Over the past few months and throughout the pandemic, landscaping and lawn maintenance companies have seen it all. Between the “essential” vs. “non-essential” debate and the PPP loan process, landscaping and lawn maintenance companies have been busy. But there IS one thing that hasn’t been affected by these strange times. Landscaping business owners still want to reduce their business expense- and FuelCred is here to help.
The Fuel Tax
If you read our blog, you know there is a federal tax on all fuel sold at retail gas stations. That tax rate is 18.3 cents per gallon of gasoline and 24.3 cents per gallon of diesel fuel. For Green industry businesses that adds up quickly. For example, a number of FuelCred users consume over 12,000 gallons of fuel each year. The tax paid on that fuel is over $2,400 per year!
The good news is that federal fuel tax is intended only for those who use fuel for “on-highway” purposes. The fuel used in your landscaping and lawn maintenance business for “off-road” purposes should be tax-free. It’s called the Fuel Tax Credit (or more formally the “Credit for Federal Tax Paid on Fuels”), and it’s becoming a vital tax savings for Green industry companies that use fuel for off-road purposes (i.e. in lawnmowers, tractors, snow blowers, etc).
The Fuel Tax Credit enables landscaping businesses to be reimbursed for the taxes they pay at the pump. All landscaping and lawn maintenance businesses should be tracking their off-road fuel every year. This tax credit is a 1-for-1 reduction in taxes for these businesses. In other words, even if a business doesn’t owe any taxes, the IRS will send an eligible business a check for the fuel tax refund owed. It’s important to note that Fuel Tax Credits are on top off and in addition to fuel expense deductions.
The Fuel Tax Credit is widely unused
Keeping track of all receipts from every gas station throughout the year is a big undertaking which makes filing IRS Form 4136 (the IRS fuel tax credit form) a time-consuming and tedious endeavor. Perhaps that’s why over $1.6 Billion dollars of refundable fuel tax credits go unclaimed by small businesses every single year. To make matters worse, FuelCred spoke with several small business CPAs and accountants and most were not even aware this credit existed!
Now, more than ever, that extra money can have a huge impact. This is why FuelCred is dedicated to streamlining this process and helping small businesses claim their money.
It’s as easy as connecting your business credit card and answering a few questions about your business and you’re done! FuelCred creates an auditable log of every fuel purchase and automatically populates IRS Form 4136 and can even send it to your CPA; the shoebox full of receipts is a thing of the past. Whether you’re working with an accountant, CPA, or doing your own taxes, FuelCred saves time and frustration and saves you money.
More ways to save money on fuel
Of course, finding the cheapest fuel in the first place is also important. FuelCred also helps you search for nearby gas stations to find the best prices. FuelCred users have access to “FuelCred prices”, a price-per-gallon calculation of the fuel option that would save you the most money based on your individual historical fuel use and current job location. The “FuelCred Price” is often up to 40% cheaper than retail and is FuelCred’s real-time recommendation of the best fuel option based on a specific job site or location.
Putting it all together
Tracking fuel purchases and purchasing lower cost fuel can help you reduce expenses, but could also helps in understanding how seasonality impacts your expenses, plan ahead for the future, and prepare for upcoming projects.
Stop leaving money on the table and optimize your business with new technology such as FuelCred.
