Biofuels Production Facility Tax Credit

Archived: 10/12/2020

A taxpayer that constructs and places into service a commercial facility for producing biofuel is eligible for a tax credit of up to 25% of the cost of constructing or renovating a building and equipping the facility. Production of biofuel includes intermediate steps such as milling, crushing, and handling feedstock and the distillation and manufacturing of the final product. The entire credit must be taken in seven equal annual installments beginning with the taxable year in which the facility is placed into service. Qualifying fuels include liquid non-petroleum based fuel that can be placed in motor vehicle fuel tanks and be used to operate on-road vehicles, including all forms of fuel commonly or commercially known or sold as biodiesel and ethanol. (Reference South Carolina Code of Laws 12-6-3610)