Form 8896
(Rev. December 2019)
Department of the Treasury
Internal Revenue Service
Low Sulfur Diesel Fuel Production Credit
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Attach to your tax return.
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Go to www.irs.gov/Form8896 for the latest information.
OMB No. 1545-1914
Attachment
Sequence No.
142
Name(s) shown on return Identifying number
1 Low sulfur diesel fuel produced (in gallons) . . . . . . . . . . . . . . . . . . . . 1
2 Multiply line 1 by $0.05 . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3 Qualified costs limitation (see instructions) . . . . . . . . . . . . . . . . . . . . 3
4 Total low sulfur diesel fuel production credits allowed for all prior tax years (see instructions) . . . 4
5 Subtract line 4 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . 5
6 Enter the smaller of line 5 or line 2 . . . . . . . . . . . . . . . . . . . . . . . 6
7 Low sulfur diesel fuel production credit from partnerships, S corporations, and cooperatives (see
instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7
8
Add lines 6 and 7. Cooperatives, go to line 9. Partnerships and S corporations, stop here and report
this amount on Schedule K. All others, stop here and report this amount on Form 3800, Part III,
line 1m . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8
9 Amount allocated to patrons of the cooperative (see instructions) . . . . . . . . . . . .
9
10 Cooperatives, subtract line 9 from line 8. Report this amount on Form 3800, Part III, line 1m . . .
10
General Instructions
Section references are to the Internal Revenue Code unless
otherwise noted.
Future Developments
For the latest information about developments related to Form
8896 and its instructions, such as legislation enacted after they
were published, go to www.irs.gov/Form8896.
Purpose of Form
Use Form 8896 to claim the low sulfur diesel fuel production
credit.
The credit generally is 5 cents for every gallon of low sulfur
diesel fuel produced by a qualified small business refiner during
the tax year. However, the total credits allowed for all tax years
cannot be more than the refiner’s qualified costs limitation on
line 3. This credit is part of the general business credit.
Partnerships, S corporations, and cooperatives must file this
form to claim the credit. All other taxpayers are not
required to complete or file this form if their only source for this
credit is a partnership, S corporation, or cooperative.
Instead, they can report this credit directly on line 1m in Part III
of Form 3800, General Business Credit.
Definitions
Low Sulfur Diesel Fuel
This is diesel fuel with a sulfur content of 15 parts per million or
less.
Small Business Refiner
A small business refiner generally is a refiner of crude oil with an
average daily domestic refinery run or average retained
production for all facilities that did not exceed 205,000 barrels
for the 1-year period ending on December 31, 2002. To figure
the average daily domestic refinery run or retained production,
only include refineries that were refineries of the refiner or a
related person (within the meaning of section 613A(d)(3)) on
April 1, 2003. However, a refiner is not a small business refiner
for a tax year if more than 1,500 individuals are engaged in the
refinery operations of the business on any day during the tax
year.
Qualified Costs
For each facility, qualified costs are costs paid or incurred to
comply with the highway diesel fuel sulfur control requirements
of the Environmental Protection Agency (EPA) during the period
beginning January 1, 2003, and ending on the earlier of:
• The date 1 year after the date on which the refiner must
comply with these EPA requirements with respect to such
facility; or
• December 31, 2009.
Qualified costs include costs for the construction of new
process operation units or the dismantling and reconstruction
of existing process units to be used in the production of low
sulfur diesel fuel, associated adjacent or offsite equipment
(including tankage, catalyst, and power supply), engineering,
construction period interest, and site work.
In addition, the small business refiner must obtain certification
from the IRS (which will consult with the EPA) that the
taxpayer’s qualified costs will result in compliance with the
applicable EPA regulations. This certification must be obtained
not later than June 29, 2008, or, if later, the date that is 30
months after the first day of the first tax year in which the credit
is determined. For details, see Rev. Proc. 2007-69, 2007-49
I.R.B. 1137, available at
www.irs.gov/irb/2007-49_IRB#RP-2007-69.
TIP
Unless you elect not to take this credit, your
deductions will be reduced by the amount of your
credit. For details, see section 280C(d).
Additional Information
For more information, see section 45H.
Specific Instructions
Use lines 1 through 6 to figure any low sulfur diesel fuel
production credit from your own trade or business.
Line 1
Enter the number of gallons of diesel fuel produced with a sulfur
content of 15 parts per million or less.
For Paperwork Reduction Act Notice, see instructions.
Cat. No. 37704F
Form 8896 (Rev. 12-2019)