Publication 510
taxmap/pubs/p510-021.htm#en_us_publink1000116983This section provides definitions of the terms used in Table
2-1 for nontaxable uses. If applicable, the type of use number from Table 2-1 is
indicated in each heading.
taxmap/pubs/p510-021.htm#en_us_publink1000116984The first column of the table is the number you enter on Form
4136, Form 8849, or Schedule C (Form 720) for that type of use. For type of use
2, the mobile machinery parenthetical applies only to Form 8849 and Form 720.
taxmap/pubs/p510-021.htm#f46455f9
Table 2-1. Type of Use Table
| No. | Type of Use |
| 1 | On a farm for farming purposes |
| 2 | Off-highway business use (for business use other than in
a highway vehicle registered or required to be registered for highway use)
(other than use in mobile machinery)
|
| 3 | Export |
| 4 | In a boat engaged in commercial fishing |
| 5 | In certain intercity and local buses |
| 6 | In a qualified local bus |
| 7 | In a bus transporting students and employees of schools
(school buses) |
| 8 | For diesel fuel and kerosene (other than kerosene used in
aviation) used other than as a fuel in the propulsion engine of a train or
diesel-powered highway vehicle (but not off-highway business use)
|
| 9 | In foreign trade |
| 10 | Certain helicopter and fixed-wing aircraft uses |
| 11 | Exclusive use by a qualified blood collector organization |
| 12 | In a highway vehicle owned by the United States that is
not used on a highway |
| 13 | Exclusive use by a nonprofit educational organization |
| 14 | Exclusive use by a state, political subdivision of a state,
or the District of Columbia |
| 15 | In an aircraft or vehicle owned by an aircraft museum |
| 16 | In military aircraft |
On a farm for farming purposes means fuel used in carrying on
a trade or business of farming, on a farm in the United States, and for farming
purposes.
taxmap/pubs/p510-021.htm#en_us_publink1000116986A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing
animals, and truck farms; orchards; plantations; ranches; nurseries; ranges; and
feed yards for fattening cattle. It also includes structures such as greenhouses
used primarily for the raising of agricultural or horticultural commodities. A
fish farm is an area where fish are grown or
raised — not merely caught or harvested.
taxmap/pubs/p510-021.htm#en_us_publink1000116987As an owner, tenant, or operator, you use fuel on a farm for
farming purposes if you use it in any of the following ways.
- To cultivate the soil or to raise or harvest any agricultural
or horticultural commodity.
- To raise, shear, feed, care for, train, or manage livestock,
bees, poultry, fur-bearing animals, or wildlife.
- To operate, manage, conserve, improve, or maintain your farm
and its tools and equipment.
- To handle, dry, pack, grade, or store any raw agricultural
or horticultural commodity. For this use to qualify, you must have produced more
than half the commodity so treated during the tax year. Commodity means a single
raw product. For example, apples and peaches are two separate commodities.
- To plant, cultivate, care for, or cut trees or to prepare
(other than sawing logs into lumber, chipping, or other milling) trees for
market, but only if the planting, etc., is incidental to your farming
operations. Your tree operations will be incidental only if they are minor in
nature when compared to the total farming operations.
If any other person, such as a neighbor or custom operator, performs
a service for you on your farm for any of the purposes listed in (1) or (2), you
are considered to be the ultimate purchaser that used the fuel on a farm for
farming purposes. However, see
Custom application of fertilizer and pesticide,
next.
If doubt exists whether the owner, the tenant, or the operator
of the farm bought the fuel, determine who bore the cost of the fuel. For
example, if the owner of a farm and the tenant equally share the cost of
gasoline that is used on a farm for farming purposes, each can claim a credit
for the tax on one-half the fuel used.
taxmap/pubs/p510-021.htm#en_us_publink1000116988
Fuel used on a farm for farming purposes includes fuel used in the application
of fertilizer, pesticides, or other substances, including aerial applications.
Generally, the applicator is treated as having used the fuel on a farm for
farming purposes. For aviation gasoline, the aerial applicator makes the claim
as the ultimate purchaser. For kerosene used in aviation, the ultimate purchaser
may make the claim or waive their right to make the claim to the registered
ultimate vendor.
taxmap/pubs/p510-021.htm#en_us_publink1000116989Fuel used by an aerial applicator for the direct flight between
the airfield and one or more farms is treated as a farming purpose.
taxmap/pubs/p510-021.htm#en_us_publink1000116990Fuel is not used on a farm for farming purposes if it is used
in any of the following ways.
- Off the farm, such as on the highway or in noncommercial aviation,
other than fuel used between the airfield and farm described above, even if the
fuel is used in transporting livestock, feed, crops, or equipment.
- For personal use, such as mowing the lawn.
- In processing, packaging, freezing, or canning operations.
- In processing crude gum into gum spirits of turpentine or
gum resin or in processing maple sap into maple syrup or maple sugar.
