TITLE 3 TAXATION
CHAPTER 13 BUSINESS TAX CREDITS
PART 21 BIODIESEL
BLENDING FACILITY TAX CREDIT
3.13.21.1 ISSUING
AGENCY: Energy, Minerals and Natural Resources
Department.
[3.13.21.1 NMAC - N,
10-31-07]
3.13.21.2 SCOPE:
3.13.21 NMAC applies to the application and certification procedures for
administration of the biodiesel blending facility tax credit for rack
operations.
[3.13.21.2 NMAC - N,
10-31-07]
3.13.21.3 STATUTORY
AUTHORITY: 3.13.21 NMAC is established under the authority
of NMSA 1978, Section 7-9-79.2 and NMSA 1978, Section 9-1-5.
[3.13.21.3 NMAC - N,
10-31-07]
3.13.21.4 DURATION:
Permanent.
[3.13.21.4 NMAC - N,
10-31-07]
3.13.21.5 EFFECTIVE
DATE: October 31, 2007, unless a later date is
cited at the end of a section.
[3.2.21.5 NMAC - N,
10-31-07]
3.13.21.6 OBJECTIVE:
3.13.21 NMAC’s objective is to establish procedures for administering
the program to issue a certificate of eligibility for the biodiesel blending
facility tax credit for rack operators.
[3.13.21.6 NMAC - N,
10-31-07]
3.13.21.7 DEFINITIONS:
A. “Annual cap”
means the annual aggregate amount of the biodiesel blending facility tax credit
available to taxpayers.
B. “Applicant”
means a taxpayer that installs biodiesel blending equipment for the purpose of
establishing or expanding a biodiesel blending facility and that desires to
have the department issue a certificate of eligibility for a biodiesel blending
facility tax credit.
C. “Application
package” means the application documents an applicant submits to the department
to receive a certificate of eligibility for a biodiesel blending facility tax
credit.
D. “Biodiesel”
means renewable, biodegradable, monoalkyl ester combustible liquid fuel that is
derived from agricultural plant oils or animal fats and that meets the ASTM
International D 6751 standard specification for biodiesel B100 blend stock for
distillate fuels (Copyright ASTM International , 100 Barr Harbor Drive, West
Conshohocken, PA 19428. This document is available for public viewing
only at the New Mexico state records center and archives and may not be
reproduced, in full or part. A copy of
this publication may be obtained from ASTM International, www.astm.org.)
E. “Biodiesel
blending equipment” means equipment necessary for the process of blending
biodiesel with diesel fuel to produce blended biodiesel fuel.
F. “Biodiesel
blending facility” means an installation that is part of a rack operation for
the purpose of blending biodiesel fuel, including reactivating existing
blending and storage equipment in place, expanding storage equipment at an
existing facility, installing a new blending facility or site specific blending
at a retail facility.
G. “Biodiesel
blending facility tax credit” means the gross receipts or compensating tax
credit the state of New Mexico issues to an applicant for a biodiesel blending
facility.
H. “Blended
biodiesel fuel” means a diesel fuel that contains at least two percent
biodiesel.
I. “Bulk storage" means the storage of special fuels in any tank or
receptacle, other than a supply tank, for the purpose of sale by a dealer or for use by a user or for any
other purpose.
J. "Bulk
storage user" means a user who operates, owns or maintains bulk storage in
this state from which the user places special fuel into the supply tanks of
motor vehicles that the user
owns or operates.
K. “Certificate of
eligibility” means the document, with a unique identifying number that
specifies the amount and taxable year for the approved biodiesel blending
facility tax credit.
L. "Dealer" means any person who sells and delivers special
fuel to a user.
M. “Department”
means the energy, minerals and natural resources department.
N. “Diesel fuel”
means any diesel-engine fuel used for the generation of power to propel a motor
vehicle.
O. “Installation of
equipment” means to assemble and construct biodiesel blending equipment,
including equipment necessary for receiving and off-loading B100 or pre-blended
biodiesel, equipment for storage of B100 or blended biodiesel fuel and
equipment for on-loading and dispensing B100 or blended biodiesel fuel.
P. "Motor vehicle" means a self-propelled vehicle or device that
is either subject to registration pursuant to NMSA 1978 Section 66-3-1 or is
used or may be used on the public highways in whole or in part for the purpose
of transporting persons or property and includes any connected trailer or
semitrailer.
Q. Rack operations” means a facility that is a refinery in this state, any
facility where special fuel is blended in this state or where special fuel is
stored at a pipeline terminal in this state.
