HB1390ham001 104TH GENERAL ASSEMBLY

Rep. Jay Hoffman

Filed: 2/18/2025

10400HB1390ham001 LRB104 07494 HLH 22458 a

AMENDMENT TO HOUSE BILL 1390

AMENDMENT NO. ______. Amend House Bill 1390 by replacing everything after the enacting clause with the following:

"Section 5. The Motor Fuel Tax Law is amended by changing Sections 1.2, 1.20, 3, 3d, 5, 6, 7, 11.5, 12, 12a, 13, 14a, 15, and 16 as follows:

(35 ILCS 505/1.2) (from Ch. 120, par. 417.2)

Sec. 1.2. Distributor. "Distributor" means a person who operates an Illinois bulk plant where the person has active bulk storage capacity of not less than 20,000 gallons for motor fuel and who does any of the following: (1) either (i) produces motor fuel in this State; (2) , refines motor fuel in this State; (3) , blends motor fuel in this State; (4) , compounds motor fuel in this State; (5) or manufactures motor fuel in this State; (6) , or (ii) transports motor fuel into this State; (7) , or (iii) exports motor fuel out of this State; or (8) distributes , or (iv) engages in the distribution of motor fuel primarily by tank car or tank truck, or both, and who operates an Illinois bulk plant where he or she has active bulk storage capacity of not less than 30,000 gallons for gasoline as defined in item (A) of Section 5 of this Law.

"Distributor" does not, however, include a person who receives or transports into this State and sells or uses motor fuel under such circumstances as preclude the collection of the tax herein imposed, by reason of the provisions of the constitution and statutes of the United States. However, a person operating a motor vehicle into the State, may transport motor fuel in the ordinary fuel tank attached to the motor vehicle for the operation of the motor vehicle, without being considered a distributor. Any railroad registered under Section 18c-7201 of the Illinois Vehicle Code may deliver special fuel directly into the fuel supply tank of a locomotive owned, operated, or controlled by any other railroad registered under Section 18c-7201 of the Illinois Vehicle Code without being considered a distributor or supplier.

(Source: P.A. 96-1384, eff. 7-29-10.)

(35 ILCS 505/1.20) (from Ch. 120, par. 417.20)

Sec. 1.20. "Receiver" means a person who operates an Illinois bulk plant where the person has active fuel bulk storage capacity of not less than 20,000 gallons and who does any of the following: (1) either produces, refines, blends, compounds or manufactures fuel in this State; (2) , or transports fuel into this State; (3) or receives fuel transported to him from without the State; (4) or exports fuel out of this State; or (5) distributes , or who is engaged in distribution of fuel primarily by tank car or tank truck, or both, and who operates an Illinois bulk plant where he has active fuel bulk storage capacity of not less than 30,000 gallons.

(Source: P.A. 86-125; 86-958.)

(35 ILCS 505/3) (from Ch. 120, par. 419)

Sec. 3. Application for distributor's license.

(a) No person shall act as a distributor of motor fuel within this State without first securing a license to act as a distributor of motor fuel from the Department. Application for such license shall be made to the Department upon blanks furnished by it. The application shall be signed and verified, and shall contain such information as the Department deems necessary. A blender shall, in addition to securing a distributor's license, make application to the Department for a blender's permit, setting forth in the application such information as the Department deems necessary. The applicant for a distributor's license shall also file with the Department a bond on a form to be approved by and with a surety or sureties satisfactory to the Department conditioned upon such applicant paying to the State of Illinois all monies becoming due by reason of the sale, export, or use of motor fuel by the applicant, together with all penalties and interest thereon. The Department shall fix the penalty of such bond in each case taking into consideration the amount of motor fuel expected to be sold, distributed, exported, and used by such applicant and the penalty fixed by the Department shall be such, as in its opinion, will protect the State of Illinois against failure to pay the amount hereinafter provided on motor fuel sold, distributed, exported, and used, but the amount of the penalty fixed by the Department shall not exceed twice the monthly amount that would be collectable as a tax in the event of a sale on all the motor fuel sold, distributed, exported, and used by the distributor inclusive of tax-free sales, exports, use, or distribution. Upon receipt of the application and bond in proper form, the Department shall issue to the applicant a license to act as a distributor. No person who is in default to the State for monies due under this Act for the sale, distribution, export, or use of motor fuel shall receive a license to act as a distributor.

