Form 8849 Schedule 3 8849 Schedule 3 Certain Fuel Mixtures and the Alternative Fuel Credit.

Schedule 3 (Form 8849), Certain Fuel Mixtures and the
Alternative Fuel Credit (Rev. October 2006)
Purpose: This is the first circulated draft of Schedule 3 (Form 8849) for your review and
comments. See below for a discussion of the major changes.
TPCC Meeting: None, but one may be arranged if requested.
Prior Version: The February 2005 Schedule 3 (Form 8849) is available at:
http://www.irs.gov/pub/irs-pdf/f8849s3.pdf
Other Products: Circulations of draft tax forms, instructions, notices, and publications
are posted at: http://taxforms.web.irs.gov/draft_products.html
Comments: Please email, fax, call, or mail any comments by August 11, 2006.
Michael Ecker
Tax Law Specialist
SE:W:CAR:MP:T:T:SB
NCFB C7-265 (Temporary Location)
Phone: 202-283-0196
VMS: 202-622-3144
Fax: 202-283-7008
Email: Michael.D.Ecker@irs.gov

Major Changes
These changes are based on the Energy Tax Incentives Act of 2005 and the
Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy
for Users or "SAFETEA-LU."
•

Schedule 3 is re-titled Certain Fuel Mixtures and the Alternative Fuel Credit
to reflect the addition of the alternative fuel mixture credit and alternative fuel
credit as provided by IRC 6426(d) & 6426(e).

•

We changed the title of line 2 to Biodiesel or Renewable Diesel Mixture Credit.
Change made per IRC 40A(f).
Add line 2c for renewable diesel mixtures (Rate = $1.00 & CRN 307).
•

Under line 2, we added that the biodiesel used to produce the biodiesel mixture
must meet ASTM D6751 and be registered with the EPA as a fuel and fuel
additive under section 211 of the Clean Air Act. This change was requested by
CC:PSI:8.

•

We added new line 3, Alternative Fuel Credit and Alternative Fuel Mixture
Credit (after Sept. 30, 2006). Change made per IRC 6426(d) & 6426(e).
Line 3a Liquefied petroleum gas (LPG) (Rate = .50 & CRN 426)
Line 3b “P series” fuels (Rate = .50 & CRN 427)
Line 3c Compressed natural gas (CNG) (Rate = .50 & CRN 428)
Line 3d Liquefied hydrogen (Rate = .50 & CRN 429)
Line 3e Any liquid fuel derived from coal (including peat) through the FischerTropsch process (Rate = .50 & CRN 430)
Line 3f Liquefied hydrocarbons derived from biomass (Rate = .50 & CRN 431)
Line 3g Liquefied natural gas (LNG) (Rate = .50 & CRN 432)
Note. Chief Counsel has not released guidance for the alternative fuel credit and
alternative fuel mixture credit. Additional requirements maybe necessary in order
to make these claims.
•

Under What’s New, we added information about the changes discussed above.

•

We added Excise Tax liability to discuss the tax implications of blending a
nontax liquid with a taxable fuel.

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Date

I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTERS
SCHEDULE 3 (FORM 8849), PAGE 1 of 2
MARGINS: TOP 13mm (1⁄ 2 "), CENTER SIDES.
PAPER: WHITE WRITING, SUB. 20. INK: BLACK
FLAT SIZE: 216mm (81⁄ 2 ") 3 279mm (11")
PERFORATE: NONE

Date

Revised proofs
requested

Certain Fuel Mixtures and
the Alternative Fuel Credit

(Rev. October 2006)
Department of the Treasury
Internal Revenue Service
Name as shown on Form 8849

©

Signature

O.K. to print

PRINTS: FACE ONLY

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

Schedule 3
(Form 8849)

Action

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OMB No. 1545-1420

Attach to Form 8849. Do not file with any other schedule.
EIN or SSN

Total refund (see instructions)

$

Caution. Before claiming a credit on Form 8849, the alcohol fuel mixture credit, biodiesel or renewable diesel mixture credit, alternative fuel
mixture credit, and alternative fuel credit must be taken against any taxable fuel liability on Form 720. Any credit in excess of the sections 4041
and 4081 liability can be taken as a claim for payment on Form 8849 or an income tax credit on Form 4136. You cannot claim any amounts on
Form 8849 that you claimed (or will claim) on Schedule C (Form 720) or Form 4136.

Claimant’s registration no.

