U.S. Individual Income Tax Return

Form

8864

OMB No. 1545-1924

Biodiesel and Renewable Diesel Fuels Credit
©

Department of the Treasury
Internal Revenue Service

2008

Attach to your tax return.

Attachment
Sequence No.

141

Identifying number

Name(s) shown on return

Caution.

You cannot claim any amounts on Form 8864 that you claimed (or will claim) on Schedule C (Form 720), Form 8849,
or Form 4136.
Claimant has a certificate from the producer or importer of biodiesel or renewable diesel reported on lines 1 through 8 below and, if
applicable, claimant also has a statement from the reseller. Claimant has no reason to believe that the information in the certificate or
statement is false. Claimant may need to attach a copy of the certificate and statement. See Certification below.
(a)
Number of Gallons
Sold or Used

Type of Fuel

1

Biodiesel (other than agri-biodiesel) produced, or sold or
used, before 2009

1

$ .50

2
3
4

$1.00
$1.00
$1.00

2

Biodiesel (other than agri-biodiesel) produced, and sold or
used, after 2008

3
4

Agri-biodiesel
Renewable diesel

5

Biodiesel (other than agri-biodiesel) included in a biodiesel
5
mixture produced, or sold or used, before 2009
Biodiesel (other than agri-biodiesel) included in a biodiesel
6
mixture produced, and sold or used, after 2008
7
Agri-biodiesel included in a biodiesel mixture
8
Renewable diesel included in a renewable diesel mixture
9
Qualified agri-biodiesel production
Add lines 1 through 9. Include this amount in your income for 2008 (see instructions)

6
7
8
9
10
11
12

13
14

(b)
Rate

(c)
Column (a) x Column (b)

$ .50
$1.00
$1.00
$1.00
$ .10
10

Biodiesel and renewable diesel fuels credit from partnerships, S corporations, cooperatives,
estates, and trusts (see instructions)

11

Add lines 10 and 11. Cooperatives, estates, and trusts, go to line 13; partnerships and
S corporations, report this amount on Schedule K; all others, report this amount on Form 3800,
line 1l
Amount allocated to patrons of the cooperative or beneficiaries of the estate or trust (see
instructions)

12

Cooperatives, estates, and trusts. Subtract line 13 from line 12. Report this amount on Form 3800,
line 1l

General Instructions
Section references are to the Internal Revenue Code.

What’s New
1. For credits claimed on returns filed after May 14,
2008, biodiesel and renewable diesel do not include
fuel produced outside the United States or a U.S.
possession for use as a fuel outside the United States
or a U.S. possession.
2. For fuel produced, and sold or used, after October
3, 2008, renewable diesel does not include any fuel
derived from co-processing biomass with feedstock
that is not biomass.
3. For fuel produced after 2008, biodiesel and
renewable diesel do not include any liquid eligible for
the alcohol and cellulosic biofuel fuels credit (Form
6478).
4. For fuel produced, and sold or used, after 2008:
a. The credit rate for the biodiesel and biodiesel
mixture credits increases to $1.00 per gallon.
b. Camelina is added to the list of virgin oils from
which agri-biodiesel is derived.
For Paperwork Reduction Act Notice, see instructions.

13
14

c. The definition of renewable diesel changed (see
Renewable Diesel).
5. Biodiesel produced, sold, or used after April 1,
2009, must meet the new ASTM D6751 cold soak
filtration test (see Biodiesel).

Purpose of Form
Use Form 8864 to figure your biodiesel and renewable
diesel fuels credit. Claim the credit for the tax year in
which the sale or use occurs. This credit consists of
the:
●
●
●
●
●

Biodiesel credit,
Renewable diesel credit,
Biodiesel mixture credit,
Renewable diesel mixture credit, and
Small agri-biodiesel producer credit.