Off-highway business use means fuel used in a trade or business
or in an income-producing activity other than as a fuel in a highway vehicle
registered or required to be registered for use on public highways. The terms
"highway vehicle," "public highway," and "registered" are defined below. 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, this use does not include nonbusiness use of fuel,
such as use by minibikes, snowmobiles, power lawn mowers, chain saws, and other
yard equipment.
taxmap/pubs/p510-021.htm#en_us_publink1000116992Caroline 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.
taxmap/pubs/p510-021.htm#en_us_publink1000116993A 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.
Generally, the following kinds of vehicles are not considered
highway vehicles for purposes of the credit or refund of fuel taxes.
- 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 (and power source, if applicable) 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.
- The vehicle must have traveled less than 7,500 miles on
public highways during the taxable year.
- Vehicles specially designed for off-highway transportation.
A vehicle is not treated as a highway vehicle if the vehicle is specially
designed for the primary function of transporting a particular type of load
other than over the public highway and because of this special design, the
vehicle's capability to transport a load over a public highway is substantially
limited or impaired.To make this determination, you can take into account the
vehicle's size, whether the vehicle is subject to licensing, safety, or other
requirements, and whether the vehicle can transport a load at a sustained speed
of at least 25 miles per hour. It does not matter that the vehicle can carry
heavier loads off highway than it is allowed to carry over the highway.
- Nontransportation trailers and semitrailers.
A trailer or semi-trailer is not treated as a highway vehicle if it is specially
designed to function only as an enclosed stationary shelter for carrying on a
nontransportation function at an off-highway site. For example, a trailer that
is capable only of functioning as an office for an off-highway construction
operation is not a highway vehicle.
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.
taxmap/pubs/p510-021.htm#en_us_publink1000116996A 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.
taxmap/pubs/p510-021.htm#en_us_publink1000116997Off-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.
taxmap/pubs/p510-021.htm#en_us_publink1000116998The 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 off-highway business use.
taxmap/pubs/p510-021.htm#en_us_publink1000116999Off-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.
taxmap/pubs/p510-021.htm#en_us_publink1000117000Hazel owns a refrigerated truck. It has a separate motor for
the refrigeration unit. The same tank supplies both motors. Using the truck's
hubometer, Hazel 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.
taxmap/pubs/p510-021.htm#en_us_publink1000117001You cannot treat fuel lost or destroyed through spillage, fire,
or other casualty as fuel used in an off-highway business use.
taxmap/pubs/p510-021.htm#en_us_publink1000117002Export means fuel transported from the United States with the
intention that the fuel remain in a foreign country or possession of the United
States. Fuel is not exported if it is in the fuel supply tank of a vehicle or
aircraft.
taxmap/pubs/p510-021.htm#en_us_publink1000117003In a boat engaged in commercial fishing means fuel used in taking,
catching, processing, or transporting fish, shellfish, or other aquatic life for
commercial purposes, such as selling or processing the catch, on a specific trip
basis. They include boats used in both fresh and salt water fishing. They do not
include boats used for both sport fishing and commercial fishing on the same
trip.
taxmap/pubs/p510-021.htm#en_us_publink1000117004In certain intercity and local buses means fuel used in a bus
engaged in furnishing (for compensation) passenger land transportation available
to the general public. The bus must be engaged in one of the following
activities.
- Scheduled transportation along regular routes.
- Nonscheduled operations if the seating capacity of the bus
is at least 20 adults, not including the driver. Vans and similar vehicles used
for van-pooling or taxi service do not qualify.
This means you offer service to more than a limited number of
persons or organizations. If a bus operator normally provides charter operations
through travel agencies but has buses available for chartering by the general
public, this service is available to the general public. A bus does not qualify
when its operator uses it to provide exclusive services to only one person,
group, or organization. Also, intercity bus transportation does not include
transporting students and employees of schools or intercity transportation in a
qualified local bus.
taxmap/pubs/p510-021.htm#en_us_publink1000117006In a qualified local bus means fuel used in a bus meeting all
the following requirements.
- It is engaged in furnishing (for compensation) intracity passenger
land transportation available to the general public.
- It operates along scheduled, regular routes.
- It has a seating capacity of at least 20 adults (excluding
the driver).
- It is under contract with (or is receiving more than a nominal
subsidy from) any state or local government to furnish the transportation.
This is the land transportation of passengers between points
located within the same metropolitan area. It includes transportation along
routes that cross state, city, or county boundaries if the routes remain within
the metropolitan area.
taxmap/pubs/p510-021.htm#en_us_publink1000117008A bus is under contract with a state or local government only
if the contract imposes a bona fide obligation on the bus operator to furnish
the transportation.
taxmap/pubs/p510-021.htm#en_us_publink1000117009A subsidy is more than nominal if it is reasonably expected to
exceed an amount equal to 3 cents multiplied by the number of gallons of fuel
used in buses on subsidized routes. A company that operates its buses along
subsidized and unsubsidized intracity routes may consider its buses qualified
local buses only when the buses are used on the subsidized intracity routes.
taxmap/pubs/p510-021.htm#en_us_publink1000117010In a school bus means fuel used in a bus engaged in the transportation
of students or employees of schools. A school is an educational organization
with a regular faculty and curriculum and a regularly enrolled body of students
who attend the place where the educational activities occur.
taxmap/pubs/p510-021.htm#en_us_publink1000117011Diesel fuel and kerosene (other than kerosene used in aviation)
used other than as a fuel in the propulsion engine of a diesel-powered highway
vehicle or diesel-powered train (not including off-highway business use) means
undyed diesel fuel and undyed kerosene used:
- For home heating, lighting, and cooking;
- In boats;
- In stationary machines, such as generators and compressors;
- For cleaning purposes; or
- In minibikes and snowmobiles.