©

If you your
are a registration
registered blender
or taxable
fuelthe
registrant,
enter
registration
number,
including
the must
prefix,enter
on the
entry
line above.
Enter
number,
including
prefix, on
theyour
entry
line above.
Line 3
claimants
their
registration
number.
Period of claim: Enter month, day, and year
in MMDDYYYY format.
From ©
To ©

1

Alcohol Fuel Mixture Credit

Claimant produced an alcohol fuel mixture by mixing taxable fuel with alcohol. The alcohol fuel mixture was sold by the claimant to any
person for use as a fuel or was used as a fuel by the claimant.
(a)
Rate

a Alcohol fuel mixtures containing ethanol
b Alcohol fuel mixtures containing alcohol (other than ethanol)
2
Biodiesel or Renewable Diesel Mixture Credit

(b)
Gallons of alcohol

$ .51

(c) Amount of claim
Multiply col. (a) by col. (b).

$

(d)
CRN
393
394

.60

Claimant produced a mixture by mixing diesel fuel with biodiesel or renewable diesel. The biodiesel used to produce the biodiesel mixture
must meet ASTM D6751 and be registered with the EPA as a fuel and fuel additive under section 211 of the Clean Air Act. The mixture
was sold by the claimant to any person for use as a fuel or was used as a fuel by the claimant. For biodiesel, claimant has attached the
Certificate for Biodiesel and, if applicable, the Statement of Biodiesel Reseller. For renewable diesel, claimant has a certificate from the
producer or importer of the renewable diesel that identifies the product produced and the percentage of renewable diesel in the product.
(a)
Rate

(b)
Gallons of biodiesel

(c) Amount of claim
Multiply col. (a) by col. (b).

(d)
CRN

$

388

or renewable diesel

a Biodiesel (other than agri-biodiesel) mixtures
b Agri-biodiesel mixtures
c Renewable diesel mixtures
3
Alternative Fuel Credit and Alternative Fuel Mixture
Credit (after September 30, 2006)

$ .50

390

1.00

307

1.00

Registration No.
(a)
Rate

©

(b)
Gallons or gasoline

(c) Amount of claim
Multiply col. (a) by col. (b).

(d)
CRN

$

426

gallon equivalents

a
b
c
d
e
f
g

Liquefied petroleum gas (LPG)
"P Series" fuels
Compressed natural gas (CNG)
Liquefied hydrogen
Any liquid fuel derived from coal (including peat)
Liquid hydrocarbons derived from biomass
Liquefied natural gas (LNG)

$ .50

427

.50
.50
.50
.50
.50
.50

428
429
430
431
432

Instructions

through the Fischer-Tropsch process Coordination With Excise Tax Credit
Only one credit may be taken with respect to any gallon of
What’s New
alcohol reported on line 1 or biodiesel reported on line 2. If any
● Renewable diesel will generally be treated the same as
amount is claimed (or will be claimed), with respect to any
biodiesel for refund purposes. Line 2c has been added for
gallon of alcohol or biodiesel on Form 720 or Form 4136, then
renewable diesel mixtures. Effective for renewable diesel sold
a claim cannot be made on Form 8849 for that gallon of
or used after December 31, 2005.
alcohol or biodiesel.
● Line 3 has been added for the alternative fuel credit and
Caution. Before claiming a refund on Form 8849, the mixture
alternative fuel mixture credit. These credits are effective
credit must first be applied against any taxable fuel liability
after September 30, 2006.
on Form 720. Any credit in excess of the section 4081
liability can be claimed on Form 8849.
For Privacy Act and Paperwork Reduction Act Notice, see Form 8849 instructions.

Cat. No. 27451F

Schedule 3 (Form 8849) (Rev. 10-2006)

3
I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTERS
SCHEDULE 3 (FORM 8849), PAGE 2 of 2
MARGINS: TOP 13mm (1⁄ 2 "), CENTER SIDES.
PAPER: WHITE WRITING, SUB. 20. INK: BLACK
FLAT SIZE: 216mm (81⁄ 2 ") 3 279mm (11")
PERFORATE: NONE

PRINTS: FACE ONLY

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

Schedule 3 (Form 8849) (Rev. 10-2006)

Excise Tax Liability

Page

Add all amounts in column (c) and enter the result in the
total refund box at the top of the schedule. This amount
must be at least $200 to file a claim.

Multiply the number of gallons or gasoline gallon equivalents
by the rate and enter the result in the boxes for column (c).

How To File

Attach Schedule 3 to Form 8849. On the envelope write
“Fuel Mixture and Alternative Fuel Claim” and mail to the IRS
at the address under Where To File in the Form 8849
instructions.

