Rutgers University | NJAES | SEBS     New Jersey Agricultural Experiment Station

Alternative Fuel Mixture Excise Tax Credit

The tax credit provides $0.50 per gallon incentive for alternative fuel blenders.

Terms and Qualifications:

  • An alternative fuel blender that is registered with the Internal Revenue Service (IRS) may be eligible for a tax incentive on the sale or use of the alternative fuel blend (mixture) for use as a fuel in the blender’s trade or business.
  • The credit is in the amount of $0.50 per gallon of alternative fuel used to produce a mixture containing at least 0.1% gasoline, diesel, or kerosene.
  • Qualified alternative fuels are liquefied hydrogen, P-Series fuel, liquid fuel derived from coal through the Fischer-Tropsch process, and liquid fuel derived from biomass.
  • The incentive must first be taken as a credit against the blender’s alternative fuel tax liability; any excess over this fuel tax liability may be claimed as a direct payment from the IRS.
  • The tax credit is not allowed if an incentive for the same alternative fuel is also determined under the rules for the ethanol or biodiesel tax credits.

IRS Form 4136:

Program Administrator:
US Internal Revenue Service (IRS); US Department of Energy (DOE)

Expiration Date:
Program Extended Through December 31, 2020

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