IRC 4051(d) Tire Credit on Heavy Trucks Explained
Why the credit exists
The 12% retail tax applies to a vehicle's sale price — which includes its tires. But those tires may have already been taxed under the federal tire excise tax. Section 4051(d) prevents that double taxation by excluding the previously-taxed tire value from the base the 12% is applied to.
How it works on Form 720
Reduce the taxable sale price by the portion attributable to the previously-taxed tires, then apply 12% to the reduced base for IRS No. 33. Keep records of the tires and their prior tax. See the 12% heavy truck tax overview and the tire excise tax guide.
FAQ
What is the Section 4051(d) tire credit?▼
When a taxable heavy vehicle is sold with tires that were already subject to the federal tire excise tax, Section 4051(d) lets the seller reduce the taxable sale price by the portion attributable to those tires — preventing the same tires from being taxed twice (once as tires, once inside the 12% truck tax).
How does the tire credit lower my 12% truck tax?▼
You exclude the value of the previously-taxed tires from the price the 12% retail tax is applied to. A lower taxable base means a lower IRS No. 33 liability, so the truck tax is not stacked on top of tax the tires already bore.
Do I need records to claim the 4051(d) adjustment?▼
Yes. Keep documentation of the tires on the vehicle and that the tire excise tax applied to them. EasyFile720 supports the 4051(d) adjustment in the heavy truck workflow so the taxable base is reduced correctly.
Apply the 4051(d) credit automatically
EasyFile720 reduces the taxable base for previously-taxed tires and e-files IRS No. 33 for dealers.
Reflects the Instructions for Form 720 (Rev. June 2026) and IRC §4051(d). General information, not tax advice.