Definitions and Special Rules
Certification
To claim a credit on lines 1 through 8, you generally
must attach the Certificate for Biodiesel and, if
applicable, Statement of Biodiesel Reseller, to Form
Cat. No. 25778F

Form

8864

(2008)

Form 8864 (2008)

8864. To claim a credit on lines 4 or 8, the certificate
must indicate at all appropriate locations that the fuel
to which it relates is renewable diesel and state that
the fuel meets the requirements discussed under
Renewable Diesel below. However, if the certificate or
statement was attached to a previously filed claim,
attach a separate sheet with the following information.
● Certificate identification number.
● Total gallons of agri-biodiesel, biodiesel other than
agri-biodiesel, or renewable diesel on the certificate.
● Total gallons claimed on Schedule 3 (Form 8849).
● Total gallons claimed on Schedule C (Form 720).
● Total gallons claimed on Form 4136.
See Notice 2005-62, 2005-35 I.R.B. 443, or Pub.
510, Excise Taxes, for the model certificate and
statement.
Biodiesel
Biodiesel means the monoalkyl esters of long chain
fatty acids derived from plant or animal matter which
meet the registration requirements for fuels and fuel
additives established by the Environmental Protection
Agency (EPA) under section 211 of the Clean Air Act,
and the requirements of the American Society of
Testing and Materials (ASTM) D6751.
Biodiesel produced, sold, or used on or before April
1, 2009, must meet the requirements of ASTM D6751
as in effect either before or after October 13, 2008.
Biodiesel produced, sold, or used after April 1, 2009,
must meet the new requirements of ASTM D6751
adding the cold soak filtration test (see section 2(c) of
Notice 2008-110, 2008-51 I.R.B. 1298).
Biodiesel includes both agri-biodiesel and biodiesel
other than agri-biodiesel. Biodiesel does not include:
● For credits claimed on returns filed after May 14,
2008, fuel produced outside the United States or a
U.S. possession for use as a fuel outside the United
States or a U.S. possession.
● For fuel produced after 2008, any liquid that is eligible
for the alcohol and cellulosic biofuel fuels credit (Form
6478).
Agri-Biodiesel
Agri-biodiesel means biodiesel derived solely from
virgin oils, including esters derived from virgin
vegetable oils from corn, soybeans, sunflower seeds,
cottonseeds, canola, crambe, rapeseeds, safflowers,
flaxseeds, rice bran, mustard seeds, and (for fuel
produced, and sold or used, after 2008) camelina, and
from animal fats.
Renewable Diesel
For fuel produced, or sold or used, before 2009,
renewable diesel means diesel fuel derived from
biomass (defined below) using a thermal
depolymerization process which meets the registration
requirements for fuels and fuel additives established by
the EPA under section 211 of the Clean Air Act, and
the requirements of the ASTM D975 or D396. Thermal
depolymerization processes use heat and pressure,
with or without the presence of catalysts. For details,
see Notice 2007-37, 2007-17 I.R.B. 1002.

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2

For fuel produced, and sold or used, after 2008,
renewable diesel means liquid fuel derived from
biomass (defined below) that meets the registration
requirements for fuels and fuel additives established by
the EPA under section 211 of the Clean Air Act, and
the requirements of the ASTM D975 or D396, or other
equivalent standard approved by the IRS, or a
Department of Defense specification for military jet fuel
or an ASTM specification for aviation turbine fuel. For
aviation uses, treat kerosene as diesel fuel when
figuring a renewable diesel mixture credit.
Renewable diesel does not include:
● For credits claimed on returns filed after May 14,
2008, fuel produced outside the United States or a
U.S. possession for use as a fuel outside the United
States or a U.S. possession.
● For fuel produced, and sold or used, after October
3, 2008, any fuel derived from co-processing biomass
with feedstock that is not biomass.
● For fuel produced after 2008, any liquid eligible for
the alcohol and cellulosic biofuel fuels credit (Form
6478).
Biomass. Biomass means any organic material other
than oil and natural gas (or any product thereof) and
coal (including lignite) or any product thereof.
Biodiesel and Renewable Diesel Credits
The biodiesel or renewable diesel reported on lines 1
through 4 must not be a mixture. The credits are for
biodiesel or renewable diesel which during the tax year
you:
● Used as a fuel in a trade or business, or
● Sold at retail to another person and put in the fuel
tank of that person’s vehicle.
However, no credit is allowed for fuel used in a trade
or business that was purchased in a retail sale
described above.
Caution. You may be liable for a 24.4 cents per gallon
excise tax on biodiesel or renewable diesel you sold (in
your trade or business) for use or used in a
diesel-powered highway vehicle or diesel-powered
train. Report the tax liability on Form 720 on the line
for IRS No. 79 for the quarter in which the biodiesel
was sold or used or IRS No. 60(b) for the quarter in
which the renewable diesel was sold or used.
Biodiesel and Renewable Diesel Mixture Credits
The biodiesel or renewable diesel reported on lines 5
through 8 must be used to make a qualified mixture. A
qualified mixture combines biodiesel or renewable
diesel with diesel fuel (defined below), determined
without regard to any use of kerosene. But treat the
kerosene as diesel fuel when figuring a renewable
diesel mixture credit for certain aviation fuel (see
Renewable Diesel above). The producer of the mixture
either:
● Used it as fuel, or
● Sold it as fuel to another person.
The credit is available only to the producer of the
mixture. The producer must use or sell the mixture in a
trade or business and the credit is available only for
the year the mixture is sold or used. The credit is not
allowed for casual off-farm production of a qualified
mixture.

