Deductions for Clean-Fuel Vehicle and Refueling Property You are allowed a limited deduction for the cost of clean-fuelvehicle property. You are also allowed a limited deduction for thecost of clean-fuel vehicle refueling property. These deductions areallowed only in the tax year you place the property in service. You cannot claim these deductions for the part of a property's costthat you claim as a section 179 deduction. Nonqualifying property.You cannot claim these deductions for property used in thefollowing ways. Predominantly outside the United States. Predominantly to furnish lodging or in connection with thefurnishing of lodging. By certain tax-exempt organizations. By governmental units or foreign persons or entities. Clean-burning fuels.The following are clean-burning fuels. Natural gas. Liquefied natural gas. Liquefied petroleum gas. Hydrogen. Electricity. Any other fuel that is at least 85% alcohol (anykind) or ether. Deduction for Clean-FuelVehicle Property France accommodationThe deduction for this property may be claimed regardless ofwhether the property is used in a trade or business. Clean-fuel vehicle property.Clean-fuel vehicle property is either of the following kinds ofproperty. A motor vehicle produced by an original equipmentmanufacturer and designed to be propelled by a clean-burning fuel. Theonly part of a vehicle's basis that qualifies for the deduction is thepart attributable to: A clean-fuel engine that can use a clean-burningfuel, The property used to store or deliver the fuel to theengine, or The property used to exhaust gases from the combustion ofthe fuel. Any property installed on a motor vehicle (includinginstallation costs) to enable it to be propelled by a clean-burningfuel if: The property is an engine (or modification of an engine)that can use a clean-burning fuel, or The property is used to store or deliver that fuel to theengine or to exhaust gases from the combustion of that fuel. For vehicles that may be propelled by both a clean-burning fuel andany other fuel, your deduction is generally the additional cost ofpermitting the use of the clean-burning fuel. Caution: Clean-fuel vehicle property does not include an electric vehiclethat qualifies for the electric vehicle credit discussed later. Motor vehicle defined.A motor vehicle is any vehicle that has four or more wheels and ismanufactured primarily for use on public streets, roads, and highways.It does not include a vehicle operated exclusively on a rail or rails. Qualified property.For your property to qualify for the deduction: It must be acquired for your own use and not forresale, Its original use must begin with you, and Either-- The motor vehicle of which it is a part must satisfy anyfederal or state emissions standards that apply to each fuel by whichthe vehicle is designed to be propelled, or It must satisfy any federal and state emissionscertification, testing, and warranty requirements that apply. However, see Nonqualifying property, earlier. Deduction limit.The maximum deduction you can claim for qualified clean-fuelvehicle property with respect to any motor vehicle is: $50,000 for a truck or van with a gross vehicle weightrating over 26,000 pounds or for a bus with a seating capacity of atleast 20 adults (excluding the driver), $5,000 for a truck or van with a gross vehicle weight ratingover 10,000 pounds but not more than 26,000 pounds, or $2,000 for a vehicle not included in (1) or (2). Deduction for Clean-FuelVehicle Refueling Property For your property to qualify for this deduction: It must be depreciable property, and Its original use must begin with you. However, see Nonqualifying property, earlier. Clean-fuel vehicle refueling property.Clean-fuel vehicle refueling property is any property (other than abuilding or its structural components) used to do either of thefollowing. Store or dispense a clean-burning fuel into the fuel tank ofa motor vehicle propelled by the fuel, but only if the storage ordispensing is at the point where the fuel is delivered into thetank. Recharge motor vehicles propelled by electricity, but onlyif the property is located at the point where the vehicles arerecharged. For the definition of a motor vehicle, see Deduction forClean-Fuel Vehicle Property, earlier. Recharging property.This property includes any equipment used to provide electricity tothe battery of a motor vehicle propelled by electricity. It includeslow-voltage recharging equipment, high-voltage (quick) chargingequipment, and ancillary connection equipment such as inductivecharging equipment. It does not include property used to generateelectricity, such as solar panels or windmills, and does not includethe battery used in the vehicle. Deduction limit.The maximum deduction you can claim for clean-fuel vehiclerefueling property placed in service at one location is $100,000. Tofigure your maximum deduction for any tax year, subtract from $100,000the total you (or any related person or predecessor)claimed for clean-fuel vehicle refueling property placed in service atthat location for all earlier years. Caution: If the deduction limit applies, you must specify on your tax returnthe property (and portions of the property's cost) that you are usingas a basis for the deduction. Related persons.For this purpose, related persons include the following persons. An individual and his or her brothers and sisters,half-brothers, half-sisters, spouse, ancestors, and linealdescendants. An individual and a corporation when the individual owns,directly or indirectly, more than 50% in value of the outstandingstock of the corporation. Two corporations that are members of the same controlledgroup as defined in section 267(f) of the Internal RevenueCode. A grantor and a fiduciary of any trust. Fiduciaries of two separate trusts if the same person is agrantor of both trusts. A fiduciary and a beneficiary of the same trust. A fiduciary and a beneficiary of two separate trusts if thesame person is a grantor of both trusts. A fiduciary of a trust and a corporation when the trust or agrantor of the trust owns, directly or indirectly, more than 50% invalue of the outstanding stock of the corporation. A person and a tax-exempt educational or charitableorganization that is controlled directly or indirectly by that personor by members of the family of that person. A corporation and a partnership if the same persons own morethan 50% in value of the outstanding stock of the corporation and morethan 50% of the capital or profits interest in the partnership. Two S corporations or an S corporation and a regularcorporation if the same persons own more than 50% in value of theoutstanding stock of each corporation. A partnership and a person owning, directly or indirectly,more than 50% of the capital or profits interest in thepartnership. Two partnerships if the same persons own, directly orindirectly, more than 50% of the capital or profits interest in bothpartnerships. An executor of an estate and a beneficiary of the estate,except in the case of a sale or exchange in satisfaction of apecuniary bequest. To determine whether an individual directly or indirectly owns anyof the outstanding stock of a corporation, see Ownership ofstock, under Related Persons, in Publication 538. How To Claimthe Deductions How you claim the deductions for clean-fuel vehicles and refuelingproperty depends on the use of the property and the kind of income taxreturn you file. Nonbusiness use of clean-fuel vehicle property byindividuals.Individuals can claim the deduction for the nonbusiness use ofclean-fuel vehicle property by including the deduction in the total online 32 of Form 1040. Also, enter the amount of your deduction and"Clean-Fuel" on the dotted line next to line 32. If you use thevehicle partly for business, see the next two discussions. Business use by employees.Employees who use clean-fuel vehicle property for business, orpartly for business and partly for nonbusiness purposes, shouldinclude the entire deduction in the total on line 32 of Form 1040.Also, enter the amount of your deduction and "Clean-Fuel" on thedotted line next to line 32. Business use by sole proprietors.Individuals who operate a business as a sole proprietor must claimtheir deduction for the business use of clean-fuel vehicles andclean-fuel vehicle refueling property on the Other expensesline of either Schedule C (Form 1040) or Schedule F (Form 1040).If clean-fuel vehicle property is used partly for nonbusinesspurposes, claim the nonbusiness part of the deduction as explainedearlier under Nonbusiness use of clean-fuel vehicle property byindividuals. Partnerships.Partnerships claim the deduction for the business use of clean-fuelvehicle and clean-fuel vehicle refueling property on line 20 of Form1065. S corporations.S corporations claim the deduction for the business use ofclean-fuel vehicle and clean-fuel vehicle refueling property on line19 of Form 1120S. Other corporations.Corporations claim the deduction for the business use of clean-fuelvehicle and clean-fuel vehicle refueling property on line 26 of Form1120 (line 22 of Form 1120-A). Recapture ofthe Deductions If the property ceases to qualify, you may have to recapture thededuction. You recapture the deduction by including it, or a part ofit, in your income. Clean-Fuel Vehicle Property You must recapture the deduction for clean-fuel vehicle property ifthe property ceases to qualify within 3 years after the date youplaced it in service. The property will cease to qualify if it: Is modified so that it can no longer be propelled by aclean-burning fuel, Ceases to be a qualified clean-fuel vehicle property (forexample, by failing to meet emissions