In foreign trade means fuel used in civil aircraft employed in
foreign trade or trade between the United States and any of its possessions. The
term trade includes the transportation of persons or property for hire and the
making of the necessary preparations for such transportation. In the case of
aircraft registered in a foreign country, the country must allow reciprocal
benefits for aircraft registered in the United States.
taxmap/pubs/p510-021.htm#en_us_publink1000117013taxmap/pubs/p510-021.htm#en_us_publink1000117014Certain helicopter uses means fuel used by a helicopter for any
of the following purposes.
- Transporting individuals, equipment, or supplies in the exploration
for, or the development or removal of, hard minerals, oil, or gas.
- Planting, cultivating, cutting, transporting, or caring for
trees (including logging operations).
- Providing emergency medical transportation.
During a use described in items (1) and (2), the helicopter must
not take off from, or land at, a facility eligible for assistance under the
Airport and Airway Development Act of 1970, or otherwise use services provided
pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title
49, United States Code. For item (1), treat each flight segment as a separate
flight.
taxmap/pubs/p510-021.htm#en_us_publink1000117015Fixed-wing aircraft uses means fuel used by a fixed-wing aircraft
for any of the following purposes.
- Planting, cultivating, cutting, transporting, or caring for
trees (including logging operations).
- Providing emergency medical transportation. The aircraft must
be equipped for and exclusively dedicated on that flight to acute care emergency
medical services.
During a use described in item (1), the aircraft must not take
off from, or land at, a facility eligible for assistance under the Airport and
Airway Development Act of 1970, or otherwise use services provided pursuant to
section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United
States Code.
taxmap/pubs/p510-021.htm#en_us_publink1000117016Exclusive use by a qualified blood collector organization means
fuel used by the qualified blood collector organization for its exclusive use in
the collection, storage, or transportation of blood.
taxmap/pubs/p510-021.htm#en_us_publink1000117017A qualified blood collector organization is one that is:
- Described in section 501(c)(3) and exempt from tax under section
501(a),
- Primarily engaged in the activity of collecting human blood,
- Registered by the IRS, and
- Registered by the Food and Drug Administration to collect
blood.
In a highway vehicle owned by the United States that is not used
on a highway means fuel used in a vehicle that was not used on public highways
during the period covered by the claim. This use applies whether or not the
vehicle is registered or required to be registered for highway use.
taxmap/pubs/p510-021.htm#en_us_publink1000117019Exclusive use by a nonprofit educational organization means fuel
used by an organization exempt from income tax under Internal Revenue Code
section 501(a) that meets both of the following requirements.
- It has a regular faculty and curriculum.
-
It has a regularly enrolled body of students who attend the place where the
instruction normally occurs.
A nonprofit educational organization also includes a school operated
by a church or other organization described in Internal Revenue Code section
501(c)(3) if the school meets the above requirements.
taxmap/pubs/p510-021.htm#en_us_publink1000117020Exclusive use by a state, political subdivision of a state, or
the District of Columbia means fuel purchased by the state or local government
for its exclusive use. A state or local government is any state, any political
subdivision thereof, or the District of Columbia. An Indian tribal government is
treated as a state only if the fuel is used in an activity that involves the
exercise of an essential tribal government function. Gasoline, diesel fuel, and
kerosene used by the American Red Cross is considered to be the use of these
fuels by a state.
taxmap/pubs/p510-021.htm#en_us_publink1000117021In an aircraft or vehicle owned by an aircraft museum means fuel
used in an aircraft or vehicle that is owned by an organization that meets all
the following requirements.
- It is exempt from income tax as an organization described
in Internal Revenue Code section 501(c)(3).
- It is operated as a museum under a state (or District of Columbia)
charter.
- It is operated exclusively for acquiring, exhibiting, and
caring for aircraft of the type used for combat or transport in
World War II.
The aircraft or vehicle (such as a ground servicing vehicle for
aircraft) must be used exclusively for the purposes described in item (3).
taxmap/pubs/p510-021.htm#en_us_publink1000117022In a military aircraft means fuel used in an aircraft owned by
the United States or any foreign nation and constituting a part of its armed
forces.
taxmap/pubs/p510-021.htm#en_us_publink1000117023See
Commercial aviation on page 11 for the definition.
taxmap/pubs/p510-021.htm#en_us_publink1000117024Use in a train means fuel used in the propulsion engine of equipment
or machinery that rides on rails. This includes use in a locomotive, work train,
switching engine, and track maintenance machine.
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