Clean Fuel Tax deduction

[Mark Smith]

There has been a posting about the Sport Trac qualifying for the clean fuel deduction.

Today I got my refund back. The IRS did allow the deduction. I got the extra $300

I printed the tax forms and filled them out the old fashion way, by hand.

Now that always throws up a red flag with the IRS. When we had a small business I also did them by hand too. Another red flag. I took every deduction that I could. Never had a problem with the IRS.

I read all the instructions in the IRS instruction book, and just took them as I understood them. I took a large deduction for starting a HSA account which the IRS did question. It was approved after they checked with the bank that I started the HSA with.

The clean fuel deduction was not even questioned. I bought my 2005 ST in May 2005.



I have read here at myst.com that other members have also taken this deduction in 2004 with no problems.



I can't understand why if you even use tax software it allows this deduction also, but someone else says that their tax account says it can't be taken. :wacko:



Mark S

 

[shawn stonbraker 2]

Yeah that was me Mark. It wasn't only my accountant though. I also called the IRS and talked to an "agent" and pretty much argued with him and still was told no. Congrats on getting it but it looks like I'm out the $300. Oh well.

 

[Robert Stanton]

According to the IRS's definitions of clean fuels, the following are clean-burning fuels:

- Natural gas

- Liquefied natural gas

- Liquefied petroleum gas

- Hydrogen

- Electricity

- Any other fuel that is at least 85% alcohol (any kind) or ether (such as our STs)



The IRS website singles out certain models of cars that do qualify for the clean-fuel deduction (Ford Escape Hybrid, Honda Accord Hybrid, Honda Insight, Honda Civic Hybrid, Lexus RX 400h, Mercury Mariner Hybrid, Toyota Highlander Hybrid, and Toyota Prius) because these are NOT qualifying vehicles for the Electric Vehicle Credit (a different type of deduction).



I'm no tax law expert, but this is what I found in my investigations. It sounds to me like the tax accountant who said this deduction can't be taken on an ST didn't investigate the issue well enough.



Edit - I can't address what the IRS agent told you, stonemiser. Maybe the website information is incorrect or misleading and we shouldn't actually be taking the deduction... but I got mine too.

 

[TracN Jack]

Question is Which VIN code indicate that your ST IS Clean fuel? or FlexFuel?



or do all ST qualify? If i have a ST that is 2002 and have not used the credit can i now? etc

 

[Mark Smith]

Only the 2004 & 2005 ST are flex fuel and you have to buy it new.

 

[Richard L]

TracNJack,

If you look inside your hood the emmissions sticker will clearly say if it is a Flex-Fuel engine.



Bahb,

I agree with you 100%. The Sport Trac with the Flex-Fuel engine is a legal Clean Fuel deduction. Dozens of members here have taken the deduction and got their $300. I have not heard of any person who was denied that deductable or even had the deduction questioned.



It a proven fact that if you call the IRS with a tax question, the answer they give you will be wrong at least 60% of the time, especially if you are asking about a deduction. I think their theory is, if you have to ask, you have doubts. And if you have doubt, you should not take the deduction.



All the Tax preparation manuals and book that i have read about Federal Income Taxes all say that if you feel you are entitled to take a deduction you should take it. The worst that can happen is the IRS will not allow it, and you will have to pay the taxes, and you can even object and fight them and not be considered a criminal.



...Rich

 

[Gypsy me]

Makes perfect sense to me.