Clean Fuel Vehicle (code 05)

To encourage individuals and businesses to reduce vehicle-related air pollution, Utah offers a nonrefundable tax credit for qualified new vehicles or for the conversion of vehicles or engines that use clean burning fuels. There are four credits available, listed below. The credit may only be taken once per vehicle and must be claimed in the taxable year the vehicle or engine is purchased or converted. If the credit was taken by a previous owner, the current owner is not eligible to take the credit.

This credit may only be applied against current Utah income tax due; any tax credit in excess of tax due will not be refunded. However, the credit in excess of the current tax liability may be carried over to the next five years and used against subsequent tax liabilities until used up.

$750 if you bought a new vehicle with less than 7,500 miles, and registered and titled for the first time in Utah. The vehicle must meet the following fuel economy standards:
- At least 31 miles per gallon for gasoline-fueled vehicles;
- At least 36 miles per gallon for diesel-fueled vehicles;
- At least 19 miles per gallon for vehicles fueled by a blend of 85% ethanol and 15% gasoline;
- At least 19 miles per gallon for liquefied petroleum gas-fueled vehicles; or
- Meet standards consistent with 40 C.F.R. 600.209-95(d) that are adopted by the Air Quality Board by rule.
The lesser of $2,500 or 35% of the purchase price for a qualified vehicle fueled by compressed natural gas and registered in Utah.
The lesser of $2,500 or 50% of the cost of conversion equipment (less any clean fuel grant received) for a vehicle registered in Utah. The equipment must convert the engine to:
- Be fueled by propane, compressed natural gas, or electricity;
- Be fueled by another fuel as effective as the above listed fuels, as determined by the Air Quality Board; or
- Meet the clean fuel vehicle standards in the federal Clean Air Act.
The lesser of $1,000 or 50% of the cost of conversion equipment not designed or used primarily for the transportation of persons or property, including maintenance equipment, less any clean fuel grant received, if the equipment converts the engine to be:

Fueled by propane, compressed natural gas, or electricity;
Fueled by another fuel determined by the Air Quality Board to be as effective as the above listed fuels;
or Substantially more effective in reducing air pollution than the fuel for which the engine was originally designed.

Claiming the Credit

To claim this credit, complete form TC-40V, Clean Fuel Vehicle Tax Credit, which must be certified by the Department of Environmental Quality's Division of Air Quality, verifying the credit is approved. Do not submit this form with your tax return; keep it with your tax records.

For more information, contact

Division of Air Quality
150 North 1950 West
Salt Lake City, UT 84116
Telephone 801-536-4000
http://airquality.utah.gov/Planning/Mobile/Clean_Fuel_Tax_Credit.htm