Refrigerated Trailer Fuel Tax Credit

The IRS allows a tax credit to trucking companies based on the number of undyed diesel fuel gallons purchased in a given year. This specifically helps individuals and companies who transport refrigerated goods. The credit is $.244 per gallon of off-highway use diesel for gallons purchased before October 1, 2005. The credit is $.243 per gallon for gallons purchased after September 30, 2005.

This is a refundable credit, which means that you can get the credit refunded to you even if you didn’t owe taxes. This can add up to HUGE tax savings for refrigerated truckers. For example, if you purchased 10,000 gallons of undyed diesel to use in your refrigerated trailer in 2006, you would receive a credit of $2,430. This is a dollar-for-dollar reduction of your tax liability! What if you don’t have a tax liability? The government will add your credit to your tax refund.

If you would like more information, please call Brady Pipkin at 501.753-9700 or e-mail Brady at brady.pipkin@bellancompany.net.

A Special One Time Tax Credit on Your 2006 Individual Tax Return

Phone companies have been given notice to stop assessing the federal excise tax as of August 30, 2006 on toll calls. This change in telephone billing statements demands restitution. Thus, the IRS has announced that a one time credit will be available when filing your 2006 tax return of which will be limited. For instance if you are a single person without any dependents, you can claim a $30 credit on line 71 on your 1040. If you are single and have a dependent(s), you can claim a $40 credit. If you are a married couple and file jointly, you can also claim a $40 credit. Finally, if you are married, file jointly, and have dependents you can claim $50 for one child and $60 for two children.

The maximum credit you can claim is $60. The only exception is if you have all your phone bills starting AFTER February 28, 2003 through July31, 2006. In this case you can add up the ACTUAL TAX AS IT APPEARS ON YOUR BILLS AND CLAIM THAT FOR A CREDIT. If you have your actual phone bills and come up with the ACTUAL TAX AMOUNT, you cannot use line 71 on your tax return. Rather you must complete Form 8913 and attach it to your tax return. This tax credit is a refundable credit and you will receive this amount regardless of how your tax return works out.

If you file a business return please contact Sylvia at Bell & Company 501.753.9700.

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