Form 8864 (2008)

Caution. You may be liable for a 24.4 cents per gallon
excise tax on biodiesel or renewable diesel used to
produce blended taxable fuel outside the bulk transfer
terminal system if the mixture is diesel fuel. Report the
tax liability on Form 720 on the line for IRS No. 60(c)
for the quarter in which the mixture was sold or used.
Diesel fuel. Diesel fuel means:
● Any liquid that, without further processing or blending,
is suitable for use as a fuel in a diesel-powered highway
vehicle or diesel-powered train, and
● Transmix.
A liquid is suitable for this use if the liquid has
practical and commercial fitness for use in the
propulsion engine of a diesel-powered highway vehicle
or diesel-powered train. A liquid may possess this
practical and commercial fitness even though the
specified use is not the liquid’s predominant use.
However, a liquid does not possess this practical and
commercial fitness solely by reason of its possible or
rare use as a fuel in the propulsion engine of a
diesel-powered highway vehicle or diesel-powered
train. Diesel fuel does not include gasoline, kerosene,
excluded liquid, No. 5 and No. 6 fuel oils covered by
ASTM specification D396, or F-76 (Fuel Naval Distillate)
covered by military specification MIL-F-16884.
An excluded liquid is any liquid that (a) contains less
than 4% normal paraffins, or (b) has a (i) distillation
range of 125°F or less, (ii) sulfur content of 10 parts
per million or less, and (iii) minimum color of +27
Saybolt. For example, biodiesel is always an excluded
liquid because it does not contain paraffins. But a
biodiesel mixture may not be an excluded liquid.
Transmix means a by-product of refined products
created by the mixing of different specification
products during pipeline transportation.
Qualified Agri-Biodiesel Production
Qualified agri-biodiesel production means up to 15
million gallons of agri-biodiesel which is produced by
an eligible small agri-biodiesel producer (defined
below), and which during the tax year:
1. Is sold by such producer to another person:
a. For use by such person in the production of a
qualified biodiesel mixture in such other person’s trade
or business (other than casual off-farm production),
b. For use by such person as a fuel in a trade or
business, or
c. Who sells such agri-biodiesel at retail to another
person and places such agri-biodiesel in the fuel tank
of such other person, or
2. Is used or sold by such producer for any purpose
described in (1).
Note. Production of renewable diesel is not qualified
agri-biodiesel production.
Eligible small agri-biodiesel producer. An eligible
small agri-biodiesel producer is a person who, at all
times during the tax year, has a productive capacity for
agri-biodiesel not in excess of 60 million gallons.
Aggregation rule. All members of the same controlled
group of corporations (see section 267(f)) and all
persons under common control (see section 52(b) but

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treat an interest of more than 50% as a controlling
interest) are treated as 1 person for purposes of the 15
and 60 million gallon limits.
Partnership, S corporation, and other pass-through
entities. The 15 and 60 million gallon limits discussed
above are applied at both the entity level and at the
partner or similar level.
Registration
All producers and importers of biodiesel or renewable
diesel must be registered with the IRS. All persons
producing blended taxable fuel must be registered. See
Form 637, Application for Registration (For Certain
Excise Tax Activities).
Coordination With Excise Tax Credit
Only one credit may be taken with respect to any
amount of biodiesel or renewable diesel. If any amount
is claimed (or will be claimed) with respect to any
amount of biodiesel or renewable diesel on Form 720,
Quarterly Federal Excise Tax Return, Form 8849, Claim
for Refund of Excise Taxes, or Form 4136, Credit for
Federal Tax Paid on Fuels, then a claim cannot be
made on Form 8864 for that amount of biodiesel or
renewable diesel.
Recapture of Credit
You must pay a tax on each gallon of biodiesel or
renewable diesel on which a credit was claimed at the
rate used to figure the credit if you:
● Use it (including a mixture) other than as a fuel,
● Buy it at retail and use it to create a mixture,
● Separate it from a mixture, or
● Use agri-biodiesel on which the small agri-biodiesel
producer credit was claimed for a use not described
under Qualified Agri-Biodiesel Production above.
Report the tax on Form 720, Quarterly Federal Excise
Tax Return.

