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Department of the Treasury
Internal Revenue Service
Instructions for Form 6478

(Rev. January 2020)
Biofuel Producer Credit

Section references are to the Internal Revenue Code Qualified Second Generation Biofuel
unless otherwise noted.
Production
Future Developments This is second generation biofuel which during the tax
For the latest information about developments related to year:
Form 6478 and its instructions, such as legislation 1. Is sold by the producer to another person:
enacted after they were published, go to IRS.gov/
Form6478. a. For use by the buyer in the buyer’s trade or
business to produce a qualified second generation biofuel
What’s New mixture (other than casual off-farm production),
b. For use by the buyer as a fuel in a trade or
Credit extension and change in updating. The biofuel
business, or
producer credit is retroactively extended for fuel sold or
used in calendar years 2018, 2019, and 2020. Don't claim c. Who sells the second generation biofuel at retail to
the credit for fuel sold or used after 2020 unless the credit another person and puts the second generation biofuel in
is extended again. the retail buyer’s fuel tank; or
Form 6478 and its instructions will no longer be 2. Is used or sold by the producer for any purpose
updated annually. Instead, they'll only be updated when described in (1) above.
necessary. Use these instructions and the Form 6478 Qualified second generation biofuel production doesn’t
(Rev. January 2020) for tax years beginning after 2017. include purchasing alcohol and increasing the proof of the
For previous tax years, see the applicable Form 6478 alcohol through additional distillation. Nor does it include
and instructions. second generation biofuel that isn’t both produced in the
Example 1. Use the 2017 Form 6478 with the 2017 United States or a U.S. possession and used as a fuel in
Instructions for Form 6478 for tax year ending December the United States or a U.S. possession.
31, 2017.
A qualified second generation biofuel mixture combines
For 2018 claims, use Form 6478 (Rev. January second generation biofuel with gasoline or a special fuel.
TIP 2020) because it has lines 1 and 2 available if The producer of the mixture either:
needed. • Used it as a fuel, or
• Sold it as fuel to another person.

General Instructions Second Generation Biofuel
Generally, second generation biofuel, for credit purposes,
Purpose of Form is any liquid fuel, which:
Use Form 6478 (Rev. January 2020) to figure your section • Is derived by, or from, qualified feedstocks;
40 biofuel producer credit for tax years beginning after • Meets the registration requirements for fuels and fuel
2017. You claim the credit for the tax year in which the additives established by the Environmental Protection
sale or use occurs. The credit consists of the second Agency under section 211 of the Clean Air Act (42 U.S.C.
generation biofuel producer credit. 7545); and
You may claim or elect not to claim the biofuel producer • Isn’t alcohol of less than 150 proof. In figuring the proof
of any alcohol, disregard any added denaturants
credit at any time within 3 years from the due date of your
(additives that make the alcohol unfit for human
return (determined without regard to extensions) on either
consumption).
an original or an amended return for the tax year of the
sale or use. A qualified feedstock is:
Partnerships, S corporations, cooperatives, estates, • Any lignocellulosic or hemicellulosic matter that’s
and trusts must file this form to claim the credit. All other available on a renewable or recurring basis; and
taxpayers aren’t required to complete or file this form if • Any cultivated algae, cyanobacteria, or lemna.

their only source for this credit is a partnership, S However, second generation biofuel doesn’t include
corporation, cooperative, estate, or trust. Instead, they any fuel if:
can report this credit directly on the appropriate line of • More than 4% of the fuel (determined by weight) is any
Form 3800, General Business Credit. combination of water and sediment,
Example 2. For 2018, report this credit on the 2018 • The ash content of the fuel is more than 1%
Form 3800, Part III, line 4c; for 2019, report this credit on (determined by weight), or
the 2019 Form 3800, Part III, line 4c. • The fuel has an acid number greater than 25.

