1 Recent Developments Regarding the Treatment of Refundable Fuel Tax Credits August 5, 2014 Michael E. Fincher Deloitte Tax LLP
2 Tax Accounting for Certain Renewable Fuel Incentives Technical tax issue: whether to exclude from gross income (including grossing up excise tax deductions or cost of goods sold (COGS)) refundable excise tax credits allowed for Ethanol or other alcohol fuel mixtures (section 6426(b)) Biodiesel mixtures (section 6426(c)) Alternative fuels (e.g., propane)(section 6426(d)) Alternative fuel mixtures (section 6426(e)) Many in the industry directly included the credit/payment amount in federal taxable income, or did so indirectly by reducing excise tax deductions or COGS for those amounts. 2 Treatment of Refundable Fuel Tax Credits Copyright 2014 Deloitte Development LLC. All rights reserved.
3 Section 6426 Fuel Tax Credits CCA credits and related payments not items of gross income But CCA deduction not allowed for excise taxes against which credits were applied under section 6426(a) Taxpayers currently challenging IRS s position on deductibility issue, which may impact only a portion of their credits claimed Section 6426(b) credits for ethanol or other alcohol fuel mixtures sold or used during 1/1/05 through 12/31/11 Section 6426(c) credits for biodiesel mixtures sold or used during 1/1/05 through 12/31/13 Section 6426(d) credits for alternative fuels (e.g., propane) used to propel motor vehicles, motorboats, or airplanes if sold or used during 10/1/06 through 12/31/13 (or through 9/30/14 for liquefied hydrogen) Section 6426(e) credits for alternative fuel mixtures sold or used during 10/1/06 through 12/31/11 (or through 12/31/09 for black liquor) Possible opportunity to amend open-year returns and request refunds, and/or to increase NOL carryforwards from closed years Some credits may be reinstated by Congress for 2014 and beyond 3 Treatment of Refundable Fuel Tax Credits Copyright 2014 Deloitte Development LLC. All rights reserved.
4 Additional Considerations Financial and tax accounting treatment often differ by taxpayer Note: Excise tax rules treat single-member LLCs as separate taxpayers If benefits are effectively passed through to customers, net accounting may have been used Excise taxes originally treated as similar to sales tax collections (i.e., collection and remittance - see ASC and former EITF 06-03) Netting of credits and discount paid to customer Consider gross-up approach for amended returns Claiming a deduction for full excise tax liability as if liability was satisfied by refundable credits will likely be challenged by the IRS 4 Treatment of Refundable Fuel Tax Credits Copyright 2014 Deloitte Development LLC. All rights reserved.
5 Presenter Bio Michael E. Fincher Senior Manager Michael Fincher is a Senior Manager in the Minneapolis office of Deloitte Tax LLP, with over 13 years of experience assisting clients in the area of corporate and cooperative taxation. He specializes in cooperative taxation and corporation reorganizations and consolidations (including mergers and acquisitions, spin-offs, liquidations, and dispositions). During his career with Deloitte, Michael spent two years in the National Tax office of Deloitte, located in Washington, D.C., as part of a Management Development Program assignment in the Subchapter C Group. In addition to his client responsibilities, Michael leads Deloitte sponsored training seminars in the area of corporate reorganizations, mergers and acquisitions, and accounting periods and methods at the local, regional, and national level on a regular basis. In addition, Michael is an adjunct professor at the University of Minnesota, Carlson School of Business, where he teaches the corporate consolidated returns course in the Master of Business Taxation program. Michael is a member of the American Institute of Certified Public Accountants, the Tax Committee of the National Society of Accountants for Cooperatives, and he is a licensed certified public accountant in the District of Columbia and the states of Minnesota and South Dakota. Michael holds a Masters of Science in Taxation degree from American University (Washington, D.C.), a Masters of Professional Accountancy degree, and a Bachelors of Science in Business Administration degree, both from the University of South Dakota. 5 Treatment of Refundable Fuel Tax Credits Copyright 2014 Deloitte Development LLC. All rights reserved.
6 This presentation contains general information only and Deloitte is not, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication. 6 Treatment of Refundable Fuel Tax Credits Copyright 2014 Deloitte Development LLC. All rights reserved.
