ABC15 News Special Report: Is saving your gas receipts worth it?
Are you saving your gas receipts? What about your maintenance receipts?
It has been a month since the new gas tax law went into effect in South Carolina.
You can claim the increased cost when you file taxes next year but, how much will you actually save?
"I don't save them," said driver, Dennis King.
That is the response most drivers gave when asked if they have been saving their gas receipts.
Last July, the South Carolina gas tax jumped from 16 to 18 cents.
Starting this year, drivers can get a credit on their 2018 taxes for that increased cost if you save your receipts.
"I have no problem with the gas tax. It's for a good cause. We need the roads," said King.
Other drivers like Richard Pencille agree.
"I think the concept to improve the roads is needed," said Pencille.
Just this week, Lieutenant Governor Kevin Bryant told our Trey Paul on 'Carolina This Week' he does not save his gas receipts:
"I believe you're going to spend more money applying for that tax relief with your accountant." said Lt. Governor Bryant.
"No, I have not," said CPA Beth Fryar, with a laugh.
She admits she's not saving her gas receipts either.
"It's an extra two cents a gallon, but you'll get three cents credit," said Fryar, a CPA with Cooper & Jaskot, CPAs.
But it is only an extra two cents for the first half of 2018.
In July, the gas tax increases again another two cents to 20 cents a gallon.
But you will still get that three cent credit.
So how does that break out when you get ready to file your 2018 taxes next year?
For example, say you drive a sedan with a 16 gallon tank, and you fill up from empty once a week.
The gas tax increase will cost you an extra $25 by the end of 2018, but you could get that money back with the credit.
"For the average person, is it worth saving for 25 dollars?" asks Fryar.
If you think it is not worth it, you still may want to get in the habit.
The gas tax increases by another two cents in 2019 and will be up to 28 cents per gallon by the year 2022.
In the same example, by 2022, you will be spending an extra $91 a year.
"If you've got somebody like contractors, that use their own vehicles, and they're traveling all over the state working on jobs, and they're filling up their individual trucks two or three times a week, then yes, I would say it's worth it," said Fryar.
So where is the refund money coming from?
We asked state officials if they had enough money to pay back drivers.
For the first year, they have set aside $40 million.
But there is a catch; if more than $40 million is claimed, you may get less than you are owed.
"It just depends on how many taxpayers are going to take advantage of this," said Fryar.
Also consider you can only claim two vehicles.
If a couple owns three vehices and they are all registered under one name, it may be worth registering one under another name.
For those who think saving receipts is just too much work, and do not mind absorbing the extra cost, Fryar says there is a silver lining:
"We still have the lowest gas prices in the nation," said Fryar.
And possibly, better roads.
If you are still having trouble deciding what to do, it is best to talk to your tax profesional.
You do not have to turn in your receipts to the state, you just need them in case you get audited.
The credit also applies to preventative maintenance done on your car like oil changes or new tires.
You will get credit for the gas costs, or maintainence, whichever cost less.
You have to save those receipts, too, to calculate your refund.