SC SCH TC 40: Ethanol or Biodiesel Production Credit (Revision 2020-06)
South Carolina · South Carolina DOR · Used for tax years 2024, 2025, 2026
South Carolina Schedule TC-40 calculates the Ethanol or Biodiesel Production Credit for individual or corporate income tax. It reports the credit approved by the South Carolina Energy Office, current-year tax liability, and the allowable credit, which is the lesser of those amoun
Who files this form
SC SCH.TC-40 is for individuals and corporations claiming the Ethanol or Biodiesel Production Credit. Complete a separate form for each facility, and apply to the South Carolina Energy Office (SCEO) before claiming any credit.
For tax years beginning January 1, 2017, the instructions describe a credit for qualifying new ethanol or biodiesel production. New production includes:
- Production from a new facility.
- Production from a facility that did not receive credits before 2017.
- An expansion of an existing facility's capacity by at least 2 million gallons, first placed in service after 2016.
The design engineer must certify the gallons to the SCEO, which approves the new production credit based on production records.
When it's due
- January 31 following the credit year: Submit your request to the SCEO for the year for which you are claiming the credit. Include the total gallons of qualifying fuel produced in the previous calendar year.
- March 1 of that same application year: The SCEO will issue its response.
The approved credit can be claimed for the tax year that includes December 31 of the previous calendar year. The text does not state an Income Tax return filing deadline.
What you'll need
Have the following information and records ready:
- Your name and SSN or FEIN. Individual taxpayers must provide their Social Security Number.
- The credit amount allowed by the SCEO and your current-year tax liability.
- The SCEO's written certification.
- Total gallons of qualifying fuel produced in the previous calendar year for your SCEO request.
- Production records supporting the new production credit and the design engineer's certification of gallons to the SCEO.
The SCDOR and SCEO may request to examine records relating to the credit.
How to file
- Apply to the SCEO before claiming the credit. Information about applying is available at energy.sc.gov.
- Complete a separate TC-40 for each facility. Enter the SCEO-approved credit on line 1 and your current-year tax liability on line 2.
- Enter the smaller of those amounts on line 3 as your allowable credit.
- Individuals enter the credit on SC1040TC. Corporations enter it on SC1120TC.
Paper filing: Attach TC-40 and the SCEO's written certification to your Income Tax return.
Electronic filing: Keep a copy with your tax records.
The text does not provide a mailing address.
Common mistakes
- Claiming a credit before applying to the SCEO.
- Combining multiple facilities on one TC-40 instead of completing a separate form for each.
- Entering more than the smaller of the SCEO-approved credit and current-year tax liability on line 3.
- Leaving out TC-40 or the SCEO's written certification when filing a paper return.
- Failing to keep a copy with your tax records when filing electronically.
- Omitting your Social Security Number if you are an individual taxpayer.
Questions people ask
What is the new production credit rate?
For tax years beginning January 1, 2017, the instructions state a rate of 7.5 cents per gallon of ethanol or biodiesel, before denaturing, for qualifying new production for no more than 36 consecutive months.
Can I claim the entire amount approved by the SCEO?
Line 3 limits your allowable credit to the smaller of the SCEO-approved amount or your current-year tax liability.
Can I use one form for several facilities?
No. Complete a separate TC-40 for each facility.
Where can I learn more about applying for approval?
The form directs taxpayers to energy.sc.gov for information about applying to the SCEO.