Q. I had heard about something called the blenders credit at the coffee shop. Someone in the coffee shop was getting money back due to this credit. Did we miss that on our tax return?
A. Thanks for asking. We want to make sure that you are comfortable that we are getting all the deductions and credits. What you are referring to is the Small Producer’s Ethanol Credit. In order to qualify, the ethanol company that you are invested in must have a capacity of 60 million gallons or less. The ethanol company that you have invested in has a capacity of 200 million gallons; therefore, you do not qualify for this credit. What may be confusing is that on the tax K-1 from the company, there is a paragraph allocating gallons to each owner so that they can determine if they qualify for the small producer credit. This is informational only and only comes into play if you have other ethanol production. If you have other ethanol production, then you use these gallons to calculate whether or not they are still under the 60 million gallons of capacity.
