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Special Alerts

Louisiana Alternative Fuel Tax Credit

To our Clients:

As many of you are now aware, the state of Louisiana enacted R.S. 47:6035 on July 9, 2009, which allowed a refundable credit for: a portion of the cost of property which is directly related to the delivery of an alternative fuel tank of motor vehicles propelled by alternative fuel, including compression equimpment, storage tanks and dispensing units for alternative fuel at the point where the fuel is delivered, provided the property is installed and located in this state and no credit has been previously claimed on the cost of such property, and excluding any costs associated with the exploration or development activities; the conversion of a vehcile to a qualified clean-burning motor vehicle fuel property; or the purchase of a new qualified motor vehicle with a qualified clean burning fuel property installed by the manufacturer.  The purchased vehicle was required to be properly registred with the Louisiana Department of Public Safety.  Most taxpayers who have taken this credit did so based on the purchase of a new alternative fuel burning vehicle (Flex Fuel), and were allowed a credit equal to the lesser of 10% of the cost of the vehicle, or $3,000.

This statue was effective on July 9, 2009 and was applicable to amounts paid after January 1, 2009.  In reponse to the number of returns filed claiming this credit and the questions raised regarding the credit, on April 30, 2012, the Louisiana Department of Revenue issued an Emergency Rule regarding the administration of this tax credit and to clarify the statute and provide guidance as to the availability and proper qualification criteria necessary to claim the creidt.  On May 3, 2012 Revenue Inforamtion Bulletin No. 12-025 was issued in response to frequently asked questions for claiming the credit.  On May 4, 2012, Revenue Information Bulletin No. 12-026 was issued amending some of the answers provided in RIB 12-025.  Finally, on June 14, 2012, Governor Jindal rescinded the April 30 Emergency Ruel, and stated that the Department of Revenue will grant refund requests postmarked on or before June 14, 2012, and will begin the rule-making process to determine the proper scope of the alternative fuel tax credit.  The Department also stated that they will honor any refunds previously paid based on the existing statute.

What does this mean for you?

If you, or your Company, purchased Flex Fuel, Compressed Natural Gas, or any other qualifying vehicles capable of being powered by an alternative fuel between January 1, 2009 and December 31, 2011, and we have already filed your tax return(s) for those years and did not claim the credit, please consider filing amended returns for those years.  If the state repeals the statute allowing the credits available for alternative fuel vehicles and equipment, there may be an opportunity to take the credit for the period between June 14, 2012 and the date the law is repealed.  If an amended return has not been filed by the date of the repeal, there will be no opportunity to receive the credit.  If you plan to purchase a vehicle, or purchased a vehicle in 2012 based on the premise that you would receive a state credit up to $3,000, we do not believe the Department of Revenue will uphold the current law, but will repeal it, or further restrict it to vehicles that burn only alternative fuels, not both gasoline and alternative fuels.

If you are interested in amending any applicable returns to claim this credit, which may not ever be recognized by the Department, please provide the following information:

  • Vehicle registeration
  • Purchase invoice
  • Window sticker, if available
  • Alternative Fuel Credit information provided by Dealer, if available

If you converted a vehicle registered in the state of Louisiana to burn a qualified alternative fuel during this period referenced above, please provide the following information:

  •  Vehicle registration
  •  Proof of the cost of the installation of the conversion kit by a technician of qualified clean-burning motor vehicle fuel property certified by the United States Enviromental Protection Agency

If you installed equipment to store and deliver alternative fuels to your vehicle(s), please provide the following information:

  •  Invoices for the cost of the delivery of the equipment
  •  A statement that no prior credit has been taken in association with the purchase of the delivery equipment
  •  Proof that the equipment is located in the state of Louisiana

If you decide to amend a previously filed return to apply for the credit for the purchase of an alternative fuel vehicle, or to claim the credit for the conversion of a vehicle to burn alternative fuel, or for equipment to store and dispense alternative fuels, there will be a fee for filing the amended return(s).  This fee will not be refunded if the credit is not allowed or denied, and will be determined by the amount of time spent on amending the Louisiana tax returns for eqch year the credit could be claimed under the original statute.

Sincerely,

Young & Bell