Taxpayers may claim a non-refundable tax credit against state individual income tax, corporate franchise tax, or fiduciary tax as follows:
- Original Equipment Manufacturer (OEM) Compressed Natural Gas Vehicles
- Converted Vehicles
- Special Mobile Equipment Converted to Clean Fuels
- Qualifying Electric and Hybrid Vehicles
The state provides an income tax credit of 35% of the vehicle purchase price, up to $2,500, for an original equipment manufacturer compressed natural gas vehicle registered in Utah. This credit is for the taxable year in which the vehicle was purchased.
The state also provides an income tax credit of 50% of the cost of equipment for conversion , up to $2,500, for vehicle that have been converted to run on natural gas, propane or electricity. A new provision was added that allows a conversion of a motor vehicle that satisfies Utah Code Section 19-1-406 to be eligible for the Clean Fuel Tax Credit. The state also provides a credit of up to $1,000 for special equipment converted to operate using a clean fuel, including propane, natural gas, or electricity. These tax credits are for the taxable year in which the conversion equipment is installed.
The state provides an income tax credit of $605 for the original purchase of new qualifying electric or hybrid vehicles. This credit is for the taxable year in which the vehicle was purchased.
How to Claim the Clean Fuel Vehicle Tax Credit
Those claiming the credit must complete a TC40V,which requires the taxpayer to certify under penalty of perjury that the vehicle or special equipment for which the tax credit is being claimed meets all of the requirements of Utah Code Section 59-7-605 or Section 59-10-1009. The TC40v also requires the taxpayer to provide various forms of documentation. You can find the current TC40V here (54 KB).
If you have questions about the Clean Fuel Vehicle Tax Credit, please contact Mat Carlile at (385) 306-6532.