(b) A license shall not be granted to any person whose principal place of business is in a state other than Illinois, unless such person is licensed for motor fuel distribution or export in the state in which the principal place of business is located and that such person is not in default to that State for any monies due for the sale, distribution, export, or use of motor fuel.

(c) On January 1, 2026, all valid and unrevoked supplier's licenses and their corresponding receiver's licenses issued by the Department shall be converted by the Department to distributor's licenses and corresponding receiver's licenses. Beginning on January 1, 2026, holders of these converted distributor's licenses shall be subject to the same provisions and requirements as other licensed distributors under this Law.

(Source: P.A. 96-1384, eff. 7-29-10.)

(35 ILCS 505/3d)

Sec. 3d. Right to blend.

(a) A distributor who is properly licensed and permitted as a blender pursuant to this Act may blend petroleum-based diesel fuel with biodiesel and sell the blended or unblended product on any premises owned and operated by the distributor for the purpose of supporting or facilitating the retail sale of motor fuel.

(b) A refiner or distributor supplier of petroleum-based diesel fuel or biodiesel shall not refuse to sell or transport to a distributor who is properly licensed and permitted as a blender pursuant to this Act any petroleum-based diesel fuel or biodiesel based on the distributor's or dealer's intent to use that product for blending.

(Source: P.A. 102-700, eff. 4-19-22.)

(35 ILCS 505/5) (from Ch. 120, par. 421)

Sec. 5. Distributor's monthly return. Except as hereinafter provided, a person holding a valid unrevoked license to act as a distributor of motor fuel shall, between the 1st and 20th days of each calendar month, make return to the Department, showing an itemized statement of the number of invoiced gallons of motor fuel of the types specified in this Section which were purchased, acquired, received, or exported during the preceding calendar month; the amount of such motor fuel produced, refined, compounded, manufactured, blended, sold, distributed, exported, and used by the licensed distributor during the preceding calendar month; the amount of such motor fuel lost or destroyed during the preceding calendar month; the amount of such motor fuel on hand at the close of business for such month; and such other reasonable information as the Department may require. If a distributor's only activities with respect to motor fuel are either: (1) production of alcohol in quantities of less than 10,000 proof gallons per year or (2) blending alcohol in quantities of less than 10,000 proof gallons per year which such distributor has produced, he shall file returns on an annual basis with the return for a given year being due by January 20 of the following year. Distributors whose total production of alcohol (whether blended or not) exceeds 10,000 proof gallons per year, based on production during the preceding (calendar) year or as reasonably projected by the Department if one calendar year's record of production cannot be established, shall file returns between the 1st and 20th days of each calendar month as hereinabove provided.