Jan 17, 2020 Cat. No. 13606U

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Special rules for algae. For sales described in (1) under 2019, report this amount on the 2019 Form 6251, line 3, or
Qualified Second Generation Biofuel Production, earlier, Schedule I (Form 1041), line 21.
second generation biofuel also includes certain liquid fuel, Registration number. To claim a second generation
which: biofuel producer credit on line 1, you must be registered
• Is derived by, or from, any cultivated algae, with the IRS. Enter your SB registration number in the
cyanobacteria, or lemna; and space provided. For more information, see Form 637 and
• Isn’t alcohol of less than 150 proof (disregard any Pub. 510, Excise Taxes.
added denaturants).
But only if this fuel is sold by the producer to another Line 3
person for refining by such other person into a liquid fuel Enter the total biofuel producer credits from the
which will meet the registration requirements for fuels and appropriate box of:
fuel additives established by the Environmental Protection • Schedule K-1 (Form 1065), Partner’s Share of Income,
Agency under section 211 of the Clean Air Act (42 U.S.C. Deductions, Credits, etc.
7545), and not include any fuel if: Example 4. For 2018, from the 2018 Schedule K-1
• More than 4% of the fuel (determined by weight) is any (Form 1065), box 15 (code I); for 2019, from the 2019
combination of water and sediment, Schedule K-1 (Form 1065), box 15 (code I).
• The ash content of the fuel is more than 1%
• Schedule K-1 (Form 1120-S), Shareholder’s Share of
(determined by weight), or
Income, Deductions, Credits, etc.
• The fuel has an acid number greater than 25.
Example 5. For 2018, from the 2018 Schedule K-1
Also, once this fuel is sold by the producer to another
(Form 1120-S), box 13 (code I); for 2019, from the 2019
person for refining by such person into a fuel which will
Schedule K-1 (Form 1120-S), box 13 (code I).
meet these requirements, neither the producer nor any
other person can use such fuel (or any fuel derived from • Schedule K-1 (Form 1041), Beneficiary’s Share of
such fuel) to figure a second credit for qualified second Income, Deductions, Credits, etc.
generation biofuel production. Example 6. For 2018, from the 2018 Schedule K-1
(Form 1041), box 13 (code H); for 2019, from the 2019
Registration Schedule K-1 (Form 1041), box 13 (code H).
All producers of second generation biofuel must be
• Form 1099-PATR, Taxable Distributions Received
registered with the IRS. See Form 637, Application for
From Cooperatives, or other notice of credit allocation.
Registration.
Example 7. For 2018, from the 2018 Form
Recapture of Credit 1099-PATR, box 10; for 2019, from the 2019 Form
You must pay a tax (recapture) on each gallon of second 1099-PATR, box 11; for 2020, from the 2020 Form
generation biofuel at the rate you used to figure the credit 1099-PATR, box 12.
if you don’t use the fuel for the purposes described under Partnerships, S corporations, cooperatives, estates,
Qualified Second Generation Biofuel Production, earlier. and trusts must always report the above credits on line 3.
Report the tax on Form 720, Quarterly Federal Excise All other taxpayers:
Tax Return. • Report the above credits directly on the appropriate line
of Form 3800.
Specific Instructions Example 8. For 2018, report this credit on the 2018
Form 3800, Part III, line 4c; for 2019, report this credit on
Line 1 the 2019 Form 3800, Part III, line 4c.
Enter the number of gallons of second generation biofuel • Don’t file Form 6478.
sold or used for the tax year that meets the conditions At the time these instructions went to print, the
listed under Qualified Second Generation Biofuel ! 2020 and later year tax forms hadn't been
Production, earlier. Multiply by the rate of $1.01 per CAUTION developed. Go to IRS.gov/Form6478 later this
gallon. year to determine which line to use.
Line 2
The credit shown in column (c) on line 1 must be included Line 4
in income under “other income” on the applicable line of For 2018, report this amount on the 2018 Form 3800, Part
your income tax return, even if you can’t use all of the III, line 4c; for 2019, report this amount on the 2019 Form
credit because of the tax liability limit. However, if you’re 3800, Part III, line 4c.
subject to the alternative minimum tax (AMT), this amount At the time these instructions went to print, the
isn’t income in figuring AMT and must be subtracted when ! 2020 and later year tax forms hadn't been
figuring your alternative minimum taxable income. Do this CAUTION developed. Go to IRS.gov/Form6478 later this
by including this amount on the appropriate line of Form year to determine which line to use.
6251 or Schedule I (Form 1041).
Example 3. For 2018, report this amount on the 2018
Form 6251, line 3, or Schedule I (Form 1041), line 23; for

-2- Instructions for Form 6478

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Line 5                                                            amended return within 6 months of the due date of the 
                                                                  return (excluding extensions). Write “Filed pursuant to 
Cooperatives. A cooperative described in section                  section 301.9100-2” on the amended return.
1381(a) can elect to allocate any part of the biofuel             Once made, the election can’t be revoked.
producer credit to patrons of the cooperative. The credit is 
allocated pro rata among the patrons eligible to share in         Estates and trusts.     Allocate the biofuel producer credit 
patronage dividends on the basis of the quantity or value         on line 4 between the estate or trust and the beneficiaries 
of business done with or for the patrons for the tax year.        in the same proportion as income was allocated and enter 
                                                                  the beneficiaries’ share on line 5.
  If the cooperative is subject to the passive activity rules, 
include on line 3 any Form 6478 credits from passive              If the estate or trust is subject to the passive activity 
activities disallowed for prior years and carried forward to      rules, include on line 3 any Form 6478 credits from 
this year. Complete Form 8810, Corporate Passive                  passive activities disallowed for prior years and carried 
Activity Loss and Credit Limitations, to determine the            forward to this year. Complete Form 8582-CR, Passive 
allowed producer credits that can be allocated to patrons.        Activity Credit Limitations, to determine the allowed credit 
For details, see the Instructions for Form 8810.                  that must be allocated between the estate or trust and the 
                                                                  beneficiaries. See the Instructions for Form 8582-CR.
  The cooperative is deemed to have made the election 
by completing line 5. However, the election isn’t effective       Line 6
unless:
                                                                  For 2018, report this amount on the 2018 Form 3800, Part 
• It’s made on a timely filed tax return (including 
                                                                  III, line 4c; for 2019, report this amount on the 2019 Form 
extensions), and
                                                                  3800, Part III, line 4c.
• The cooperative designates the apportionment in a 
written notice or on Form 1099-PATR mailed to its patrons                 At the time these instructions went to print, the 
during the payment period described in section 1382(d).           !       2020 and later year tax forms hadn't been 
  If you timely filed your return without making an               CAUTION developed. Go to IRS.gov/Form6478 later this 
election, you can still make the election by filing an            year to determine which line to use.

Paperwork Reduction Act Notice.    We ask for the information on this form to carry out the Internal Revenue laws of the 
United States. You’re required to give us the information. We need it to ensure that you’re complying with these laws and 
to allow us to figure and collect the right amount of tax.
  You aren’t required to provide the information requested on a form that’s subject to the Paperwork Reduction Act 
unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be 
retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax 
returns and return information are confidential, as required by section 6103.
  The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden 
for individual taxpayers filing this form is approved under OMB control number 1545-0074 and is included in the 
estimates shown in the instructions for their individual income tax return. The estimated burden for all other taxpayers 
who file this form is shown below.

Recordkeeping                                                                                               2 hr., 9 min.
Learning about the law or the form                                                                                       53 min.
Preparing and sending the form to the IRS                                                                                58 min.

  If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, 
we’d be happy to hear from you. See the instructions for the tax return with which this form is filed.

Instructions for Form 6478                                     -3-

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