R. "Rack operator" means the operator of a
refinery in this state, any person who blends special fuel in this state or the
owner of special fuel stored at a pipeline terminal in this state.
S. “Supply tank” means any tank or other receptacle in which or by which fuel may be carried and supplied to
the fuel-furnishing device or apparatus of the propulsion mechanism of a motor
vehicle when the tank or receptacle either contains special fuel or special
fuel is delivered into it.
T. “Taxable
year” means the annual accounting period for purposes of filing corporate
income taxes, as defined by the Unites States internal revenue service.
U. “Taxpayer” means
a rack operator who owns the rack operation where the rack operator installs
biodiesel blending equipment and who applies for certification of an operating
biodiesel blending facility in order to receive a biodiesel blending facility
tax credit and is liable for payment of gross receipts or compensating taxes.
V. “Taxpayer
identification number” means an 11-digit number the New Mexico taxation and
revenue department issues that indicates that the taxpayer is registered with
the taxation and revenue department to pay gross receipts and compensating
taxes.
[3.13.21.7 NMAC - N,
10-31-07]
3.13.21.8 GENERAL
PROVISIONS:
A. Only a taxpayer
who on or after July 1, 2007 installs biodiesel blending equipment in New
Mexico for the purpose of establishing or expanding a biodiesel blending
facility may receive a certificate of eligibility for a biodiesel blending
facility tax credit.
B. The biodiesel
blending facility tax credit is an amount equal to 30 percent of the biodiesel
blending equipment’s purchase cost plus 30 percent of the biodiesel blending
equipment’s installation cost.
C. The biodiesel
blending facility tax credit shall not exceed $50,000 for biodiesel blending
equipment installed at any one facility.
D. The annual
aggregate amount of the biodiesel blending facility tax credit available to
taxpayers is limited to $1,000,000. When
the $1,000,000 limit for rack operations is reached based on the total
certificates of eligibility the department has issued and New Mexico department
of taxation and revenue has recorded, the department shall:
(1) if part of the
eligible biodiesel blending facility tax credit is within the annual cap and
part is over the annual cap, issue a certificate of eligibility for the amount
under the annual cap for the applicable taxable year and issue a certificate of
eligibility for the balance for the subsequent taxable year; or
(2) if no biodiesel
blending facility tax credit funds are available, issue a certificate of eligibility
for the next subsequent taxable year in which funds are available.
E. In the event of
a discrepancy between a requirement of 3.13.21 NMAC and an existing New Mexico
taxation and revenue department rule promulgated before 3.13.21 NMAC’s adoption,
the existing rule governs.
[3.13.21.8 NMAC - N,
10-31-07]
3.13.21.9 CERTIFICATE
OF ELIGIBILITY APPLICATION:
A. An applicant may
obtain a certificate of eligibility application form from the department.
B. An application package
shall include a completed certificate of eligibility application form and
attachments as specified on the certificate of eligibility application
form. The applicant shall submit the
completed certificate of eligibility application form and required attachments
at the same time. An applicant shall
submit one certificate of eligibility application for each biodiesel blending
facility. The applicant shall submit all
material submitted in the application package on 8½ inch by 11 inch paper.
C. An
applicant shall submit a complete application package to the department no
later than 90 days before the end of taxable year for which the applicant seeks
the biodiesel blending facility tax credit to allow time for approval and
issuance of an approved certificate of eligibility. The department reviews application packages
it receives after that date for the subsequent taxable year.
D. The completed
certificate of eligibility application shall consist of the following
information:
(1) taxpayer information, including the
applicant’s name, mailing address, telephone number, biodiesel blending
facility tax credit’s taxable year or years and CRS or taxpayer identification
number;
(2) blending equipment
information, including project location with county and legal description,
blending equipment type (splash or injection), blending equipment description,
blending equipment cost, blending equipment installation cost and date on which
the biodiesel blending equipment and facility went into operation;
(3) proof of ownership of
the rack, design schematic, equipment specifications and serial numbers,
photographs, installation/construction documents, storage and blending
capacities, description of operation, construction permit and environmental
protection agency related plans with engineer’s stamp and final inspection
report;
(4) evidence of purchase
of equipment and installation including receipts and invoices; and
(5) applicant agreement stating that the
taxpayer agrees that all information in the application packet is true and
correct to the best of the applicant’s knowledge, that the applicant has read
the certification requirements of 3.13.21 NMAC, that the applicant understands
that there is an annual aggregate biodiesel blending facility tax credit limit,
that the department must certify the biodiesel blending facility documented in
the application package is eligible for the biodiesel blending facility tax
credit and that the applicant allows the department or its authorized
representative to inspect the biodiesel blending facility that is described in
the application package from the application package’s submittal to three years
after the department has certified the biodiesel blending facility upon the
department providing a minimum of five days notice to the applicant.
