IRS Releases AFTC Guidance

The Internal Revenue Service (IRS) has released guidance on claiming the Alternative Fuels Tax Credit (AFTC) for past years 2018 and 2019. The $0.50/gallon credit for natural gas motor vehicle fueling began in 2006 and was recently extended through calendar year 2020.

IRS Notice 2020-8 indicates that retroactive claims for 2018 and 2019 should be submitted using Form 8849, Schedule 3 and by submission of a single one-time claim that must be filed no later than August 11, 2020. Claims are made using Form 8849 (Claim for Refund of Excise Taxes) with accompanying Schedule 3 (Certain Fuel Mixtures and the Alternative Fuel Credit), and claims should cover the entire two-year time period. The IRS has indicated that taxpayers who filed protective or anticipatory claims prior to the release of Notice 2020-8 must refile their claims; the IRS will not consider the previous claims perfected by the extension of the tax credits.

To file a claim, a person must be a registered alternative fueler. If you previously submitted claims to the IRS, then you are likely registered. First time claimants who are not registered must file Form 637 (Application for Registration) prior to making claims for credits. Persons intending to file the claim should seek advice from tax counsel or an accountant.

More detailed information is available for NGVAmerica members in our newly released AFTC Fact Sheet accessible via our members-only Member365 portal or by contacting an NGVA team member directly.