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Waiting In the Shadows: Rediscovering Federal and State Fuel Tax Refunds

October 2, 2014
 / Equipment / 

NECS072_barslogan2009Refunds? Does that word even exist anymore? Yes, believe it or not, fuel excise tax refunds are still alive and well, but in today’s hurried business environment fleet managers and owners are preoccupied by the steady stream of new and expensive federal regulations aimed at transportation and vocational fleets. Unfortunately, those distracting regulations create complex compliance challenges leaving behind the forgotten or narrowed practice of pursuing fuel tax refunds.

From an economic standpoint, engaging or re-engaging processes to track fuel, qualify equipment, document locations and calculate refunds bring needed operating capital back into the business. Also known within the industry as “recoveries” or “rebates”, the laws covering eligible fuel use for tax refund purposes vary widely between federal and non-federal taxing agencies. Diesel particulate filters (DPF) offer the most recent government nod for federal fuel tax refund opportunities in addition to auxiliary power units (APU), non-licensed off-road equipment and other non-propulsion engines from pony motors to deck engines. For state fuel tax refunds, the two most common fuel allowances are power take-off (PTO) and off-road fuel.
Even within the most common of fuel allowances, caveats abound. Some states, Indiana and California for example, may grant refunds on gasoline, diesel and alternative fuels, while other states like Texas, may limit the scope of refunds to fewer fuel types or narrower qualified fuel uses. Another important item to consider is the statutes of limitation; the timeframe controls between purchasing the fuel, dispensing the fuel and filing the claims for refund with the appropriate taxing agencies.

Overwhelmed yet? Pursuing those fuel tax refunds can involve a lot of detailed and time intensive work, but no worries ... companies who lack the knowledge, time and internal staff to pursue those refunds can easily outsource the recovery function to a fuel tax professional like NECS®. In practice, a business should never leave its own money on the table and walk away. Those overpaid fuel tax dollars rightfully belong in the revenue ledger.

NECS® is a privately held company, providing professional services to the transportation industry in North America for nearly 30 years. Deena J. Lewis serves as its Vice President of Tax Recovery Services. For more information, visit www.NECSsolutions.com and select Cost Reduction Services / Tax Recovery Services or call 800.348.3242.

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