Last Updated : January 14, 2009
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6478

Form 6478

Tax On Lump sum Distributions

Credit For Alcohol Used as Fuel

PURPOSE OF THE FORM:

Use form 6478 to figure the credit fro Alcohol used as fuel. The credit can be claimed in the tax year in which the sale or use occurs. This credit consists of :

  • Alcohol Mixture Credit.
  • Alcohol Credit.
  • Small Ethanol Producer Credit.


The taxpayer may claim or elect not to claim the alcohol fuel credit at any time within 3 years from the due date of his / her return on either an original or an amended return for the tax year of the sale or use.
Before claiming a credit on FORM 6478, the alcohol fuel mixture credit must be taken against any section 4081 liability on FORM 720. Any credit in excess of the section 4081 liability can be taken as a claim for payment on FORM 8849 or an income tax credit on form 4136.

ALCOHOL:
Alcohol, for credit purposes, includes ethanol and Methanol by does not include the following:

  • Alcohol produced from petroleum, natural gas or coal (including peat). Methanol produced from Methane gas formed in waste disposal sites is not alcohol produced from natural Gas, and is included for credit purposes.
  • Alcohol of less than 150 proof. In figuring the proof of any alcohol, disregard any denaturants . The column of the alcohol includes any denaturant up to 5 % of the volume of the alcohol and denaturant combined.
    THe alcohol must not be a mixture with gasoline or special fuel (other than as a denaturant). THe credit is for alcohol which during the tax year was :
  • (1) Used as a fuel in a trade or business, or
  • (2)Sold at retail to another person and put in the fuel tank of that person' s vehicle.

ALCOHOL FUEL MIXTURE:
The alcohol must be used to make a Qualified mixture. A Qualified mixture combines alcohol with Gasoline or special fuel. The producer of the mixture either:

  • Used it as fuel, or
  • Sold it as fuel to another person.
    The credit is available only to the producer who blends the mixture. The producer must use or sell the mixture in a trade or business and the credit is available only for the year the mixture is sold or used.
    The credit is not allowed for casual off-farm production of a qualified mixture.


PART - I CURRENT YEAR CREDIT :

Use Lines 1 through 3 to figure any alcohol fuel credit from your own trade or business.

Line 1 Inner :
Enter on this line the number of gallons of ethanol, up to 15 million gallons, that meets the conditions of Qualified Ethanol Fuel Production.
For definition of Qualified Ethanol Fuel Production refer instructions of form 6478.

Line 1 outer:
The program calculates the total ethanol Fuel Production by multiplying the number of gallons entered on line 1 inner by applicable rate of 10 cents per gallon.

Line 2a:
Enter on this line the number of gallons of ethanol that is 190 proof or greater on line 2a inner.
The program calculates the total ethanol fuel production by multiplying the number of gallons entered on line 2a inner by the applicable rate 51 cents per gallon.

Line 2b:
Enter on this line the number of gallons of alcohol other than ethanol that is 190 proof or greater on line 2b inner.
The program calculates the total ethanol fuel production by multiplying the number of gallons entered on line 2b inner by the applicable rate 60 cents per gallon.
The amount of credit determined for line 2 with respect to alcohol in Qualified Mixtures must be reduced by the excise tax benefit for Qualified Methanol or Ethanol fuel reflected on FORM 720.

Line 3a:
Enter on this line the number of gallons of ethanol that is 190 proof or less on line 3a inner.
The program calculates the total ethanol fuel production by multiplying the number of gallons entered on line 3a inner by the applicable rate 37.78 cents per gallon.

Line 3b:
Enter on this line the number of gallons of alcohol other than ethanol that is 190 proof or less on line 3b inner.
The program calculates the total ethanol fuel production by multiplying the number of gallons entered on line 3b inner by the applicable rate 45 cents per gallon.
The amount of credit determined for line 3 with respect to alcohol in Qualified Mixtures must be reduced by the excise tax benefit for Qualified Methanol or Ethanol fuel reflected on FORM 720.

