Alternative Fuel Tax Credit
The Alternative Fuel Tax Credit is available to any individual or entity that:
- Sells “alternative fuel” (propane) for use in a motor vehicle or motorboat within the United States, or
- Uses the “alternative fuel” (propane) for such a purpose in the United States.
The amount of the credit equates to approximately $.37/gal of propane ($.50/gallon gasoline equivalent).
This tax credit is available retroactively for 2022. This one-time opportunity began October 13, 2022, and runs through April 11, 2023.
Be sure to contact your tax professional to confirm your eligibility and complete the appropriate forms. Your monetary return may be significant.
Qualifying Vehicles
The IRS regulations declare what constitutes a “motor vehicle” for purposes of the Alternative Fuel Tax Credit.
The IRS term includes:
“All types of vehicles propelled by motor that are designed for carrying or towing loads from one place to another, regardless of the type of load or materials carried or towed and whether or not the vehicle is registered or required to be registered for highway use.”
The regulation explicitly includes: “forklift trucks
The regulation excludes:
Farm tractors
Trench diggers
Power shovels
Bulldozers
Road grader or rollers
And similar equipment which does not carry or tow a load
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