If you own a lawn care, fertilization or weed control business, you probably spend thousands each year on fuel for sprayers,
spreaders and other off-road equipment. Did you know you may be entitled to get those fuel taxes back?
What Is the Fuel Tax Credit?
The IRS Fuel Tax Credit lets business owners claim back federal taxes paid on fuel that’s used for off-road business activities — like running your lawn treatment equipment. It is not available to most taxpayers, but most lawn care and weed control companies qualify.
Fuel uses that qualify for the fuel tax credit:
- Fuel for ride-on sprayers & spreaders.
- Fuel for small engines for mixing or spraying chemicals.
- Fuel for other power equipment used on client properties.
Fuel uses that do not qualify for the fuel tax credit:
- Fuel for your personal car or truck.
- Fuel for commuting.
- Fuel for mowing your personal lawn.
- Fuel for vehicles registered for use on public roads (even if you use them off-road sometimes).
Diesel users can claim the credit only on un-dyed diesel (also known as clear diesel). Dyed diesel is already tax exempt,
so there’s no extra credit for that.
It’s important to confirm your eligibility and keep good records. The penalty for an incorrect claim will cost you $5,000.
How To Claim the Fuel Tax Credit
- Track how many gallons of fuel you purchase and use for off-road business activities.
- Keep clear records. It’s smart to track fuel separately for off-road equipment.
- Complete IRS Form 4136 — this form lists all eligible fuels and uses.
- Sign the Statement Supporting Fuel Tax Credit (FTC) Computation – 1 to confirm you qualify.
- Submit both forms with your return.
Pro Tip: Stay organized! Don’t toss receipts in a shoebox — use QuickBooks or Dext to save receipts digitally, and use our free Fuel Tax Credit Calculator & Off-Road Fuel Purchase Log to calculate your potential savings and track your eligible purchases.
DOWNLOAD: Fuel Tax Credit Calculator & Off-Road Fuel Purchase Log
Take advantage of the Fuel Tax Credit today to stop overpaying for fuel and put those tax dollars back into your lawn care business.
Need help filing? Contact PCO Bookkeepers & M&A Specialists today.
