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Under newly provided IRS rules, there is now guidance on how a .50 cents/gallon income tax credit can be claimed for alternative fuel that is sold for use or used as fuel in a motor vehicle. For purposes of this credit, the term "alternative fuel" includes propane, and the term "motor vehicle" includes forklifts. Many forklifts are powered by the use of propane; the use of these forklifts will generate income tax credits.  For example: if you use a forklift approximately five hours a day during 2007 (2000 gallons of propane) @ .50 cents gallon = $1,000 tax credit. 

To qualify, you must register with the IRS (form 637). This process can take several weeks ,according to the IRS, in addition you will have to provide detailed records such as number of gallons used to cover the claim, dates of purchases, and names of suppliers. Furthermore, if you operated forklifts in the last three months of 2006, you might want to file an amended return to claim the credit for propane used from 10/1/2006 until the end of 2006.