The bill amends Chapter 44-30 of the General Laws regarding personal income tax by introducing a new section, 44-30-28, which establishes a tax credit for individual taxpayers who convert their gas-powered vehicles to operate on alternative fuel sources. The credit allows individuals to claim up to 50% of the equipment and labor costs incurred for the conversion, with a maximum limit of $2,000 for vehicles weighing 10,000 pounds or less, and $3,000 for vehicles over 10,000 pounds. Additionally, the bill specifies that sellers of alternative fuel are not eligible to claim credits for converting their own vehicles.

The definition of "alternative fuel" includes natural gas, liquified petroleum gas, liquified natural gas, hydrogen, cooking oil, electricity, and any fuel that consists of at least 85% methanol, ethanol, or other alcohols, ethers, or combinations thereof. The credit is limited to the taxpayer's income tax liability, and there is no provision for carryback or carryforward of the credit; it must be applied in the year the conversion is made, as determined by the taxpayer's accounting method. This act is set to take effect for the tax year beginning January 1, 2026.