The types of motor fuel referred to in the preceding paragraph are: (A) All products commonly or commercially known or sold as gasoline (including casing-head and absorption or natural gasoline), gasohol, motor benzol or motor benzene regardless of their classification or uses; and (B) all combustible gases, not including liquefied natural gas, which exist in a gaseous state at 60 degrees Fahrenheit and at 14.7 pounds per square inch absolute including, but not limited to, liquefied petroleum gases used for highway purposes; and (C) special fuel. Only those quantities of combustible gases (example (B) above) which are used or sold by the distributor to be used to propel motor vehicles on the public highways, or which are delivered into a storage tank that is located at a facility that has withdrawal facilities which are readily accessible to and are capable of dispensing combustible gases into the fuel supply tanks of motor vehicles, shall be subject to return. Distributors of liquefied natural gas are not required to make returns under this Section with respect to that liquefied natural gas unless (i) the liquefied natural gas is dispensed into the fuel supply tank of any motor vehicle or (ii) the liquefied natural gas is delivered into a storage tank that is located at a facility that has withdrawal facilities which are readily accessible to and are capable of dispensing liquefied natural gas into the fuel supply tanks of motor vehicles. For purposes of this Section, a facility is considered to have withdrawal facilities that are not "readily accessible to and capable of dispensing combustible gases into the fuel supply tanks of motor vehicles" only if the combustible gases or liquefied natural gas are delivered from: (i) a dispenser hose that is short enough so that it will not reach the fuel supply tank of a motor vehicle or (ii) a dispenser that is enclosed by a fence or other physical barrier so that a vehicle cannot pull alongside the dispenser to permit fueling. For the purposes of this Act, liquefied petroleum gases shall mean and include any material having a vapor pressure not exceeding that allowed for commercial propane composed predominantly of the following hydrocarbons, either by themselves or as mixtures: Propane, Propylene, Butane (normal butane or iso-butane) and Butylene (including isomers).

In case of a sale of special fuel to someone other than a licensed distributor, or a licensed supplier, for a use other than in motor vehicles, the distributor shall show in his return the amount of invoiced gallons sold and the name and address of the purchaser in addition to any other information the Department may require.

All special fuel sold or used for non-highway purposes must have a dye added in accordance with Section 4d of this Law.

In case of a tax-free sale, as provided in Section 6, of motor fuel which the distributor is required by this Section to include in his return to the Department, the distributor in his return shall show: (1) If the sale is made to another licensed distributor the amount sold and the name, address and license number of the purchasing distributor; (2) if the sale is made to a person where delivery is made outside of this State the name and address of such purchaser and the point of delivery together with the date and amount delivered; (3) if the sale is made to the Federal Government or its instrumentalities the amount sold; (4) if the sale is made to a municipal corporation owning and operating a local transportation system for public service in this State the name and address of such purchaser, and the amount sold, as evidenced by official forms of exemption certificates properly executed and furnished by such purchaser; (5) if the sale is made to a privately owned public utility owning and operating 2-axle vehicles designed and used for transporting more than 7 passengers, which vehicles are used as common carriers in general transportation of passengers, are not devoted to any specialized purpose and are operated entirely within the territorial limits of a single municipality or of any group of contiguous municipalities or in a close radius thereof, and the operations of which are subject to the regulations of the Illinois Commerce Commission, then the name and address of such purchaser and the amount sold as evidenced by official forms of exemption certificates properly executed and furnished by the purchaser; (6) if the product sold is special fuel and if the sale is made to a licensed supplier under conditions which qualify the sale for tax exemption under Section 6 of this Act, the amount sold and the name, address and license number of the purchaser; and (6) (7) if a sale of special fuel is made to someone other than a licensed distributor, or a licensed supplier, for a use other than in motor vehicles, by making a specific notation thereof on the invoice or sales slip covering such sales and obtaining such supporting documentation as may be required by the Department.

All special fuel sold or used for non-highway purposes must have a dye added in accordance with Section 4d of this Law.

A person whose license to act as a distributor of motor fuel has been revoked shall make a return to the Department covering the period from the date of the last return to the date of the revocation of the license, which return shall be delivered to the Department not later than 10 days from the date of the revocation or termination of the license of such distributor; the return shall in all other respects be subject to the same provisions and conditions as returns by distributors licensed under the provisions of this Act.

The records, waybills and supporting documents kept by railroads and other common carriers in the regular course of business shall be prima facie evidence of the contents and receipt of cars or tanks covered by those records, waybills or supporting documents.