7 About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Copyright 2014 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited
Multistate Tax State Tax Matters August 21, 2015 In this issue: Articles: A Roadmap of How One Governor Used Economic Development to Create a New Virginia Economy: Part Two... 1 Income/Franchise: Alabama:
Big data The three-minute guide Don t squint. Select the full-screen option to view at full size. Big Data The three-minute guide 1 2 What is big data? It s about insight Big data generally refers to datasets
Moving beyond the pill Increasing consumer engagement through retail pharmacy services The pharmacy business is undergoing dramatic changes. Fueled by health care reform, increasing competition, and shrinking
New section 1411 regulations answer a number of questions Taxpayers receive some favorable guidance in the final regulations interpreting the 3.8 percent net investment income tax Prepared by: Ed Decker,
Life Accounts Receivable Financing Accounts Receivable Financing A Planning Strategy for Business Owners Producer Guide These materials are not intended to be used to avoid tax penalties, and were prepared
STATE OF NORTH DAKOTA BEFORE THE COMMISSIONER OF INSURANCE In the Matter of the Application of ) FINDINGS OF FACT, Pioneer Mutual Life Insurance Company ) CONCLUSIONS OF LAW, AND to Reorganize Into and
ALBANY AMSTERDAM ATLANTA BOCA RATON BOSTON CHICAGO DALLAS DELAWARE DENVER FORT LAUDERDALE HOUSTON LAS VEGAS LOS ANGELES MIAMI NEW JERSEY NEW YORK ORANGE COUNTY ORLANDO PHILADELPHIA PHOENIX SACRAMENTO SILICON
225 DEBT WORKOUTS: THE PARTNERSHIP AND THE PARTNERS James B. Sowell KPMG LLP 2012 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated
White Paper Life Insurance Coverage on a Key Employee www.selectportfolio.com Toll Free 800.445.9822 Tel 949.975.7900 Fax 949.900.8181 Securities offered through Securities Equity Group Member FINRA, SIPC,
Advanced Sales White Paper: Using Life Insurance as an Asset in Qualified Retirement Plans July, 2012 Number 19-1 February 1, 2014 Contact us: AdvancedSales@voya.com Employees and business owners alike
White Paper: Using Cash Value Life Insurance for Retirement Savings www.selectportfolio.com Toll Free 800.445.9822 Tel 949.975.7900 Fax 949.900.8181 Securities offered through Securities Equity Group Member
The Sale of Structured Settlements in Minnesota Structured Settlements The term structured settlement is defined in Minnesota statutes as an arrangement: for the periodic payment of damages for personal
A Guide To STArTinG A BuSineSS in MinneSoTA Small Business Assistance Office Minnesota Department of employment and economic Development A Guide To S TA r T in G A Bu S in e SS in M in n e S o TA is updated
July 2015 CONTENTS When are expenses deductible? What s deductible? Office rent/home office expenses Special considerations for ownermanagers Planning to maximize tax breaks Special situations Documentation
GENERAL SERVICES ADMINISTRATION Federal Supply Service Authorized Federal Supply Schedule Price List On-line access to contract ordering information, terms and conditions, up-to-date pricing, and the option
January 2015 Please read this important information carefully. Schwab One Account Agreement Information about your: Schwab One Account Schwab StockBuilder Plan Schwab One International Account Contents
business owner issues and depreciation deductions Individuals who are owners of a business, whether as sole proprietors or through a partnership, limited liability company or S corporation, have specific
issue 13 2013 Complimentary article reprint The future of health care insurance: What s ahead? By paul keckley, Bill Copeland and greg scott > Illustration by igor morski About Deloitte Deloitte refers
FE-555 (Revised) Estate Planning in North Dakota: THE BASICS Gifts, Life Insurance and Annuities Debra Pankow, Ph.D., Family Economics Specialist NDSU Extension Service Michael Sadler, Law School Student
Canada Introduction Liability to Canadian tax is determined by residence status for taxation purposes and the source of income derived by an individual. Income tax is levied at progressive rates on a person
Partnership Form M3 Instructions 2014 What s New for 2014 Factor Percentages have Changed The property, payroll, and sales factors on Schedule M3A have changed. Beginning in tax year 2014 and beyond, Minnesota
IT-541i (1/15) General Information and Instructions for Completing Form IT-541 Fiduciary Income Tax Return Who Must File A Return Louisiana Revised Statute (R.S.) 47:162 provides that every resident estate
State of California Franchise Tax Board FTB Publication 1067 Guidelines for Filing a Group Form 540NR Contents Purpose... 1 Terms Used in this Publication... 1 General Information... 1 Introduction....