Business Tax Credit For Fuel Use

You can claim a credit for federal excise tax you paid on fuels you used:

• On a farm for farming purposes (Ex: fuel used to run a tractor while plowing)
• On a boat used for commercial fishing
• For off-highway business use. This is fuel used in a trade or business, or in an income-producing activity like:
  • Using stationary machines like:
    • Generators
    • Compressors
    • Power saws
    • Similar equipment
  • Cleaning
  • Using mobile machines like:
    • Forklift trucks
    • Bulldozers
    • Earthmovers

Off-highway business use doesn’t include use in a registered highway vehicle.

You must report the credit you claim as income on Schedule F if both of these are true:

• You’re a farmer.
• You claim a deduction for this tax as part of your total fuel expense on Schedule F.

Also, you might deduct the total cost of fuel you use on Schedule C for off-highway business use or commercial fishing. If so, you must report the amount you claim as income on Schedule C.

To claim this credit, complete Form 4136: Credit for Federal Tax Paid on Fuels at www.irs.gov.