Additional Information
See Pub. 510, Excise Taxes.

Specific Instructions
Use lines 1 through 10 to figure any biodiesel and
renewable diesel fuels credit from your own trade or
business.
Skip lines 1 through 10 if you are claiming only a
credit that was allocated to you from a pass-through
entity (that is, an S corporation, partnership, estate,
trust, or cooperative).
Line 10
Include this amount in income, under “other income”
on the applicable line of your income tax return, even if
you cannot use all of the credit because of the tax
liability limit. However, if you are subject to alternative
minimum tax (AMT), this amount is not income in
computing AMT and must be subtracted when figuring
your alternative minimum taxable income. Do this by
including this amount on line 27 of Form 6251, line 23
of Schedule I (Form 1041), or line 2o of Form 4626.

Form 8864 (2008)

Line 11
If you are allocated a small agri-biodiesel producer
credit from a pass-through entity, the entity must tell
you the number of gallons for which it claimed the
credit and its productive capacity for agri-biodiesel.
You, as a shareholder, partner, beneficiary, or patron,
are subject to the 15 million gallon limitation for line 9
and the 60 million gallon productive capacity limitation
for an eligible small agri-biodiesel producer.
Line 13
A cooperative, estate, or trust allocating the small
agri-biodiesel credit must give the patron or beneficiary
a statement providing them with the number of gallons
for which it claimed the credit and its productive
capacity for agri-biodiesel. An estate or trust must also
provide the amount of the small agri-biodiesel credit
included as part of the pass-through credit. See the
above instructions for line 11.
Cooperatives. A cooperative described in section
1381(a) can elect to allocate any part of the small
agri-biodiesel producer credit among the patrons of
the cooperative. The credit is allocated among the
patrons eligible to share in patronage dividends on the
basis of the quantity or value of business done with or
for such patrons for the tax year.
The cooperative is deemed to have made the
election by completing line 13. However, the election is
not effective unless (a) made on a timely filed return
(including extensions) and (b) the organization
designates the apportionment in a written notice
mailed to its patrons during the payment period
described in section 1382(d).
If you timely file your return without making an
election, you can still make the election by filing an
amended return within 6 months of the due date of the
return (excluding extensions). Enter “Filed pursuant to
section 301.9100-2” on the amended return.
Once made, the election cannot be revoked.

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Estates and trusts. Allocate the biodiesel and
renewable diesel fuels credit on line 12 between the
estate or trust and the beneficiaries in the same
proportion as income was allocated and enter the
beneficiaries’ share on line 13.
Paperwork Reduction Act Notice. We ask for the
information on this form to carry out the Internal
Revenue laws of the United States. You are required to
give us the information. We need it to ensure that you
are complying with these laws and to allow us to figure
and collect the right amount of tax.
You are not required to provide the information
requested on a form that is subject to the Paperwork
Reduction Act unless the form displays a valid OMB
control number. Books or records relating to a form or
its instructions must be retained as long as their
contents may become material in the administration of
any Internal Revenue law. Generally, tax returns and
return information are confidential, as required by
section 6103.
The time needed to complete and file this form will
vary depending on individual circumstances. The
estimated burden for individual taxpayers filing this
form is approved under OMB control number
1545-0074 and is included in the estimates shown in
the instructions for their individual income tax return.
The estimated burden for all other taxpayers who file
this form is shown below.
Recordkeeping
8 hrs., 36 min.
Learning about the
law or the form
57 min.
Preparing and sending the form
to the IRS
2 hrs., 20 min.
If you have comments concerning the accuracy of
these time estimates or suggestions for making this
form simpler, we would be happy to hear from you.
See the instructions for the tax return with which this
form is filed.