Internal Revenue Code:Sec. 6426. Credit for alcohol fuel and biodiesel mixtures
From TaxAlmanac, A Free Online Resource for Tax Professionals
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
(Redirected from Sec. 6426. Credit for alcohol fuel and biodiesel mixtures)
Contents |
Location in Internal Revenue Code
TITLE 26 - INTERNAL REVENUE CODE
Subtitle F - Procedure and Administration
CHAPTER 65 - ABATEMENTS, CREDITS, AND REFUNDS
Subchapter B - Rules of Special Application
Statute
SEC. 6426. CREDIT FOR ALCOHOL FUEL AND BIODIESEL MIXTURES.
<<<NOTE: After 10/10/2006 the heading for this section is
amended by PL 109-059 to be:
"Section 6426. Credit for Alcohol Fuel, Biodiesel and Alternative Fuel Mixtures">>>
(a) Allowance of Credits.--There shall be allowed as a credit against
the tax imposed by section 4081 an amount equal to the sum of--
(1) the alcohol fuel mixture credit,
(2) the biodiesel mixture credit,
<<NOTE: For sale or use for any periods after 9/30/2006, subsection (a)
is amended by PL 109-059 to read as follows:
(a) Allowance of Credits.--There shall be allowed as a credit
(1) against the tax imposed by section 4081 an amount equal
to the sum of the credits described in subsections (b),
(c), and (e), and
(2) against the tax imposed by section 4041 an amount equal to
the sum of the credits described in subsection (d).
No credit shall be allowed in the case of the credits described in
subsections (d) and (e) unless the taxpayer is registered under
section 4101. >>
(b) Alcohol Fuel Mixture Credit.--
(1) In general.--For purposes of this section, the alcohol
fuel mixture credit is the product of the applicable amount and
the number of gallons of alcohol used by the taxpayer in
producing any alcohol fuel mixture for sale or use in a trade or
business of the taxpayer.
(2) Applicable amount.--For purposes of this subsection--
(A) In general.--Except as provided in
subparagraph (B), the applicable amount is 51 cents.
(B) Mixtures not containing ethanol.--In the case
of an alcohol fuel mixture in which none of the alcohol
consists of ethanol, the applicable amount is 60 cents.
(3) Alcohol fuel mixture.--For purposes of this
subsection, the term `alcohol fuel mixture' means a mixture of
alcohol and a taxable fuel which--
(A) is sold by the taxpayer producing such mixture
to any person for use as a fuel, or
(B) is used as a fuel by the taxpayer producing
such mixture.
For purposes of subparagraph (A), a mixture produced by any
person at a refinery prior to a taxable event which includes
ethyl tertiary butyl ether or other ethers produced from alcohol
shall be treated as sold at the time of its removal from the
refinery (and only at such time) to another person for use as a
fuel.
(4) Other definitions.--For purposes of this subsection--
(A) Alcohol.--The term `alcohol' includes methanol
and ethanol but does not include--
(i) alcohol produced from petroleum, natural
gas, or coal (including peat), or
(ii) alcohol with a proof of less than 190
(determined without regard to any added denaturants).
Such term also includes an alcohol gallon equivalent of
ethyl tertiary butyl ether or other ethers produced from
such alcohol.
(B) Taxable fuel.--The term `taxable fuel' has the
meaning given such term by section 4083(a)(1).
(5) Termination.--This subsection shall not apply to any
sale, use, or removal for any period after December 31, 2010.
(c) Biodiesel Mixture Credit.--
(1) In general.--For purposes of this section, the
biodiesel mixture credit is the product of the applicable amount
and the number of gallons of biodiesel used by the taxpayer in
producing any biodiesel mixture for sale or use in a trade or
business of the taxpayer.
(2) Applicable amount.--For purposes of this subsection--
(A) In general.--Except as provided in
subparagraph (B), the applicable amount is 50 cents.
(B) Amount for agri-biodiesel.--In the case of any
biodiesel which is agri-biodiesel, the applicable amount
is $1.00.
(3) Biodiesel mixture.--For purposes of this section, the
term `biodiesel mixture' means a mixture of biodiesel and diesel
fuel (as defined in section 4083(a)(3)), determined without
regard to any use of kerosene, which--
(A) is sold by the taxpayer producing such mixture
to any person for use as a fuel, or
(B) is used as a fuel by the taxpayer producing
such mixture.
(4) Certification for biodiesel.--No credit shall be
allowed under this subsection unless the taxpayer obtains a
certification (in such form and manner as prescribed by the
Secretary) from the producer of the biodiesel which identifies
the product produced and the percentage of biodiesel and agri-
biodiesel in the product.
(5) Other definitions.--Any term used in this subsection
which is also used in section 40A shall have the meaning given
such term by section 40A.
(6) Termination.--This subsection shall not apply to any
sale, use, or removal for any period after December 31,
2008.
<<<NOTE: For any sale or use after 9/30/2006, existing paragraphs (d)
and (e) are renumbered (f) and (g), and the following new
paragraphs (d) and (e) are inserted:
(d) Alternative Fuel Credit.--
(1) In general.--For purposes of this section, the
alternative fuel credit is the product of 50 cents and the
number of gallons of an alternative fuel or gasoline gallon
equivalents of a nonliquid alternative fuel sold by the taxpayer
for use as a fuel in a motor vehicle or motorboat, or so used by
the taxpayer.
