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Federal Excise Tax Exemptions on Trucks 2024

Federal Excise Tax Exemptions on Trucks 2024


Filing excise tax is one thing, and looking for exemptions is another and most happening thing, as it's a matter of saving some bucks in the pocket. If you've been operating trucks and want tax exemptions on trucks, here are a few exemptions that you can look at in the blog:

Exemption 1

Automobile truck bodies and chassis with a gross vehicle weight of 33,000 lb. or less, truck trailer and semi-trailer bodies and chassis for use with a trailer or semi-trailer having a gross vehicle weight of 26,000 lb. or less, and tractors mainly used for highway transportation with a trailer or semi-trailer having a gross vehicle weight of 19,500 lb. or less and a gross combined weight of 33,000 lb. or less are exempted from federal excise tax.

Exemption 2

Certain exceptions are in place, like components incorporated into bodies, chassis, or tractors before their initial retail sale, where excise tax has already been settled (for instance, tires); bodies and chassis with a gross vehicle weight below the previously mentioned standards; and idle reduction technologies, among others.

Exemption 3

For certain types of truck bodies, the IRS agrees with the seller that they don't have to pay certain taxes. This applies to:

  1. Platform truck bodies that are 21 feet long or shorter.
  2. Dry freight and refrigerated truck van bodies that are 24 ft. long or shorter.
  3. Dump truck bodies that can carry 8 cubic yards or less.
  4. Refuse packer truck bodies that can carry 20 cubic yards or less

Exemption 4

According to IRS Section 4053, certain products are exempt from excise taxes. This includes things like bodies made specifically for processing, hauling, and spreading feed, seed, and fertilizers, and used exclusively for those purposes.

Some things that don't have taxes include house trailers, ambulances, hearses, and special equipment like concrete mixers and devices that help save fuel when the vehicle is not in use.

When it comes to the exemption for mobile machinery, there are specific conditions for a mobile chassis to be eligible. It must be permanently affixed, and utilized for tasks such as construction, manufacturing, farming, mining, drilling, timbering, or similar activities, with minimal use for public highway transportation.

Furthermore, the chassis should be specially designed to transport its mobile machinery, and its unique design should make it unsuitable for any other purpose without significant structural alterations.

Read our blog on the federal excise tax on trucks to understand eligibility criteria.

Exemption 5

Here are some scenarios where you might not need to pay the retail tax when purchasing heavy trucks, trailers, or tractors:

  1. If the sale is to a state or local government and they're getting it for their own use.
  2. . In specific situations, sales to tribal governments could be exempt, depending on how they intend to use the vehicles.
  3. If you're buying the truck, trailer, or tractor to use in creating other taxable items, there's a chance you won't have to pay the retail tax.

Exemption 6

If your commercial vehicle travels less than 5,000 miles annually, your agricultural vehicle covers less than 7,500 miles each year, and your vehicle isn't classified as a highway motor vehicle, you may be eligible for exemptions from specific requirements or taxes.

The Wrap

If you have been missing these tax exemptions earlier, ensure that you won't anymore and carefully consider it the next time you file. If you've been filing excise taxes manually and mailing them to the IRS, this time why not file them electronically?

With simple 720, it's possible to do so. Reach us today for your form 720 filing!

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