[3.13.21.9 NMAC - N,
10-31-07]
3.13.21.10 APPLICATION
REVIEW PROCESS:
A. The department
considers certificate of eligibility applications in the order received,
according to the day they are received, but not the time of day.
B. The department
reviews the application package to calculate the biodiesel blending facility
tax credit, check accuracy of the applicant’s documentation and determine
whether the department issues a certificate of eligibility for the biodiesel
blending facility tax credit.
C. If the
department verifies that no person has applied for a biodiesel blending
facility tax credit for that biodiesel blending facility and if the department
finds that the application package meets the requirements and funds for a
biodiesel blending facility tax credit are available, the department issues the
certificate of eligibility for a biodiesel blending facility tax credit. If funds for a biodiesel blending facility
tax credit are partially available or not available, the department issues a
certificate of eligibility for any amount that is available and a certificate
of eligibility for the balance for the next taxable year in which funds are
available. The certificate of
eligibility shall include the taxpayer’s contact information, taxpayer
identification number, certificate of eligibility project number, the biodiesel
blending facility tax credit amount or amounts and the biodiesel blending
facility tax credit’s taxable year or years.
D. The department
disapproves an application that is not complete or correct. The department’s disapproval letter shall
state the reasons why the department disapproved the application. The applicant may resubmit the application
package for the disapproved project. The
department places the resubmitted application in the review schedule as if it
were a new application.
[3.13.21.10 NMAC -
N, 10-31-07]
3.13.21.11 CLAIMING
THE BIODIESEL BLENDING FACILITY TAX CREDIT:
A. Upon
receipt of a certificate of eligibility from the department, the taxpayer shall
submit a completed form RPD-41339, biodiesel
blending facility tax credit approval request form, to the
taxation and revenue department. The taxpayer
shall attach the certificate of eligibility received from the department and a
copy of the invoice for the qualified equipment and installation costs. Once the taxation and revenue department
notifies the taxpayer of approval for the biodiesel blending facility tax
credit, the taxpayer may apply the biodiesel blending facility tax credit to
gross receipts and compensating tax due.
To apply the biodiesel blending facility tax credit, the taxpayer shall
submit form RPD-41321, biodiesel
blending facility tax credit claim form, along with a CRS-1 long form
for the report period to which the taxpayer wishes to apply the biodiesel
blending facility tax credit. Unused
biodiesel blending facility tax credit may be carried forward for four years
from the date the department issues the certificate of eligibility.
B. If
a rack operator who has claimed biodiesel blending facility tax credit against
gross receipts tax or compensating tax due ceases biodiesel blending without
completing at least 180 days of availability of the facility within the first
365 days after the department’s issuance of a certificate of eligibility, the
taxpayer shall notify taxation and revenue department that the taxpayer is no
longer eligible for the approved biodiesel blending facility tax credit and
that the liabilities for the reports to which the biodiesel blending facility
tax credit had been applied are now due.
The taxation and revenue department will extinguish any amount of the
approved biodiesel blending facility tax credit not applied against the
taxpayer’s gross receipts tax or compensating tax liability and assess the
taxpayer for the tax owed. The taxpayer
shall pay the assessment within 425 days of the date of issuance of the certificate
of eligibility. The taxpayer may still
qualify for subsequent biodiesel blending facility tax credits, within the
first 365 days after the department’s issuance of the certificate of
eligibility. When applying for biodiesel
blending facility tax credits the taxpayer shall use only the CRS-1 long form.
C. Beginning with
the taxable year on each certificate of eligibility, the taxation and revenue
department applies 30 percent of the amount on the certificate of eligibility
against the applicant’s gross receipts or compensating tax liability for four
years, unless the amount is less than or equal to $50,000, in which case the
taxation and revenue department applies the entire biodiesel blending facility
tax credit in the taxable year on the certificate.
D. If the amount of
the biodiesel blending facility tax credit the applicant claims exceeds the
applicant’s gross receipts or compensating tax liability, the applicant may
carry the excess forward for up to four consecutive taxable years.
[3.13.21.11 NMAC -
N, 10-31-07]
HISTORY OF 3.13.21 NMAC:
[RESERVED]