a dual-status alien when you have been both a resident alien and a nonresident alien in the same tax year.

Special Categories of Alien Workers
For U.S. tax purposes, Au Pairs and Farm Workers may be treated differently than others.

Report of Foreign Bank and Financial Accounts (FBAR)
If you own a foreign bank account, brokerage account, mutual fund, unit trust, or other financial account, then you may be required to report the account yearly to the Internal Revenue Service.

Employees of Foreign Governments or International Organizations
The wages paid to employees of foreign governments and international organizations are not usually taxable, but may be taxable in the case of U.S. citizens and resident aliens.

New Developments in International Taxation
This section provides the latest news on international taxes.

Miscellaneous International Tax Issues
This section covers subjects not previously discussed.

Frequently Asked Questions - International Taxpayers
Frequently Asked Questions for Aliens and U.S. Citizens Living Abroad

Page Last Reviewed or Updated: 25-Mar-2014

 

The H&r Blaock

H&r blaock Publication 575 - Additional Material Table of Contents Worksheet A. H&r blaock Simplified Method 1. H&r blaock Enter the total pension or annuity payments received this year. H&r blaock Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. H&r blaock   2. H&r blaock Enter your cost in the plan (contract) at the annuity starting date plus any death benefit exclusion. H&r blaock * See Cost (Investment in the Contract) , earlier 2. H&r blaock   Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). H&r blaock Otherwise, go to line 3. H&r blaock   3. H&r blaock Enter the appropriate number from Table 1 below. H&r blaock But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below. H&r blaock 3. H&r blaock   4. H&r blaock Divide line 2 by the number on line 3 4. H&r blaock   5. H&r blaock Multiply line 4 by the number of months for which this year's payments were made. H&r blaock If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. H&r blaock Otherwise, go to line 6 5. H&r blaock   6. H&r blaock Enter any amounts previously recovered tax free in years after 1986. H&r blaock This is the amount shown on line 10 of your worksheet for last year 6. H&r blaock   7. H&r blaock Subtract line 6 from line 2 7. H&r blaock   8. H&r blaock Enter the smaller of line 5 or line 7 8. H&r blaock   9. H&r blaock Taxable amount for year. H&r blaock Subtract line 8 from line 1. H&r blaock Enter the result, but not less than zero. H&r blaock Also, add this amount to the total for Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. H&r blaock  Note: If your Form 1099-R shows a larger taxable amount, use the amount figured on this line instead. H&r blaock If you are a retired public safety officer, see Insurance Premiums for Retired Public Safety Officers , earlier, before entering an amount on your tax return 9. H&r blaock   10. H&r blaock Was your annuity starting date before 1987? □ Yes. H&r blaock STOP. H&r blaock Do not complete the rest of this worksheet. H&r blaock  □ No. H&r blaock Add lines 6 and 8. H&r blaock This is the amount you have recovered tax free through 2013. H&r blaock You will need this number if you need to fill out this worksheet next year 10. H&r blaock   11. H&r blaock Balance of cost to be recovered. H&r blaock Subtract line 10 from line 2. H&r blaock If zero, you will not have to complete this worksheet next year. H&r blaock The payments you receive next year will generally be fully taxable 11. H&r blaock   * A death benefit exclusion (up to $5,000) applied to certain benefits received by employees who died before August 21, 1996. H&r blaock Table 1 for Line 3 Above   IF the age at  annuity starting date was . H&r blaock . H&r blaock . H&r blaock         AND your annuity starting date was—     BEFORE November 19, 1996,  enter on line 3 . H&r blaock . H&r blaock . H&r blaock AFTER November 18, 1996,  enter on line 3 . H&r blaock . H&r blaock . H&r blaock   55 or under 300 360   56-60 260 310   61-65 240 260   66-70 170 210   71 or over 120 160 Table 2 for Line 3 Above   IF the combined ages at annuity starting date were . H&r blaock . H&r blaock . H&r blaock   THEN enter on line 3 . H&r blaock . H&r blaock . H&r blaock         110 or under   410         111-120   360         121-130   310         131-140   260         141 or over   210       Prev  Up  Next   Home   More Online Publications