Diesel particulate filters: Taxation and credits

Posted by Rypos on Jul 6, 2018 11:00:00 AM

In 2007, the Environmental Protection Agency (EPA) implemented new vehicle-emission standards for diesel-powered vehicles, mandating, among other things, the adoption of specific procedures for exhaust regeneration. To meet these standards, diesel-powered vehicles are now equipped with DPFs. DPFs can cost $5,000 to $15,000. 

Mary Van Leuven, J.D., LL.M. discuss findings from the IRS and the U.S. District Court for the Northern District of Iowa that view DPFs as taxable parts and accessories for purposes of the tax. However, an excise tax credit may be available with respect to diesel fuel used in the DPF that does not enter the combustion chamber of the propulsion engine.

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Tags: Diesel Particulate Filter, Transportation, Taxation