qualified ethanol fuel production
(4) Small ethanol producer credit (A) In general The small ethanol producer credit of any eligible small ethanol producer for any taxable year is 10 cents for each gallon of qualified ethanol fuel production of such producer. (B) Qualified ethanol fuel production For purposes of this paragraph, the term “qualified ethanol fuel production” means any alcohol which is ethanol which is produced by an eligible small ethanol 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 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 ethanol at retail to another person and places such ethanol in the fuel tank of such other person, or (ii) is used or sold by such producer for any purpose described in clause (i). (C) Limitation The qualified ethanol fuel production of any producer for any taxable year shall not exceed 15,000,000 gallons (determined without regard to any qualified second generation biofuel production). (D) Additional distillation excluded The qualified ethanol fuel production of any producer for any taxable year shall not include any alcohol which is purchased by the producer and with respect to which such producer increases the proof of the alcohol by additional distillation.