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Schedule BIO

INSTRUCTIONS FOR SCHEDULE BIO

Page 2 of 2

(2017)

The biodiesel tax credit is applied against the individual income tax imposed by KRS 141.020 or the corporation income tax imposed by KRS

141.040 and/or the limited liability entity tax (LLET) imposed by KRS 141.0401. The amount of tax credit claimed against the corporation

income tax and LLET can be different.

Purpose of Schedule—The application and credit certification

Part II and Part III

schedule is used to report the number of gallons of biodiesel

produced and/or B100 blended and renewable diesel produced in this

These parts are completed by the Department of Revenue to

state meeting the current ASTM standards. Re–blending of blended

determine the biodiesel credit for each taxpayer. Part III is used

biodiesel does not qualify for this credit. The Department of Revenue

if the total amount of approved credit for all biodiesel producers

will certify the amount of biodiesel credit for each taxpayer. It is

and blenders and renewable diesel producers exceeds the annual

effective for biodiesel produced and/or blended and renewable diesel

biodiesel tax credit cap.

produced on or after January 1, 2008. The taxpayer is not entitled

to the credit for biodiesel produced and/or blended and renewable

Part II—Biodiesel Gallons Approved

diesel produced in another state.

Line 1—This is the amount of biodiesel and renewable diesel

The credit rate is $1 per gallon with a total cap for all taxpayers not

gallons approved by the Department of Revenue for credit. If the

to exceed $10,000,000 annually. There is no carryforward for any

approved credit exceeds the biodiesel tax credit cap, then the credit

unused credit.

is determined by the department in Part III. It is a nonrefundable

credit.

To ensure proper processing, fax or email Schedule BIO to the

Department of Revenue no later than January 15 following the close

of the preceding calendar year. Schedules postmarked or sent after

A pass-through entity must include on each Schedule K-1 the

January 15 are void. Credit certification cannot be guaranteed for

partner’s, member’s, shareholder’s, or beneficiary’s pro rata share

schedules sent through regular mail.

of the approved credit. In addition, a pass-through entity must

notify the department electronically of all partners, members,

Fax number: 502–564–0058

shareholders, or beneficiaries who may claim any amount of the

approved credit. Failure to provide information to the department

Email address:

in the following manner will constitute the forfeiture of available

KRC.WEBResponseEconomicDevelopmentCredits@ky.gov

credits to all partners, members, shareholders, or beneficiaries

in the pass-through entity.

The Department of Revenue will confirm receipt of the application.

If you do not receive confirmation within two weeks of submitting

Email address:

the application, contact the Division of Corporation Tax at

KRC.WEBResponseEconomicDevelopmentCredits@ky.gov

502–564–8139.

The electronic mail must contain a separate attachment in plain

The Department of Revenue will issue the credit certificate, listing

format text or plain ASCII format that includes each partner’s,

the amount of credit available, by April 15 following the close of

member ’s, shareholder ’s, or beneficiary’s: (a) Name; (b)

the preceding calendar year. Attach the credit certificate to the tax

Address; (c) Telephone number; (d) Identification number; and

return claiming the credit.

(e) Distributive share of the tax credit.

General Instructions—Check the appropriate entity type. If the entity

type is not listed, check the “Other” box and list the entity type.

Part III—Biodiesel Approved Credit Certificate

Federal Identification Number—For an individual, enter the

The Department of Revenue determines the total approved

Social Security number; for all other entities, enter the FEIN.

credit. If it exceeds the biodiesel tax credit cap of $10,000,000, the

department will compute each taxpayer’s approved credit based

Testing—The regulation 103 KAR 15:140 provides that a copy of the

upon a fraction, the numerator (Line 1(a)) being the credit approved

laboratory results for July 1 and December 31 of each calendar year

for the taxpayer and the denominator (Line 1(b)) being the total

must be attached to the application, Schedule BIO, submitted to the

credit approved for all taxpayers. The biodiesel tax credit cap is

Department of Revenue. Failure to provide proof of meeting the

multiplied by this fraction to determine each producer’s and/or

ASTM standard on July 1 and December 31 of each calendar year

blender’s approved credit.

with the application will result in the denial of the credit for gallons

of biodiesel or renewable diesel back to the previous testing date of

Part IV—Biodiesel Credit Used By Taxpayer

July 1 or December 31.

Line 1—Enter the amount of credit claimed for the taxable year

Part I—Gallons Produced and/or Blended in Kentucky During the

against the LLET on Schedule TCS, Part II, Column E. The credit

Calendar Year

amount cannot reduce the LLET below the $175 minimum.

Line 1—Enter the number of gallons of B100 biodiesel produced in

Line 2—Enter the amount of credit claimed for the taxable year

this state for the calendar year.

against the corporation income tax on Schedule TCS, Part II,

Column F.

Line 2—Enter the number of gallons of B100 biodiesel used in the

blended biodiesel produced in this state for the calendar year. Re-

Line 3—Enter the amount of credit claimed for the taxable year on

blending of blended biodiesel does not qualify for this credit.

Form 740, 740–NP , or 741.

Line 3—Enter the number of gallons of renewable diesel produced

in this state for the calendar year.

41A720BIO (19JUN17-DRAFT)

Form 41a720bio - Schedule Bio Draft- Application And Credit Certificate Of Income Tax/llet Credit Biodiesel -2017 Page 2

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