On January 1, 2013 Congress completed action on legislation to avoid the consequences of sending the country over the so-called fiscal cliff. The legislation, which is expected to be signed by the president, contains several provisions that will affect the propane services industry. First, there were some propane specific energy tax credits that had expired and have been extended through 2013. In addition, these provisions were also made retroactive for taxable year 2012:
- Alternative Fuel Tax Credit: 50 cents per gallon including propane used in forklifts
- Alternative Fuel Infrastructure Tax Credit: 30% up to a maximum of $30,000
- Energy Efficient Existing Homes Tax Credit: $150 for qualified propane furnace and $300 for qualified propane water heater
- Energy Efficient New Homes Tax Credit: Up to $2,000 to an eligible contractor who constructs a qualified energy-efficient new home
All the same rules apply to these credits as in the past. The only thing that has changed are the expiration dates.
The other provision of interest to the propane services industry concerns the estate tax. The change to the estate tax provisions have now been made permanent. These changes include an exemption level of $5 million with a top tax rate of 40%. While a complete repeal of estate taxes was preferable, it was never a realistic expectation. The fact that these new thresholds have been made permanent is a step in the right direction.
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– The ThompsonGas Team
*Repurposed from NPGA