standards), or Is used-- Predominantly outside the United States, Predominantly to furnish lodging or in connection with thefurnishing of lodging, By certain tax-exempt organizations, or By governmental units or foreign persons or entities. Sales or other dispositions.If you sell or otherwise dispose of the vehicle within 3 yearsafter the date you placed it in service and know or have reason toknow that it will be used in a manner described above, you are subjectto the recapture rules. In other sales or dispositions (including adisposition by reason of an accident or other casualty), the recapturerules do not apply. If the vehicle was subject to depreciation, the deduction (minusany recapture) is considered depreciation when figuring the part ofthe gain that is ordinary income. See Publication 544for moreinformation on dispositions of depreciable property. Recapture amount.Figure your recapture amount by multiplying the deduction by arecapture percentage. The percentages are as follows. 100% if the recapture date is within the first fullyear after the date the vehicle was placed in service. 66 2/3% if the recapture date is withinthe second full year after the date the vehicle was placed inservice. 33 1/3% if the recapture date is within thethird full year after the date the vehicle was placed inservice. Recapture date.The recapture date is generally the date of the event that causesthe recapture. However, the recapture date for an event described initem (3), earlier, is the first day of the recapture year in which theevent occurs. How to report.How you report the recapture amount for clean-fuel vehicle propertyas income depends on how you claimed the deduction for that property. Nonbusiness use by individuals.Include the amount on line 21 of Form 1040. Business use by employees.Include the amount on line 21 of Form 1040. Business use by sole proprietors.Include the amount on the Other income hotel rooms Rothenburgline of eitherSchedule C (Form 1040) or Schedule F (Form 1040). Partnerships and corporations (including S corporations).Include the amount on the Other income line of the formyou file. Clean-Fuel VehicleRefueling Property You must recapture the deduction for clean-fuel vehicle refuelingproperty if the property ceases to qualify at any time before the endof its depreciation recovery period. The property will cease toqualify if it: Ceases to be a clean-fuel vehicle refueling property (forexample, by being converted to store and dispense gasoline), Is no longer used 50% or more in your trade or business,or Is used-- Predominantly outside the United States, Predominantly to furnish lodging or in connection with thefurnishing of lodging, By certain tax-exempt organizations, or By governmental units or foreign persons or entities. Sales or other dispositions.If you sell or otherwise dispose of the property before the end ofits recovery period and know or have reason to know that it will beused in a manner described above, you are subject to the recapturerules. In other sales or dispositions, the recapture rules do notapply. The deduction (minus any recapture amount) is considereddepreciation when figuring the part of the gain that is ordinaryincome upon its disposition. See Publication 544for more informationon dispositions of depreciable property. Recapture amount.Figure your recapture amount by multiplying the deduction youclaimed by the following fraction. Total recovery period for _ Recovery years before the property the recapture year    Total recovery period for theproperty Recapture date.The recapture date is generally the date of the event that causesthe recapture. However, the recapture date for an event described initem (2) or (3), earlier, is the first day of the recapture year inwhich the event occurs. How to report.How you report the recapture amount for clean-fuel vehiclerefueling property depends on how you claimed the deduction for thatproperty. Business use by sole proprietors.Include the amount on the Other income line of eitherSchedule C (Form 1040) or Schedule F (Form 1040). Partnerships and corporations (including S corporations).Include the amount on the Other income line of the formyou file. Basis Adjustments You must reduce the basis of your clean-fuel vehicle or clean-fuelvehicle refueling property by the amount of the deduction claimed. If,in a later year, you must recapture part or all of the deduction,increase the basis of the property by the amount recaptured. If theproperty is depreciable property, you can recover this additionalbasis over the property's remaining recovery period beginning with thetax year of recapture. Caution: If you were using the percentage tables to figure your depreciationon the property, you will not be able to continue to do so. SeePublication 946for information on figuring your depreciation withoutthe tables.