- 5 -
Petitioner argues that it is entitled to the fuel tax
credits at issue because it followed all instructions on Form
4136, Credit for Federal Tax Paid on Fuels, for claiming the
credits, and the farmers to whom petitioner provided services
never claimed or intended to claim credits for petitioner’s use
of fuel on their farms as evidenced by the parties’ agreements,
invoices, payments for services, and waivers.
Discussion
Section 34(a)(1) allows a credit against Federal income tax
for the taxable year in an amount equal to the sum of the amounts
payable to the taxpayer under section 6420 with respect to
gasoline used during the taxable year on a farm for farming
purposes (determined without regard to section 6420(g)). Under
section 6420(a), the “ultimate purchaser” of the gasoline is
entitled to a credit determined by multiplying the number of
gallons used by the rate of tax applied to the gasoline on the
date he purchased the gasoline.
Except as provided in section 6420(c)(4), gasoline is
considered to have been used for farming purposes only if used by
the owner, tenant, or operator of a farm for various farming
purposes. See sec. 6420(c)(3). The owner, tenant, or operator
of a farm generally is treated as the user and ultimate purchaser
of gasoline used for the farming purposes described in section
6420(c)(3)(A). See sec. 6420(c)(4)(A). Section 6420(c)(4),
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 Next
Last modified: May 25, 2011