Tax season is upon us, and before filing taxes, learn what benefits your landscaping business qualifies for.
Did you know there’s potentially very valuable, often overlooked tax benefit specific to landscaping businesses? This benefit is called a federal fuel tax credit and it’s designed to help landscaping businesses leverage the cost of fuel spent on lawn mowing equipment throughout the year.
The Federal Fuel Tax Credit
The federal government (and most states) add a special tax to ALL fuel purchased at retail gas stations. This “fuel tax” is used to pay for the maintenance of roads, bridges and public transportation systems. The federal fuel tax is 18.4 cents on each gallon of gas and 24.4 cents on each gallon of diesel.
Businesses that use fuel for “off-highway” purposes (i.e. in equipment not meant to travel on roads or highways, such as lawnmowers, blowers, etc.) are eligible for a 100% refund of fuel taxes in the form of a fuel tax credit. Like a tax deduction, the fuel tax credit (alternatively called a fuel tax refund) can only be claimed when you file your federal income taxes, generally at the end of the year.
Federal Fuel Tax Credit Eligibility
Unless your business buys “dyed diesel” (non-taxed diesel fuel), you pay federal fuel taxes and are therefore eligible for a 100% refund of these taxes on the fuel used in your off-road equipment.
Filing for the Federal Fuel Tax Credit
The federal fuel tax credit can be claimed by using IRS Form 4136, “Credit for Fuel Tax Paid on Fuels”. Though fuel receipts are not required, the IRS will require you to keep a detailed log of all fuel purchased and used for off-highway, business purposes.
What This Means for Small Businesses
In our experience, the average amount owed to most small business landscapers is about $700. Sadly, each year about 1 billion dollars in federal fuel tax credits go unclaimed. Don’t let this be you. It’s your money- claim it!
Claim It Easily
You can file a return yourself using online resources, the help of your accountant or use an app like FuelCred that can help you streamline the whole process. FuelCred is a mobile app that helps landscaping businesses keep track of their fuel purchases and automates the process of claiming the federal fuel tax for your landscaping business. Filing a fuel tax return using FuelCred normally costs $100, however, if you are a TaskEasy contractor, you can get 60% of the original price. Sign-up to be a TaskEasy Contractor today and we'll send you a special promo code to use at checkout.
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About TaskEasy
TaskEasy provides landscape contractors with ready-to-service, high margin residential and commercial routes along with innovative software that helps reduce drive time, manage multiple crews, automate invoicing and customer support for free. TaskEasy’s patent-pending formula establishes fair market pricing for yard care services in statistical metropolitan areas in all 50 U.S. states. This means customers and contractors don’t have to haggle on price and can instead focus on quality service delivery. Since its consumer launch in April 2013, TaskEasy has performed over one million tasks in over 12,000 cities across the U.S. and has established a network of more than 10,000 screened and rated contractors. The company is headquartered in Salt Lake City, Utah. For more information, please visit www.TaskEasy.com
About FuelCred
FuelCred was founded to help small businesses succeed. The company, whose founders all come from farming families who ran small businesses, sits at the intersection of "Big 4" tax and accounting, technology, and innovation. For more information please visit fuelcred.com.
