Montana Oil Seed Crushing and Biodiesel/Biolubricant Production Facilities

Oil Seed Crushing and Biodiesel/Biolubricant Production Facilities
Form OSC (Obsolete)
Clear Form

2014 Oilseed Crushing and
and Biodiesel/Biolubricant Production Facilities Credit

MONTANA
OSC
Rev 04 14

15-32-701 and 15-32-702, MCA

Name (as it appears on your Montana tax return)
Social Security
Number

-

-

OR

Federal Employer
Identification Number

-

Part I. Partners in a Partnership or Shareholders of an S Corporation
Enter your portion of the oilseed crushing and biodiesel/biolubricant production
$____________________
facilities credit here. See instructions.
Business Name of Partnership or S Corporation
Federal Employer
Identification Number
_________________________________________________

Part II. Oilseed Crushing Facility Credit
Please enter the date that you began crushing oilseed________________________________________
To qualify for the oilseed crushing facility credit, you are required to answer “Yes” to the following
questions.
1. Is the machinery or equipment located in Montana used primarily to crush oilseed to be
used in the production of biodiesel or biolubricant?......................................................... q	Yes	 q	No
2. Did you crush oilseed or manufacture a product from the oilseed during the year?........ q	Yes	 q	No
3. List the property purchased that qualifies you for this credit. Include a copy of your invoice that identifies
the date purchased, description of the property and the amount you paid for the property.
Date Purchased
Description of Property
Cost
a.

a.

b.

b.

c.

c.

4. Add lines 3a through 3c above and enter the result here.................................................4.
5. Multiply the amount on line 4 by 15% (0.15) and enter the result here, but not more than
$500,000. This is your oilseed crushing facility credit...............................................5.
Part III. Biodiesel/Biolubricant Production Facility Credit
Please enter the date that you began producing biodiesel or biolubricant___________
6. Enter the total cost of constructing a facility in Montana that is used to produce
biodiesel/biolubricant. Include all supporting invoices, contracts, etc. that substantiate
these costs.......................................................................................................................6.
7. Enter the total cost of any equipment purchased to operate a facility in Montana that is
used to produce biodiesel/biolubricant. Include all supporting invoices, contracts, etc.
that substantiate the cost of this equipment.....................................................................7.
8. Add lines 6 and 7 and enter the result here.....................................................................8.
9. Multiply the amount on line 8 by 15% (0.15) and enter the result here. This is your
biodiesel/biolubricant production facility credit.........................................................9.
(Continued on the next page)

	SSN	
-

	FEIN	
-

Part IV. Combined Oilseed Crushing and Biodiesel/Biolubricant Production Facilities Credit
10. Enter the amount of tax credit being carried forward from previous years. (Please
include a schedule showing the years and amount of carryover.)..................................10.
11. Add the amounts on lines 5, 9 and 10 and enter the result here. This is your combined
oilseed crushing and biodiesel/biolubricant production facilities credit............... 11.
Where to Report Your Credit
	 ► Individuals: Form 2, Schedule V	
	 ► C corporations: Form CIT, Schedule C	

► S corporations: Form CLT-4S, Schedule II
► Partnerships: Form PR-1, Schedule II

If you file your Montana tax return electronically, you do not need to mail this form to us unless we ask you for a copy. When you file electronically,
you represent that you have retained the required documents in your tax records and will provide them upon the department’s request.

Form OSC Instructions
Biodiesel is a fuel produced from monoalkyl esters of longchain fatty acids derived from vegetable oils, renewable
lipids, animal fats, or any combination of these ingredients.
This fuel must meet the requirements of ASTM D6751, also
known as the Standard Specification for Biodiesel Fuel
(B-100) Blend Stock for Distillate Fuels, as adopted by the
American Society for Testing and Materials.
Biolubricant is a product, other than food or feed,
substantially composed of certain biological products,
agricultural materials or forestry materials. The product is
used in place of a petroleum-based lubricant.
What information do I have to include with my tax
return when I claim this credit?
●● Individuals. If you are filing a paper return, include
a copy of Form OSC with your individual income tax
return.
●● C corporations. If you are filing a paper return, include
a copy of Form OSC with your corporate income tax
return.
●● S corporations and partnerships. If you are an
entity taxed as an S corporation or a partnership and
are claiming this credit, include Form OSC with your
Montana information return Form CLT-4S or PR-1 and
include a separate statement identifying each owner
and their share.
You will need to complete a separate Form OSC for each
source you are receiving the credit from. For example, if
you are a partner in one partnership that qualifies for this
credit, and you, as an individual, also qualify for this credit,
you would need to complete two forms.

