Wood Energy Tax Credit

Wood Energy Tax Credit as described in Sections 135.300-135.311, RSMo. 

The credit was originally enacted in 1985 to provide an incentive to sawmills to make 
fuel pellets from their sawdust instead of letting the sawdust pile up on sawmill 
property; the credit expired on June 30, 1991. The tax credit was reenacted in 1996 
but was changed to extend the eligibility of the credit to include charcoal producers. 
The credit also encouraged the use of wood pellets as an energy source instead of 
natural gas. 

The credit is worth $5 per ton of wood pellets or wood flour produced and is worth 
$20 for each ton of wood char produced. The EPA has determined that four tons of 
wood residue is needed to produce one ton of wood char. 

Documentation of the sale of the processed wood is required to receive the credit. 

The Department of Natural Resources certifies to the Department of Revenue that a 
wood energy tax credit applicant qualifies as a wood energy-producing facility.