Schedule 1 nontaxable use of fuels

Schedule 1 is a part of IRS Form 8849, Claim for Refund of Excise Taxes. It is used to claim a refund of federal excise tax paid on fuels that were used for nontaxable purposes.

This schedule applies when fuel is purchased with federal excise tax included, but is later used in a manner that is not taxable under IRS regulations. Typically, the claim is filed by ultimate purchaser of the fuel.
Using Form 8849 Schedule 1, a taxpayer can claim a refund of federal excise taxes paid on fuels used. A taxpayer has to file the schedule to not only claim the tax benefits but also to abide by the federal excise tax laws.

Who Is Required to File Form 8849
Schedule 1?

Form 8849 Schedule 1 may be filed by businesses, organizations, or government entities that are the end users of fuel and use that fuel for nontaxable purposes.

Businesses using fuel for off-highway operations

Construction, mining, and industrial companies

Nonprofit and educational institutions

Agricultural and farming operations

Federal, state, and local government agencies

Transit systems and bus
operators

Specific Instructions for Form 8849
Schedule 1

Claim
Requirements

To submit a valid refund claim using Schedule 1:

The total refund amount claimed must be $750 or more per quarterly claim
The claimant must be the ultimate purchaser of the fuel.
Claims must be filed by the last day of the 6th month after the quarter of use (e.g., Q1 use due June 30).
Fuel must have been used for an IRS-recognized nontaxable purpose.

Total Refund
Calculation

Accurate calculations are required to prevent IRS delays or claim rejections.

Enter the number of gallons and applicable tax rate for each fuel line.
Add all amounts in column (d) and enter the total refund in the box at the top of Schedule 1.
Compute the claim amount for each entry in column (d).

Type of Use Classification

Incorrect use of codes may result in claim denial or additional IRS review.

Fuel claimed must correspond to a valid Type of Use listed in the IRS instructions for Schedule 1 (lines 1 through 7).
Each fuel and usage combination must be reported on the appropriate line.
The Type of Use Table in the Form 8849 instructions must be used to select the correct use code.

Exported Taxable
Fuel

For claims involving exported taxable fuel, the claimant must retain proof of export. Acceptable documentation includes:

Export bill of lading
Certificate of exportation
Statement from the foreign consignee

How to File Schedule 1

1. Gather Your Docs

Gather invoices proving excise tax on fuel buys, usage logs showing nontaxable use (like off-highway), and IRS codes from the Type of Use Table.

2. Fill the Forms

Enter gallons, rate (¢/gal), and claim per line on Schedule 1. Total it on Form 8849; must hit $750 minimum.

3. Choose Your Method

Mail paper forms to the IRS address listed in the instructions, or e-file through an IRS-authorized provider for fast and accurate IRS confirmation.

4. Hit the Deadline

File quarterly (e.g., Q1 by June 30). E-filing provides immediate IRS confirmation.

5. Maintain Records and Monitor Status

Store all the records for at least 3 years and monitor status via your provider's portal (expect 6-12 weeks).

Benefits of Filing Through Our Platform

Verify Eligibility

Verify eligibility before submission
Categories Use

Use the right fuel and consumption categories
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Monitor and Confirm

Monitor the Filing Status and Confirmations

Fuel Types Covered

Gasoline

Aviation gasoline

Dyed & Undyed Diesel

Certain alternative fuels

K-1 Kerosene

Nontaxable Uses of Fuel

Fuel may qualify for a refund when used in activities that are not subjectto federal excise tax, including:

Off-highway business
use

Certain governmental
functions

Farming and agricultural operations

Stationary machinery or equipment use

Non-commercial aviation
use

Industrial or heating
purposes

Schedule 1 Filing Requirements

File Schedule 1 along with Form 8849
Meet the IRS minimum claim amount requirement
Maintain records supporting fuel purchase and usage
Submit claims every quarter
Use the correct IRS-assigned fuel and usage codes

Filing Deadlines

Quarter of Fuel Use	Filing Period	Due Date
Jan-Mar (Q1)	Apr 1 - Jun 30	Jun 30
Apr-Jun (Q2)	Jul 1 - Sep 30	Sep 30
Jul-Sep (Q3)	Oct 1 - Dec 31	Dec 31
Oct-Dec (Q4)	Jan 1 - Mar 31	Mar 31

Frequently Asked Questions

Form 8849 Schedule 1 claims refunds for federal excise tax on the use of fuels for nontaxable operations.

Eligible taxpayers and businesses using fuel for nontaxable purposes can file Schedule 1.

Yes, Schedule 1 can be submitted electronically through IRS-authorized e-file providers.

Keep fuel purchase invoices, usage logs, and IRS fuel codes for at least three years.

Schedule 1 is filed quarterly along with Form 8849.

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Schedule 1: Nontaxable Use of Fuels - Form 8849

Schedule 1 is a part of IRS Form 8849, Claim for Refund of Excise Taxes. It is used to claim a refund of federal excise tax paid on fuels that were used for nontaxable purposes.

Who Is Required to File Form 8849
Schedule 1?

Businesses using fuel for off-highway operations