Biofuels Distribution Infrastructure Tax Credit

A taxpayer that purchases, constructs, or installs, and places into service a qualified commercial facility for distributing or dispensing biofuels is eligible for an income tax credit of up to 25% for purchase, construction, property, and installation costs. Eligible infrastructure includes pumps, storage tanks, and related equipment used exclusively for distributing, dispensing, and storing biofuels. A qualified facility must clearly label the equipment used to store or dispense the fuel as being associated with biofuel. The credit must be taken in three equal annual installments beginning with the taxable year in which the facility is placed into service. Qualifying fuels include blends containing at least 70% ethanol (E70) dispensed at the retail level for use in motor vehicles, and pure ethanol or biodiesel fuel dispensed by a distributor or facility that blends these non-petroleum liquids with gasoline or diesel fuel for use in motor vehicles.

To claim this credit, the facility must be put into service prior to January 1, 2023. For more information, see the “Application for Renewable Fuels Property Credits (ETC-41)” information on the South Carolina Energy Office Funding website.

(Reference South Carolina Code of Laws 12-6-3610 and House Bill 5150 of 2022)