If you file electronically, you do not need to mail this form to
us unless we contact you for a copy.
Am I subject to recapturing the credit that I previously
received if I cease operating my business?
Yes, you are. If you cease operating your business for a
period of 12 continuous months, within five years from the
year you claimed the credit, you are required to recapture
this credit in the year you ceased operations.
If my business is a partnership or an S corporation,
are my partners or shareholders entitled to the oilseed
crushing and biodiesel/biolubricant production
facilities credit?
As a partnership, your partners are entitled to apply these
credits against their income tax or corporate income tax
liability.
As an S corporation, the shareholders are entitled to apply
these credits against their income tax or corporate income
tax liability. The amount of each shareholder’s credit is
based on their pro rata share of the corporation’s cost of
investing in equipment or the facility.

Part I. Partners in a Partnership or Shareholders
of an S Corporation
How do I claim my credit when I am a partner or
shareholder in a partnership or S corporation?
If you received this credit from a partnership or S
corporation, you will need to fill out Part I in its entirety.
Your portion of the credit can be obtained from the Montana
Schedule K-1 that you received from the entity. In addition
to reporting your portion of the credit, you will need to
provide the partnership’s or S corporation’s name and
Federal Employer Identification Number.

If you are a partner or shareholder in more than one
partnership or S corporation, you will need to complete a
separate Form OSC for each entity you are receiving the
credit from.

Part II. Oilseed Crushing Facility Credit
I purchased equipment to begin crushing oilseed but
have not completed installation or begun crushing the
oilseed. Am I eligible for the oilseed crushing facility
credit in the year I purchase the equipment?
No, you are not. The investment you have made in the
equipment does not allow you to apply for the oilseed
crushing facility credit until the first year your facility begins
processing oilseed or your facility manufactures a product
from oilseed.
The costs incurred in the two years before you began
crushing oilseed are eligible for the credit.
What cost do I use to calculate my oilseed crushing
facility credit?
The cost used to calculate your oilseed crushing facility
credit is the amount of the investment that you have made
in the specific property used to calculate your depreciation
deduction for federal income tax purposes. It does not
include the installation cost of the equipment.
If I am claiming the oilseed crushing facility credit,
can I also deduct the annual depreciation on my
investment?
Yes, you can. This credit is not in lieu of any depreciation
or amortization deduction that you are allowed for your
investment.
What requirements do I have to meet in order to qualify
for the oilseed crushing facility credit?
In order for your investment to qualify for this credit the
following requirements must be met:
●● The property is used primarily to crush oilseed or to
manufacture a product from oilseed and is operational
before January 1, 2015.
●● You are an individual or entity who as the owner,
including a contract purchaser, has a beneficial interest
in the business that crushes oilseed or manufacturers a
product from oilseed.
●● Your business has been processing oilseed or
manufacturing a product from oilseed during your tax
year.

Part III. Biodiesel/Biolubricant Production Facility
Credit
I am constructing a facility to produce biodiesel/
biolubricant. What costs are available to me to be
eligible for the biodiesel/biolubricant production facility
tax credit?
The costs used to calculate your biodiesel/biolubricant
production facilities credit are the costs of investing in
depreciable property for constructing or equipping your
facility.

The costs incurred in the two years before you began
production are eligible for the credit.
If I am claiming the biodiesel/biolubricant production
facility credit, can I also deduct the annual depreciation
on my investment?
Yes, you can. This credit is not in lieu of any depreciation
or amortization deduction that you are allowed for your
investment.
When am I eligible for the biodiesel/biolubricant
production facility credit?
You are eligible to claim the biodiesel/biolubricant
production facility credit in a tax year that your facility
produces this product. If you are in the process of
constructing a facility in one tax year but have not begun
processing in the same tax year, you are not eligible for this
credit until the year your production begins.
What requirements do I have to meet in order to qualify
for the biodiesel/biolubricant production facility credit?
In order for your investment to qualify for this credit, the
following requirements must be met:
●● The property is used primarily to manufacture biodiesel
or biolubricant and is operational before January 1,
2015.
●● You are an individual or entity who as the owner,
including a contract purchaser, has a beneficial
interest in the business that manufactures biodiesel or
biolubricant.
●● Your business has been manufacturing biodiesel or
biolubricant during your tax year.

Part IV. Combined Oilseed Crushing and
Biodiesel/Biolubricant Production Facilities Credit
Am I able to carry forward my oilseed crushing facility
credit or my biodiesel/biolubricant production facility
credit if I cannot apply the full amount against my tax
liability in the first year of production?
Yes, the credits can be carried forward for up to seven
years. However, if you are not crushing oilseed or
producing biodiesel or biolubricant, you cannot claim any
tax credit for that year.
Administrative Rules of Montana: 42.4.2501 through
42.4.2503
Questions? Please call us toll free at (866) 859-2254 (in
Helena, 444-6900).