Publication 378 |
2000 Tax Year |
Off-Highway Business Use
A credit or refund may be allowed for the excise tax on fuel used
for an off-highway business use.
Off-highway business use is any use of fuel in a trade or business
or in an income-producing activity. It does not include use in a
highway vehicle registered or required to be registered for use on
public highways. Do not consider any use in a boat as an off-highway
business use.
Off-highway business use includes fuels used in any of the
following ways.
- In stationary machines such as generators, compressors,
power saws, and similar equipment.
- For cleaning purposes.
- In forklift trucks, bulldozers, and earthmovers.
Generally, it does not include nonbusiness, off-highway use of
fuel, such as use by minibikes, snowmobiles, power lawn mowers, chain
saws, and other yard equipment.
Example.
Joanna owns a landscaping business. She uses power lawn mowers and
chain saws in her business. The gasoline used in the power lawn mowers
and chain saws qualifies as fuel used in an off-highway business use.
The gasoline used in her personal lawn mower at home does not qualify.
Highway vehicle.
A highway vehicle is any self-propelled vehicle designed to carry a
load over public highways, whether or not it is also designed to
perform other functions. Examples of vehicles designed to carry a load
over public highways are passenger automobiles, motorcycles, buses,
and highway-type trucks and truck tractors. A vehicle is a highway
vehicle even though the vehicle's design allows it to perform a
highway transportation function for only one of the following.
- A particular type of load, such as passengers, furnishings,
and personal effects (as in a house, office, or utility
trailer).
- A special kind of cargo, goods, supplies, or materials.
- Some off-highway task unrelated to highway transportation,
except as discussed next.
Vehicles not considered highway vehicles.
Generally, the following kinds of vehicles are not considered
highway vehicles.
- Specially designed mobile machinery for nontransportation
functions. A self-propelled vehicle is not a highway vehicle if all
the following apply.
- The chassis has permanently mounted to it machinery or
equipment used to perform certain operations (construction,
manufacturing, drilling, mining, timbering, processing, farming, or
similar operations) if the operation of the machinery or equipment is
unrelated to transportation on or off the public highways.
- The chassis has been specially designed to serve only as a
mobile carriage and mount for the machinery or equipment, whether or
not the machinery or equipment is in operation.
- The chassis could not, because of its special design and
without substantial structural modification, be used as part of a
vehicle designed to carry any other load.
- Vehicles designed for off-highway transportation. A
self-propelled vehicle is not a highway vehicle if both of the
following apply.
- The vehicle is designed primarily to carry a specific kind
of load other than over the public highway for certain operations
(construction, manufacturing, mining, processing, farming, drilling,
timbering, or similar operations).
- The vehicle's use in carrying this load over public highways
is substantially limited or impaired because of its design. To make
this determination, you may take into account whether the vehicle can
travel at regular highway speeds, requires a special permit for
highway use, or is overweight, overheight, or overwidth for regular
highway use.
Public highway.
A public highway includes any road in the United States that is not
a private roadway. This includes federal, state, county, and city
roads and streets.
Registered.
A vehicle is considered registered when it is registered or
required to be registered for highway use under the law of any state,
the District of Columbia, or any foreign country in which it is
operated or situated. Any highway vehicle operated under a dealer's
tag, license, or permit is considered registered. A highway vehicle is
not considered registered solely because a special permit allows the
vehicle to be operated at particular times and under specified
conditions.
Dual use of propulsion motor.
Off-highway business use does not include any fuel used in the
propulsion motor of a registered highway vehicle even though that
motor also operates special equipment by means of a power take-off or
power transfer. It does not matter if the special equipment is mounted
on the vehicle.
Example.
The motor of a registered concrete-mixer truck operates both the
engine and the mixing unit by means of a power take-off. The fuel used
in the motor to run the mixer is not used in an off-highway business
use.
Use in separate motor.
Off-highway business use includes fuel used in a separate motor to
operate special equipment, such as a refrigeration unit, pump,
generator, or mixing unit. If you draw fuel from the same tank that
supplies fuel to the propulsion motor, you must figure the quantity
used in the separate motor operating the special equipment. You may
make a reasonable estimate based on your operating experience and
supported by your records.
You can use devices that measure the miles the vehicle has traveled
(such as hubometers) to figure the gallons of fuel used to propel the
vehicle. Add to this amount the fuel consumed while idling or warming
up the motor before propelling the vehicle. The difference between
your total fuel used and the fuel used to propel the vehicle is the
fuel used in the separate motor.
Example.
Sara owns a refrigerated truck. It has a separate motor for the
refrigeration unit. The same tank supplies both motors. Using the
truck's hubometer, Sara figures that 90% of the fuel was used to
propel the truck. Therefore, 10% of the fuel is used in an off-highway
business use.
Fuel lost or destroyed.
You cannot treat fuel lost or destroyed through spillage, fire, or
other casualty as fuel used in an off-highway business use.
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