Line 1. Alcohol Fuel Mixture Credit

2. For the biodiesel mixture credit, the claimant has a
certificate from the producer. See Certificate below for
details.
3. The amount of the claim must be at least $200. To meet
the minimum, amounts from lines 1, 2, and 3 may be
combined.
4. The claim must be filed by the last day of the first quarter
following the earliest quarter of the claimant’s income tax
year included in the claim. For example, a calendar-year
claimant’s claim for a biodiesel mixture sold or used during
June and July must be filed by September 30.
Note. If requirements 1-4 above are not met, see Annual
Claims in the Form 8849 instructions.
Certificate. The Certificate for Biodiesel and, if applicable,
Statement of Biodiesel Reseller, must be attached to the first
claim filed that is supported by the certificate or statement.
See Model Certificate O and Model Certificate S in Pub. 510.
If the certificate and statement are not attached to Form
4136 because they are attached to a previously-filed claim
on Schedule C (Form 720) or Schedule 3 (Form 8849) for the
biodiesel, attach a separate sheet with the following
information.
1. Certificate identification number.
2. Total gallons of biodiesel on certificate.
3. Total gallons claimed on Schedule 3 (Form 8849).
4. Total gallons claimed on Schedule C (Form 720), line 13.
How to claim the credit. Any biodiesel or renewable diesel
mixture credit must first be taken on Schedule C to reduce
your taxable fuel liability reported on Form 720. Any excess
credit may be taken on Schedule C (Form 720), Form 8849,
Form 4136, or Form 8864. See Notice 2005-4 and Notice
2005-62 for more information.

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Persons who blend a nontax liquid with taxable fuel to
produce a mixture outside the bulk transfer terminal system
must pay the excise tax on the volume of liquid in the
mixture.
See Form 720 to report these taxes. You also must be
registered with the IRS as a blender. See Form 637,
Application for Registration (For Certain Excise Tax
Activities).
See Claim requirements for each type of
claim.
Total Refund

Amount of Refund

2

Claimant. The person that produced and sold or used the
mixture is the only person eligible to make this claim. The
credit is based on the gallons of alcohol in the mixture.
Claim requirements. The following requirements must be
met.
1. The claim must be for an alcohol fuel mixture sold or used
during a period that is at least 1 week.
2. The amount of the claim must be at least $200. To meet
the minimum, amounts from lines 1, 2, and 3 may be
combined.
3. The claim must be filed by the last day of the first quarter
following the earliest quarter of the claimant’s income tax
year included in the claim. For example, a calendar-year
claimant’s claim for an alcohol fuel mixture sold or used
during June and July must be filed by September 30.
Note. If requirements 1-3 above are not met, see Annual
Claims in the Form 8849 instructions.

Line 3. Alternative Fuel Credit and Alternative Fuel
Mixture Credit (after September 30, 2006)

How to claim the credit. Any alcohol fuel mixture credit
must first be taken on Schedule C to reduce your taxable
fuel liability reported on Form 720. Any excess credit may be
taken on Schedule C (Form 720), Form 8849, Form 4136, or
Form 6478. See Notice 2005-4 and Notice 2005-62 for more
information.

Claim requirements. The following requirements must be
met. 1. You must be registered by the IRS.
2.1. The claim must be for an alternative fuel or alternative fuel
mixture sold or used (as described above under Claimant)
during a period that is at least 1 week.
3.
2. The amount of the claim must be at least $200. To meet
the minimum, amounts from lines 1, 2, and 3 may be
combined.
4.3. The claim must be filed by the last day of the first quarter
following the earliest quarter of the claimant’s income tax
year included in the claim. For example, a calendar-year
claimant’s claim for an alternative fuel mixture sold or used
during June and July must be filed by September 30.

Line 2. Biodiesel or Renewable Diesel Mixture
Credit
Claimant. The person that produced and sold or used the
mixture is the only person eligible to make this claim. The
credit is based on the gallons of biodiesel or renewable
diesel in the mixture.
Claim requirements. The following requirements must be
met.
1. The claim must be for a biodiesel or renewable diesel
mixture sold or used during a period that is at least 1 week.

Claimant. For the alternative fuel credit, the person who sold
an alternative fuel for use in a motor vehicle or a motorboat
or used an alternative fuel in a motor vehicle or a motorboat
is the only person eligible to make this claim. For the
alternative fuel mixture credit, the person that produced and
sold or used the mixture in their trade or business is the only
person eligible to make this claim. The credit is based on the
gallons of alternative fuel in the mixture.

Note. If requirements 1-3 above are not met, see Annual
Claims in the Form 8849 instructions.