Using dyed diesel in a pickup truck

MadReferee · Jun 9, 2006

( As far as I know, the taxes are based on gallons purchased. Is there a special method used to calculate the taxes based on miles driven? )

According to the IRS, taxes are based on gallons used. So you have to figure how many gallons of dyed diesel you used and go from there to pay the tax. However, you better have receipts that say you are paying the tax on that fuel because most, if not all, enforcement officials are not going to believe you, especially if you are some distance from your farm.

Some states have farm plates so those vehicles wil be less subject to checks but a personal vehicle can and will be checked. It is your responsibility to prove that you are paying the taxes. Good luck.

MadReferee · Jun 9, 2006

( As far as I know, the taxes are based on gallons purchased. Is there a special method used to calculate the taxes based on miles driven? )

According to the IRS, taxes are based on gallons used. So you have to figure how many gallons of dyed diesel you used and go from there to pay the tax. However, you better have receipts that say you are paying the tax on that fuel because most, if not all, enforcement officials are not going to believe you, especially if you are some distance from your farm.

Some states have farm plates so those vehicles wil be less subject to checks but a personal vehicle can and will be checked. It is your responsibility to prove that you are paying the taxes. Good luck.

cowboydoc · Jun 10, 2006

Mike and Mad you are right on all accounts. The vehicles that do run on the road we take mileage down and yes calculate # of gallons used. Yes the trucks have farm plates. They are treated just like a tractor. If you're using it for farm use you are ok but if it's for private use or to go to the store you need to pay the taxes. Yes we have records of every gallon of fuel used and NO we don't try and cheat anyone. We pay our fair share of taxes when we drive on public roads but we do not pay taxes to drive on our own roads. /forums/images/graemlins/tongue.gif

cowboydoc · Jun 10, 2006

Mike and Mad you are right on all accounts. The vehicles that do run on the road we take mileage down and yes calculate # of gallons used. Yes the trucks have farm plates. They are treated just like a tractor. If you're using it for farm use you are ok but if it's for private use or to go to the store you need to pay the taxes. Yes we have records of every gallon of fuel used and NO we don't try and cheat anyone. We pay our fair share of taxes when we drive on public roads but we do not pay taxes to drive on our own roads. /forums/images/graemlins/tongue.gif

cp1969 · Jun 10, 2006

So let me get this straight...You and all other farmers are on the honor system? That is a provision of the law?

What forms do you have to submit or is the tablet you keep in each truck good enough for the Feds?

cp1969 · Jun 10, 2006

So let me get this straight...You and all other farmers are on the honor system? That is a provision of the law?

What forms do you have to submit or is the tablet you keep in each truck good enough for the Feds?

DaveNay · Jun 10, 2006

( So let me get this straight...You and all other farmers are on the honor system? That is a provision of the law?

What forms do you have to submit or is the tablet you keep in each truck good enough for the Feds? )

Well, it sure seems like IRS form 720, No 60, Line (b) provides the proper location to claim taxable uses of untaxed fuel.

DaveNay · Jun 10, 2006

( So let me get this straight...You and all other farmers are on the honor system? That is a provision of the law?

What forms do you have to submit or is the tablet you keep in each truck good enough for the Feds? )

Well, it sure seems like IRS form 720, No 60, Line (b) provides the proper location to claim taxable uses of untaxed fuel.

dmccarty · Jun 12, 2006

Ah, if you ain't a wage slave then most taxes are an honor system.

I have filled out an IRS form a couple of times over the years to get back road taxes used on fuel that went into my tractor and Stihls. Did not amount to much but what the heck, I get back what I can. Its just a form so its the honor system until the IRS audits me and asks for proof of puchase of those gallons. I have a log book that I use to track my fuel use and MPG. The log has date, gallons bought, cost, mpg, miles driven on the tank, and how many miles on the truck. If I buy fuel for the off road equipment I list it for the tractor. Lately I have been a slacker on listing how much gas my DR Mower uses. But I could justify a write off by the number of hours on the machine. It burns about 1 gallon per hour.....

Later,
Dan

cowboydoc · Jun 12, 2006

You're on the honor system until you get audited or checked on the road. Then you dang well better be on the truth system or you will get fined. You're also on the honor system to follow the rules of the land. Nobody is there everyday to look over your shoulder and hold your hand to make sure you do the right thing and they aren't with farmers and ranchers either. 99% of life is the honor system. We do our duty to God and country and I sleep well at night so that is all the more I have to say on it.