(2) Alternative fuel.--For purposes of this section, the
term `alternative fuel' means--
(A) liquefied petroleum gas,
(B) P Series Fuels (as defined by the Secretary of
Energy under section 13211(2) of title 42, United States
Code),
(C) compressed or liquefied natural gas,
(D) liquefied hydrogen,
(E) any liquid fuel derived from coal (including
peat) through the Fischer-Tropsch process, and
(F) liquid fuel derived from biomass (as
defined in section 45K(c)(3)).
Such term does not include ethanol, methanol, or biodiesel.
(3) Gasoline gallon equivalent.--For purposes of this
subsection, the term `gasoline gallon equivalent' means, with
respect to any nonliquid alternative fuel, the amount of such
fuel having a Btu content of 124,800 (higher heating value).
(4) Termination.--This subsection shall not apply to any
sale or use for any period after September 30, 2009 (September
30, 2014, in the case of any sale or use involving liquefied
hydrogen).
(e) Alternative Fuel Mixture Credit.--
(1) In general.--For purposes of this section, the
alternative fuel mixture credit is the product of 50 cents and
the number of gallons of alternative fuel used by the taxpayer
in producing any alternative fuel mixture for sale or use in a
trade or business of the taxpayer.
(2) Alternative fuel mixture.--For purposes of this
section, the term `alternative fuel mixture' means a mixture of
alternative fuel and taxable fuel (as defined in subparagraph
(A), (B), or (C) of section 4083(a)(1)) which--
(A) is sold by the taxpayer producing such mixture
to any person for use as fuel, or
(B) is used as a fuel by the taxpayer producing
such mixture.
(3) Termination.--This subsection shall not apply to any
sale or use for any period after September 30, 2009 (September
30, 2014, in the case of any sale or use involving liquefied
hydrogen). >>>
<<NOTE: Prior to 10/1/2006, this is paragraph (d)>>
(f) Mixture Not Used As a Fuel, Etc.--
(1) Imposition of tax.--If--
(A) any credit was determined under this section
with respect to alcohol or biodiesel used in the
production of
any alcohol fuel mixture or biodiesel mixture,
respectively, and
(B) any person--
(i) separates the alcohol or biodiesel from
the mixture, or
(ii) without separation, uses the mixture
other than as a fuel,
then there is hereby imposed on such person a tax equal
to the product of the applicable amount and the number
of gallons of such alcohol or biodiesel.
(2) Applicable laws.--All provisions of law, including
penalties, shall, insofar as applicable and not inconsistent
with this section, apply in respect of any tax imposed under
paragraph (1) as if such tax were imposed by section 4081 and
not by this section.
<<NOTE: Prior to 10/1/2006, this is paragraph (e)>>
(g) Coordination With Exemption From Excise Tax.--Rules similar to
the rules under section 40(c) shall apply for purposes of this
section.
(h) Denial of Double Benefit.--No credit shall be determined under
subsection (d) or (e) with respect to any fuel with respect to which
credit may be determined under subsection (b) or (c) or under section 40
or 40A.
Sources
Miscellaneous
AMENDMENTS
2007 - PL 110-172
(2) Subparagraph (F) of <<NOTE: 26 USC 6426.>> section
6426(d)(2) is amended by striking ``hydrocarbons'' and inserting
``fuel''.
(3) Section 6426 is amended by adding at the end the
following new subsection:
``(h) Denial of Double Benefit.--No credit shall be determined under
subsection (d) or (e) with respect to any fuel with respect to which
credit may be determined under subsection (b) or (c) or under section 40
or 40A.''.
(b) Effective <<NOTE: 26 USC 6426 note.>> Date.--The amendments made
by this section shall take effect as if included in the provisions of
the SAFETEA-LU to which they relate.
2005 - Energy Policy Act 2005, Sec.1344, amended this
Sec.6426(c)(6), by striking `2006' and inserting `2008'.
The amendments made by this section shall take effect
on the date of the enactment of this Act.
2005 - Public Law 109-059 amends Sec. 6426(d)(2)(F) by striking
"section 29(c)(3)" and inserting "section 45K(c)(3)". This
amendment effective for any period after September 30, 2006.
2005 - Public Law 109-059 amends Sec. 6426
by striking from the heading "alcohol fuel and biodiesel' and
inserting "certain alternative fuel-"; and amends Sec. 6426(a)
by redesignating subsections (d) and (e) as subsections (f) and (g)
and by inserting after subsection (c) the following new subsection:
"(d) Alternative Fuel Credit-". Effective Date- The amendments
made by this section shall apply to any sale, use, or removal for
any period after September 30, 2006.
2004 - Pub.L. 108-357, Sec. 301(a). Subchapter B of chapter 65
is amended by inserting after section 6425 the following new section:
"SEC. 6426. CREDIT FOR ALCOHOL FUEL AND BIODIESEL MIXTURES".
References
SECTION REFERRED TO IN OTHER SECTIONS
