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Tractor Talk Discussion Forum

waste vegetable oil diesel tax

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bm3501466

04-13-2007 22:16:53




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Does anyone know how to apply for the tax license to make vegetable diesel in OH? I have heard that the if the IRS finds out that you are evading the road tax they will GET you. Has anyone paid this tax and how do you do it? How much goes to state and how much to federal? Are there any biodiesel tax write offs? Any help would be appreciated. Ive tried some research but no one seems to know.




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Gary from Muleshoe

04-14-2007 12:34:40




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 Re: waste vegetable oil diesel tax in reply to bm3501466, 04-13-2007 22:16:53  
I have a friend that is a diesel mechanic and he claims the worst thing you can do to a diesel engine is burn bio-diesel in it. He claims it will cut the life of the engine to half the normal because bio-diesel does not lubricate the engine the way regular diesel. I am no expert or even a little bit knowledgeable of this just thought i would pass this on to you.



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Leland

04-14-2007 20:40:49




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 Re: waste vegetable oil diesel tax in reply to Gary from Muleshoe, 04-14-2007 12:34:40  
the first diesel ran on peanut oil



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jdemaris

04-14-2007 13:38:37




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 Re: waste vegetable oil diesel tax in reply to Gary from Muleshoe, 04-14-2007 12:34:40  
That is true with some types of waste-vegetable-oil i.e. WVO when used for fuel - but the engine life is not affected, just the life of the injection pump. The certified bio-fuels e.g. B90, B100, etc. are blended from selected virgin plant oils. I say selected because some have very good lubricosity - like canola or rapeseed oil. When you burn WVO however, you can select and often have no idea of its content.

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barnrat

04-14-2007 13:03:11




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 Re: waste vegetable oil diesel tax in reply to Gary from Muleshoe, 04-14-2007 12:34:40  
Sorry to rain on your parade but your mechanic is wrong. Properly made bio diesel is better for your engines then regular diesel specifily the new ULS diesel. Have a neighbor farmer that runs b50 to b100 is his old Belarus tractors and 92 Cummins pickup. I've worked on his tractors and I've never seen fuel system and engine componets so clean. He's been using bio diesel for over 3 years now, and no problems.

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mjbrown

04-14-2007 09:30:59




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 Re: waste vegetable oil diesel tax in reply to bm3501466, 04-13-2007 22:16:53  
You are not supposed to drive on the roads with untaxed fuel because that tax pays for the road construction and maintenance. So making your own and useing it on the highway is the same as useing red dyed fuel on the road. Should be no problem useing it in tractors though. While one branch of the government will commend you for makeing and useing renewable less polluting fuel , another branch will haul your butt into court and bust you for it. It's the american way.

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jdemaris

04-14-2007 10:52:54




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 Jimmy Carter says go ahead . . . in reply to mjbrown, 04-14-2007 09:30:59  
I don't know about that. What specific laws are statutes indicate that? And - in regard to road maintenance - we are already paying for it - even without the fuel-tax. In 1979 - Jimmy Carter got federal legislation passed that allows citizens to make a limited amount of "home-brew" motor-fuel and also alcohol for drinking - free of federal taxation. I don't know what ever happened with the home-brew beer and such. But, I believe the federal expemption is still on the books. An individual was - and I think - still is - legally allowed to produce up to 1200 gallons per year - without paying any federal taxes. But - state taxes are different. It was then, and is now - up to each state to tax . . . or not to tax. Some states - at present - do not tax for people running diesels on WVO. Where I live in New York State - for some forms or alternative-energy - it up to each town - for certain tax exemption issues (mostly solar electric and property tax stuff). There are also many more laws and taxes that come into play when selling fuel - and also when modifiying a vehicle to run on alternative fuel. But - not every fuel that is used to run motor-vehicles it taxed - yet. Suppose you burn heating-oil to run a generator - to charge your batteries in your electric car?? Untaxed as far as I know. And, suppose you build a wood-smoke-collector and drive your gas-engine car on firewood? Still untaxed for now. I suppose if you drove to town in your Stanley Steamer - you would not be taxed either. You can read this legal mumbo-jumbo forever - and if you fully understand it all - you are a heck of a lot smarter than I am.

Internal Revenue Service
26 CFR Parts 40, 42, 48, and 602 [TD 8659] RIN 1545-AR92
Gasoline and Diesel Fuel Excise Tax; Registration Requirements
(ii) Exclusion; minor blending. A mixture described in paragraph (c)(1)(i) of this section is not
blended taxable fuel if, during the calendar quarter in which the blender removes or sells the
mixture, all such mixtures removed or sold by the blender contain, in the aggregate, less than
400 gallons of liquid described in paragraph (c)(1)(i)(B) of this section.

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paul

04-14-2007 08:25:54




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 Re: waste vegetable oil diesel tax in reply to bm3501466, 04-13-2007 22:16:53  
The tax collected & the subsidies for building/ producing become very, very, very complicated very quickly. They are very specific for each state. I'm sure you'll get good general ideas here, but you will need a pro to navigate the complex issue for real. Way too complicated.

I believe if you do not sell it, use it yourself, you should not be messed with - but that is based on a couple years old info on my part.....

--->Paul

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jdemaris

04-14-2007 07:12:13




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 Re: waste vegetable oil diesel tax in reply to bm3501466, 04-13-2007 22:16:53  
If you are doing it for yourself - and not selling it - you get a Jimmy Carter exemption for "home-produced" fuel. There is a certain amount of gallons you are allowed to produce and use tax-free - I don't remember exactly what. In reality - who the heck is counting on either end?



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jerry mexico ny

04-14-2007 06:24:38




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 Re: waste vegetable oil diesel tax in reply to bm3501466, 04-13-2007 22:16:53  
Check these sites
communitybiodiesel.org
waldermanufacturing.com
flinthillsdiesel.com
may not be specific to O., but alot of info.
Jerry



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