Form 6478 (Rev. January 2020) can be used to figure your section 40 biofuel producer credit for tax years beginning after 2017. Qualified second generation biofuel production includes liquid fuel derived from qualified feedstocks and other conditions. Producers of second generation biofuel must be registered with the IRS and may face penalties if they do not use the fuel for the specific purpose.
What is Form 6478?
Form 6478 is used to figure a taxpayer’s section 40 biofuel producer credit for tax years beginning after 2017. Qualified second generation biofuel production is any liquid fuel that meets the registration requirements for fuels and fuel additives established by the Environmental Protection Agency under Section 211 of the Clean Air Act. This can include lignocellulosic or hemicellulosic matter on a renewable or recurring basis, as well as cultivated algae, cyanobacteria, or lemna. It must not include any fuel with more than 4% water or sediment, a 1% ash content, or an acid number greater than 25. Any producers of second generation biofuel must be registered with the IRS and, if the fuel is not used for QSGBP purposes, a tax recapture must be paid.
IRS Form 6478 – Who Needs to Fill It Out?
IRS Form 6478 must be filled out by partnerships, S Corporations, cooperatives, estates, and trusts, in order to claim the credit for the section 40 biofuel producer credit for tax years beginning after 2017. Other taxpayers who receive this credit from a partnership, S Corporation, cooperative, estate, or trust may report the credit directly on the appropriate line of Form 3800, General Business Credit. Qualified second generation biofuel production includes any lignocellulosic or hemicellulosic matter that’s available on a renewable or recurring basis, as well as any cultivated algae, cyanobacteria, or lemna. Moreover, all producers of second generation biofuel must be registered with the IRS. If the fuel isn’t used for the appropriate purpose, a tax (recapture) must be paid on each gallon of second generation biofuel at the rate used to figure the credit.
Step-by-Step: Form 6478 Instructions For Filling Out the Document
Form 6478 is used to figure the Section 40 biofuel producer credit for tax years beginning after 2017, with the credit being claimed for the tax year in which the sale or use occurs. This Form is to be completed and filed by partnerships, S corporations, cooperatives, estates, and trusts. Qualified second generation biofuel production is an essential part of filling out Form 6478, which includes fuel derived by, or from, qualified feedstocks that meets registration requirements in addition to not being alcohol of less than 150 proof and not containing more than 4% of water and sediment, more than 1% of ash content, or an acid number greater than 25. Additionally, all producers of second generation biofuel must be registered with the IRS and a tax is to be reported if it is not used for the stated purpose.
Below, we present a table that will help you understand how to fill out Form 6478.
| Information Required for Form 6478 | Details |
|---|---|
| Biofuel Credits | Details on biodiesel and renewable diesel fuel credits |
| Qualified Second Generation Biofuel | Criteria for second-generation biofuel |
| Registration and Taxes | Registration requirements and taxes |
| Additional Information | Additional resources and notices |
Do You Need to File Form 6478 Each Year?
Yes, producers of second generation biofuel must file Form 6478 (Rev. January 2020) to figure their section 40 biofuel producer credit. This form must be filed for the tax year in which the sale or use occurs, and you have 3 years to decide to claim or not claim the credit. However, if your only source for this credit is a partnership, S corporation, cooperative, estate, or trust, then you do not need to complete or file Form 6478. Instead, you can report the credit directly on the appropriate line of Form 3800, General Business Credit. It is important to note that you must pay a tax (recapture) if you don’t use the fuel for the purposes described under Qualified Second Generation Biofuel Production, and report this tax on Form 720, Quarterly Federal Excise Tax Return.
Download the official IRS Form 6478 PDF
On the official IRS website, you will find a link to download Form 6478. However, to make it easier for you, we are providing the link in our article, which comes directly from the official irs.gov website! Click to download: Form 6478
Sources:
