Fuel Tax Credits

Fuel Tax Credit – Recover Taxes Paid at the Pump

The fuel tax credit allows businesses to recover federal excise taxes paid on gasoline and diesel used for non-taxable purposes. Since fuel taxes primarily fund highway maintenance, businesses using fuel for off-road equipment, certain transportation services, and other qualifying uses may be eligible for a refund.

Who Qualifies for the Fuel Tax Credit?

• Off-road fuel use – Fuel used in construction equipment, farm machinery, generators, and refrigerated trailers.
• School transportation – Fuel used in buses that transport students, including childcare center shuttles.
• Certain local bus services – Public transportation operating on scheduled routes.

Key Considerations for Claiming the Credit

• Proof of purchase is required – The credit is based on gallons purchased, not fuel price.
• Tax-free fuel purchases do not qualify – If fuel was already purchased without taxes (e.g., dyed diesel), it is ineligible.
• IRS scrutiny has increased – Proper record-keeping is essential, as the IRS closely monitors this credit for compliance.

Businesses with significant fuel usage can recover substantial tax refunds. If your business uses fuel for eligible purposes, let us know so we can ensure you claim this credit correctly.