Are You Tracking Gasoline Costs?

The South Carolina Infrastructure and Economic Development Reform Act was enacted last year. This included a motor fuel user fee increase of 2 cents per gallon beginning July 2017, with additional 2 cent increases in July of each year for the next five years, to help pay for transportation system repairs and improvements. To help offset the impact of this on residents, a refundable motor fuel income tax credit has been enacted.

This is a refundable tax credit

This applies to all resident South Carolina taxpayers. This tax credit will be filed with your South Carolina 2018 tax return (in 2019) on Form I-385 and is refundable (the credit will, if it exceeds your tax burden, be refunded to you), but you need to be thinking ahead to take advantage of it.

Eligible vehicles

Eligible vehicles include passenger cars, minivans, sport utility vehicles, pickup trucks (of a certain weight), and motorcycles. Up to two vehicles per taxpayer are eligible, but they have to be registered in South Carolina in the name of the taxpayer (for example, a married couple filing jointly can claim the refund for up to four vehicles as long as they’re not all registered in the name of only one spouse).

Save receipts from all fuel and maintenance expenses

The credit is calculated from the lesser of either fuel expenses or preventative maintenance costs (things like new tires and oil changes) incurred in 2018. Proper documentation is required, so save those receipts and invoices. Business owned vehicles are eligible in certain cases, so contact us for more information if this applies to you.

How are you doing?

Are you keeping track of fuel and vehicle maintenance expenses for the year? If you need assistance in planning for next year’s tax filing, we are happy to help. We have 24 years of experience in working with local taxpayers and we can be reached at (803) 325-1444 or through our website.