From motor vehicles to solar energy, businesses can save on costs while still taking advantage of tax credits and deductions for eco-friendly investments. Get the details here on how to take advantage of these tax savings.
What is Form 3468?
Form 8910 and 8911 provide tax credits for businesses when they purchase and use environmentally friendly motor vehicles. Form 8864 provides a credit for using biodiesel or renewable diesel fuels. Form 3468 offers a general investment tax credit for various energy efficient projects, adjusted depending on start year. These projects may include solar property, fuel cell, and small wind energy property. Tax deductions are also available, such as the 179D deduction for buildings that reduce their energy and power costs by 50%. For these credits and deductions to be applied, businesses must own or build the equipment and have it placed into service that same year. Make sure to consult a tax professional before attempting to claim any of these credits or deductions.
IRS Form 3468 – Who Needs to Fill It Out?
All businesses are eligible for tax deductions and tax credits to help reduce their business taxes. This guide focuses on the various tax credits and tax deductions available for ‘green’ projects, such as the Alternative Fuel Vehicle Refueling Property Credit (Form 8911), Alternative Motor Vehicle Credit (Form 8910), Biodiesel and Renewable Diesel Fuels Credit (Form 8864), and Solar Investment Tax Credit (Form 3468). To make the most out of tax credits and deductions, businesses must own the equipment placed into service and meet specific performance and quality standards. Furthermore, depending on the type of tax benefit, there may be forms to fill and certifications to acquire before being eligible for the credit or deduction. Therefore, your business should talk with a tax professional to ensure that all qualifications are met to maximize tax savings.
Step-by-Step: Form 3468 Instructions For Filling Out the Document
Filing out the form for tax credit and deductions can be a complicated process. To get started, find the credit application form for the specific tax credit and complete it, then add the information to Form 3800, the General Tax Credit. For energy investment tax credits, fill out Form 3468 and include it with your business tax return. Deductions can be included in the “Other Deductions” section in your business tax return and require certification before or after you complete the upgrades. When in doubt always consult with a tax professional to make sure you understand all of the restrictions, qualifications, and limitations of these tax savings.
Below, we present a table that will help you understand how to fill out Form 3468.
| Form or Step | Description |
|---|---|
| 1. Find Credit Application Form | Locate the specific tax credit application form |
| 2. Complete Credit Application Form | Fill out the credit application form with the required information |
| 3. Form 3800 | Add the information to Form 3800 (General Tax Credit) |
| 4. Energy Investment Tax Credits | For energy investment tax credits, complete Form 3468 and include it with your business tax return |
| 5. Deductions | Include deductions in the “Other Deductions” section of your business tax return and ensure proper certification before or after upgrades |
| 6. Consult Tax Professional | When in doubt, consult with a tax professional to understand all restrictions, qualifications, and limitations of these tax savings |
Do You Need to File Form 3468 Each Year?
Depending on the project you have put in place, yes, you may need to file specific forms each year in order to make the most of the tax credits and deductions associated with energy-saving projects. Both individual businesses filing their taxes as part of a personal return and partnerships and S-corporations must file the form in order to get the specific tax credit. For individual business owners, this process involves building an associated form to Form 3800 and then including the information onto your tax return. Deductions may be simpler and can be included in the “Other Deductions” section of the return. Whatever you decide, make sure to do your research and consult with a tax professional.
Download the official IRS Form 3468 PDF
On the official IRS website, you will find a link to download Form 8910 and Form 8864 – the forms necessary to apply for Alternative Motor Vehicle and Biodiesel and renewable diesel fuels credits. 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 3468
Sources:
https://www.irs.gov/forms-pubs/about-form-3468
https://www.irs.gov/instructions/i3468
