### Question
How does Income Taxes define qualified agri-biodiesel production?


### Answer
Under *26 U.S.C. § 40A*, **qualified agri-biodiesel production** is defined as:

> any agri-biodiesel which is produced by an eligible small agri-biodiesel producer, and which during the taxable year—


(i) is sold by such producer to another person—


(I) for use by such other person in the production of a qualified biodiesel mixture in such other person's trade or business (other than casual off-farm production),


(II) for use by such other person as a fuel in a trade or business, or


(III) who sells such agri-biodiesel at retail to another person and places such agri-biodiesel in the fuel tank of such other person, or


  

(ii) is used or sold by such producer for any purpose described in clause (i)

#### Citation:
  - *26 U.S.C. § 40A*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter A-Determination of Tax Liability > PART IV-CREDITS AGAINST TAX > Subpart D-Business Related Credits**