Line 4:
The program adds the total credit calculated on line 1 , line 2 and line 3 column c.

Line 5:
The amount on this line comes from schedule K-1P/S and schedule K-1ET line named Alcohol credit.

Line 6:
The program adds lines 4 and line 5 and enters the result on this line.

Line 7:
Enter on this line the amount included on line 6 that is from a passive activity. Generally Passive activity is a trade or business in which the taxpayer did not materially participate .Rental activities are considered as passive activities whether or not the taxpayer did not materially participate. refer instructions of FORM 8582 CR or form 8810.

Line 8:
The program subtracts Line7 outer total amount from line 6 and enters the result here.

Line 9:
Enter the passive activity credit allowed for 2006 credit for alcohol used as fuel from FORM 8582CR or FORM 8810.

Line 10:
Carry forward :
Enter on line 10 any carry forward of the credit from 2006. For carry forwards of the credit from years prior to 2006, show such carry forwards on line 6 of form 3800.
Carryback : Enter on line 10 any carryback if the taxpayer has amended his 2007 return to carryback an unused credit from 2008.

Line 11:
The program adds lines 8 through 10 and enters the result on this line.

Line 12 and line 13:
These lines are not applicable to Individuals.


PART - II ALLOWABLE CREDIT :

Line 14:
The amount on this line comes from FORM 1040 line 44 (tax) or FORM 1040NR line 41(tax).

Line 15:
THe amount on this line comes from FORM 6251 line 35 (alternative Minimum Tax).

Line 16:
THe program adds line 14 and line 15 and enters the result on this line.

Line 17a:
The amount on this line comes from FORM 1040 :
total of line 47 (child and dependent care benefits), line 48 ( credit for elderly and disabled) , line 49 (education credits), Line 50 (residential energy credits) , line 52 (child tax credit) , line 53 ( Retirement savings contribution credit) , line 54 ( form 8396 line 13) , (form 8859 line 13) , (form 8839 line 18) .
OR from FORM 1040NR:
total of line 44 (child & dependent care benefits) , line 45 (residential energy credits) , line 47 (child tax credit) , line 48 (retirement savings contribution credit) , line 49 ( form 8396 line 13) , (form 8859 line 13) , (form 8839 line 18) .

Line 17b:
The amount on this line comes from FORM 1040 line 51 (foreign tax credit) or FORM 1040NR line 46(foreign tax credit).

Line 17c:
The amount on this line comes from Form 8834 line 20 (qualified electric vehicle credit).

Line 17d:
The amount on this line comes from Form 8910 line 18 (Alternative Motor vehicle credit).

Line 17e:
The amount on this line comes from Form 8911 line 19 (Alternative Fuel vehicle Refueling property credit).

Line 17f:
The program adds line 17a through line 17e and enters the result here.

Line 18:
The program subtracts line 17f from line 16 and enters the result on this line. If the result is negative then it is set as zero.

Line 19:
The program subtracts line 17f from line 14 and enters the result on this line. If the result is negative then it is set as zero.

Line 20:
If line 19 is greater then $25000 then the program calculates 25% of Excess over $25000 and enters the result on this line.

Line 21:
The program subtracts line 20 from line 18 and enters the result on this line. If the result is negative then it is set as zero.

Line 22a:
The amount on this line comes from FORM 3800 line 19 (general business credit).

Line 22b:
The amount on this line comes from FORM 8844 line 26 (empowerment zone and renewal community employment credit).

Line 22c:
The amount on this line comes from FORM 5884 line 22 (work Opportunity credit).

Line 23:
The program subtracts line 22 from line 21 and enters the result on this line. If the result is negative then it is set as zero.

Line 24:
The program enters the lower of line 11 or line 23 here and reports this amount on FORM 1040 line 55 or FORM 1040NR line 50.
If you cannot use all of the credit because of the tax liability limit, carry the unused credit back 1 year then forward up to 20 years.

Supported States

Supported States

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IL MD MI NC NM NJ
NY OH PA SC VT
     

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