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R. Klein, EA
R. Klein, EA, Enrolled Agent
Category: Tax
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Experience:  Over 20 Years experience
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Can I receive a state or federal (or both) tax deduction for

Resolved Question:

Can I receive a state or federal (or both) tax deduction for having a CNG (i.e., Compressed Natural Gas) conversion kit put on my truck in the state of Oklahoma? I am doing a bi-fuel conversion and not a dedicated CNG conversion.
Submitted: 4 years ago.
Category: Tax
Expert:  R. Klein, EA replied 4 years ago.

Randall Klein EA :

There are some tax advantages, but we would need more information from you.

Randall Klein EA :

What type of vehicle is this? Is this a commercial truck?

Randall Klein EA :

Who made the conversion kit?

Randall Klein EA :

Many of the tax benefits expired in 2010, but there are a few remaining federal credits depending on whether the conversion is certified by the government or not. If this is a home-conversion, then there is no federal credit available.

Customer:

No, it would be for personal use. However, I have a farm non-tax number and I could get a farm tag and declare my truck for farm usuage if necessary. I currently own a 2006 Toyota Tacoma truck and may have the CNG conversion put on it. I am currently looking at purchasing a 2012 Ram 1500 Laramie Longhorn truck and would like to put the CNG conversion on that truck when purchased later this year. The conversion kit is through Energy and Water Solutions in Utah.

Randall Klein EA :

For Oklahoma, you would need to have a vehicle that was not previously driven to qualify a conversion in order to qualify for a credit.

Randall Klein EA :

The company you mentioned is not on the approved federal government list.

Randall Klein EA :

Oklahoma has a credit up to $1500

Customer:

So if I purchase a new truck and then have the conversion put on I would qualify? However, it would have to be an EPA certified conversion? Oklahoma Energy Management Systems out of Okarche, Oklahoma does these conversions, would they qualify and how much for federal?

Randall Klein EA :

This would not qualify for a federal credit at this time. For Oklahoma, you get a credit of 10% of the incremental cost for the alternate fuel system, not to exceed $1500 in credits

Randall Klein EA :

Companies that meet the federal guidelines include Cummins, Freightliner, Thomas Buses, Daimler, Roush, and about a dozen smaller companies

Customer:

Thank you sir, I believe that you answered all of my concerns. Is there anything pending, as far as possible tax credits for CNG in the near future?

Randall Klein EA :

CNG is not where the government is hedging their alternative energy bets. So I doubt anything will chnage in the near future.

Randall Klein EA :

They are pushing electric above all others.

Customer:

Thank you again for your help and have a great day! :)

Randall Klein EA :

Have a great day. If I have been of assistance today, please Accept my answer.

Customer:

Will do!

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