Biofuel Commercial Production and Commercial Use Credit: Biofuel Commercial Production and Commercial Use Credit (2024)
Maine · Maine Revenue Services · Used for tax years 2024
This worksheet calculates Maine’s Biofuel Commercial Production and Commercial Use Tax Credit for tax year 2024. It reports income from certified biofuel production, eligible gallons, the credit calculated at $0.05 per gallon, and unused credits carried forward from prior years.
Who files this form
Use this worksheet to claim the credit for producing certified biofuel in Maine. For the 2024 credit, the biofuel must have been produced in tax year 2024, meet state and federal regulatory requirements, and be certified by the Maine Department of Environmental Protection (DEP).
Owners of pass-through entities, such as partnerships, LLCs, S corporations, and trusts, may claim a credit in proportion to their ownership interests.
Enclose the worksheet with Form 1040ME, Form 1040C-ME, Form 1041ME, or Form 1120ME, whichever applies.
What you'll need
- A completed credit worksheet with your name and EIN or SSN.
- A copy of the DEP certification showing the quantity of eligible biofuel produced. Submit it with the income tax return claiming the credit.
- Your applicable Maine income tax return, including the taxable income and gross tax liability figures needed to calculate the credit.
- If claiming through a pass-through entity, a copy of the federal Schedule K-1 issued to you, plus the entity's name, EIN or SSN, and your ownership percentage for the tax year.
- Any unused credit amount carried forward from prior years that remains within the 10-year limit.
Maine Revenue Services (MRS) may request additional information supporting the credit before processing the return.
How to file
- Apply to DEP for biofuel certification. For certification requirements and applications, call the Bureau of Air Quality, Mobile Sources Section at (207) 287-6102, or visit maine.gov/dep/air, select Programs, then Mobile Sources.
- Complete the worksheet. Enter eligible Maine taxable income on line 1. For line 2, divide the gross tax liability on your return by the taxable income on your return. Multiply lines 1 and 2 for line 3.
- Enter the certified gallons on line 4, adjusted for your ownership percentage if claiming through a pass-through entity. Multiply by the $0.05 rate on line 5 to calculate line 6. Add eligible carryforward credit on line 7 to get line 8.
- Enter the smaller of line 3 or line 8 on line 9. Report that amount on the applicable return worksheet or schedule:
- Form 1040ME, Schedule A, Lines 7 and 19 Other Tax Credits Worksheet, line 13.
- Form 1040C-ME, Schedule A, line 12.
- Form 1041ME, Schedule A, line 17.
- Form 1120ME, Schedule C, line 1l.
- Enclose the worksheet and a copy of the DEP certification with your income tax return. Attach your federal Schedule K-1 if claiming through a pass-through entity.
The text does not provide a mailing address or e-file instructions.
Common mistakes
- Forgetting to submit a copy of the DEP certification with the return claiming the credit.
- Claiming the full quantity of a blend. Only the biofuel portion of a blend with petroleum or other non-biofuels qualifies.
- Claiming more than your ownership share of a pass-through entity's credit, or omitting the entity information, ownership percentage, or federal Schedule K-1.
- Using the credit, including carryovers, to reduce the applicable tax liability below zero.
- Including unused credits beyond the limit of 10 taxable years following the year the credit was generated.
MRS may request additional supporting information before your return can be processed.
Questions people ask
How much is the credit?
The credit is $0.05 per gallon of eligible certified biofuel. It applies against tax on income derived from producing that biofuel and cannot reduce that tax liability below zero.
Does blended fuel qualify?
When certified biofuel is blended with petroleum or other non-biofuels, only the portion that is biofuel qualifies for the credit.
Who certifies the biofuel?
The Commissioner of DEP certifies eligible biofuel. You must apply to DEP and submit a copy of the certification with the income tax return claiming the credit.
Can I carry unused credit forward?
Yes. Unused credit may be carried forward for up to 10 taxable years following the year it was generated and applied against tax liability on income derived from producing biofuel.
How do pass-through entity owners calculate their share?
Owners are allowed a credit in proportion to their ownership interests. On line 1, include only the entity's certified biofuel income included in your Maine taxable income. On line 4, multiply the certified gallons by your ownership percentage.
Official sources
All versions of Biofuel Commercial Production and Commercial Use Credit