At TiP Excise, we work with a range of companies in varying sectors and industries to ensure that our clients don’t leave money on the table when it comes to their federal and state taxes. One demographic that can benefit from our expertise the most is companies that utilize refrigerated trucks.
Refrigerated trucks can play a role in multiple sectors – from florists that make daily deliveries to food and beverage suppliers that require refrigerated trucks to deliver fresh goods around the country. Therefore, when it comes to the federal excise tax on refrigerated trucks, there’s a good chance that your business deserves a refund.
So, how does the excise tax process work, and how do you know if your unique company will qualify for a refund?
The process starts by understanding the mechanics of the excise tax and how you can benefit from an experienced resource like TiP at your side.
What is Excise Tax?
Excise tax is a tax that almost all Americans pay every day when they purchase products or services. Unlike a sales tax, which is tacked on to the price of a product, an excise tax is built into the cost of the product. Therefore, most folks don’t realize they are paying this virtually hidden tax when they make a purchase.
Excise tax is applied to a finite range of products, including alcohol, tobacco, and fuel. As of 2023, the federal excise tax on fuel was 18.3 cents per gallon of gasoline and 24.3 cents per gallon on diesel fuel. However, these taxes are subject to change in any given year.
In addition to federal excise taxes, states have their own excise taxes, which are also applied to the cost of fuel. These state taxes can vary widely. For example, the excise tax on gasoline in Pennsylvania is $0.611 per gallon, while in Mississippi, the excise tax on gas is $0.18 per gallon. Additionally, like federal excise taxes, these rates can also change regularly. As such, it takes an expert in this unique area of federal tax law to understand the excise tax rates and how a business can gain a refund on the fuel that they use every day.
How Does the Excise Tax Refund Apply to Refrigerated Trucks?
All businesses require fuel to provide transportation, but just because a company uses fuel, doesn’t necessarily mean they qualify for an excise tax refund.
The excise tax refund can only be applied for fuel used for non-highway transportation or other purposes. For example, construction companies may be able to claim a tax refund on fuel that is used to power generators at off-road work sites. At the same time, landscapers may be able to claim a refund on the fuel that is used to power lawnmowers and lawn maintenance equipment.
Therefore, when it comes to companies that use refrigerated trucks, it’s the fuel utilized in creating a climate controlled environment that can make a difference.
Simply put, if your company uses any fuel to operate the refrigeration unit or refrigerated trailer to conduct business, then you will qualify for a fuel excise tax refund.
What Type of Refrigerated Truck Operations May Qualify for a Fuel Excise Tax Refund?
There are a range of companies that should investigate their options when it comes to receiving a refund on the fuel, they use every day to conduct business.
These types of businesses or operations include the following:
- Food and grocery providers – Food suppliers that require refrigeration to deliver goods to grocery stores, restaurants, and other vendors are exceptional candidates for a fuel excise tax refund.
- Florists and landscapers – Companies that require refrigeration in order to keep flowers, plants, and other greenery alive and fresh can also benefit from exploring their excise tax refund options.
- Medical suppliers – Some medical supply companies may require refrigeration in order to keep medicines safe, making them a candidate for a fuel excise tax refund.
- Alcohol or beverage providers – Like food service providers, supplies that provide alcohol and other beverages in a climate-controlled environment may qualify for a fuel excise tax refund.
- Beauty companies, artwork, antique specialists, and more – While the above list includes some of the top candidates, there is a range of industries and companies that may qualify for a refund. Simply put, if refrigeration or providing a climate-controlled environment is a cornerstone of your business operations, it’s time to explore your excise tax refund options.
Can I Claim the Fuel Tax Credit?
If the scenarios above apply to your business, then you likely qualify for a fuel excise tax refund. Best of all, if you have never claimed a refund before, you may be able to go back in time (up to three years) to secure the biggest refund possible.
However, there are some challenges when it comes to researching and obtaining a fuel excise tax refund. Tax law is always changing and evolving, and even the most professional CPAs and in-house accountants may not be familiar with the hurdles and guidelines that accompany this unique area of federal and state taxes.
Partner with the Tax Specialists at TiP Excise
At TiP, we concentrate solely on excise tax and understand the fundamentals and details that may apply to securing your biggest refund possible. We do not receive any fees or compensation until we have secured your refund, and we’ll only receive a minor percentage of your total refund, which means that you can rest assured that exploring your excise tax options can only be a profitable venture.
We only need a little information from you to get started on putting money back into your pocket, and even if you didn’t keep detailed records of every fuel expense, we can still boost your bottom line.
Reach out to us today to get started, and put your hard-earned money back into your pocket, with the experts of TiP guiding the way to the largest excise tax refund possible.