If the Department has reason to believe and does believe that the amount shown on the return as purchased, acquired, received, exported, sold, used, lost or destroyed is incorrect, or that an amount of motor fuel of the types required by the second paragraph of this Section to be reported to the Department has not been correctly reported the Department shall fix an amount for such receipt, sales, export, use, loss or destruction according to its best judgment and information, which amount so fixed by the Department shall be prima facie correct. All returns shall be made on forms prepared and furnished by the Department, and shall contain such other information as the Department may reasonably require. The return must be accompanied by appropriate computer-generated magnetic media supporting schedule data in the format required by the Department, unless, as provided by rule, the Department grants an exception upon petition of a taxpayer. All licensed distributors shall report all losses of motor fuel sustained on account of fire, theft, spillage, spoilage, leakage, or any other provable cause when filing the return for the period during which the loss occurred. If the distributor reports losses due to fire or theft, then the distributor must include fire department or police department reports and any other documentation that the Department may require. The mere making of the report does not assure the allowance of the loss as a reduction in tax liability. Losses of motor fuel as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of the month, plus the receipts of gallonage during the month, minus the gallonage remaining in storage at the end of the month. Any loss reported that is in excess of 1% shall be subject to the tax imposed by Section 2 of this Law. On and after July 1, 2001, for each 6-month period January through June, net losses of motor fuel (for each category of motor fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each January, plus the receipts of gallonage each January through June, minus the gallonage remaining in storage at the end of each June. On and after July 1, 2001, for each 6-month period July through December, net losses of motor fuel (for each category of motor fuel that is required to be reported on a return) as the result of evaporation or shrinkage due to temperature variations may not exceed 1% of the total gallons in storage at the beginning of each July, plus the receipts of gallonage each July through December, minus the gallonage remaining in storage at the end of each December. Any net loss reported that is in excess of this amount shall be subject to the tax imposed by Section 2 of this Law. For purposes of this Section, "net loss" means the number of gallons gained through temperature variations minus the number of gallons lost through temperature variations or evaporation for each of the respective 6-month periods.

If any payment provided for in this Section exceeds the distributor's liabilities under this Act, as shown on an original return, the Department may authorize the distributor to credit such excess payment against liability subsequently to be remitted to the Department under this Act, in accordance with reasonable rules adopted by the Department. If the Department subsequently determines that all or any part of the credit taken was not actually due to the distributor, the distributor's discount shall be reduced by an amount equal to the difference between the discount as applied to the credit taken and that actually due, and that distributor shall be liable for penalties and interest on such difference.

(Source: P.A. 100-9, eff. 7-1-17; 100-1171, eff. 1-4-19.)

(35 ILCS 505/6) (from Ch. 120, par. 422)

Sec. 6. Collection of tax; distributors. A distributor who sells or distributes any motor fuel, which he is required by Section 5 to report to the Department when filing a return, shall (except as hereinafter provided) collect at the time of such sale and distribution, the amount of tax imposed under this Act on all such motor fuel sold and distributed, and at the time of making a return, the distributor shall pay to the Department the amount so collected less a discount of 2% through June 30, 2003 and 1.75% thereafter which is allowed to reimburse the distributor for the expenses incurred in keeping records, preparing and filing returns, collecting and remitting the tax and supplying data to the Department on request, and shall also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all such motor fuel used by said distributor during the period covered by the return. However, no payment shall be made based upon dyed diesel fuel used by the distributor for non-highway purposes. The discount shall only be applicable to the amount of tax payment which accompanies a return which is filed timely in accordance with Section 5 of this Act. In each subsequent sale of motor fuel on which the amount of tax imposed under this Act has been collected as provided in this Section, the amount so collected shall be added to the selling price, so that the amount of tax is paid ultimately by the user of the motor fuel. However, no collection or payment shall be made in the case of the sale or use of any motor fuel to the extent to which such sale or use of motor fuel may not, under the constitution and statutes of the United States, be made the subject of taxation by this State. A person whose license to act as a distributor of fuel has been revoked shall, at the time of making a return, also pay to the Department an amount equal to the amount that would be collectible as a tax in the event of a sale thereof on all motor fuel, which he is required by the second paragraph of Section 5 to report to the Department in making a return, and which he had on hand on the date on which the license was revoked, and with respect to which no tax had been previously paid under this Act.

A distributor may make tax free sales of motor fuel, with respect to which he is otherwise required to collect the tax, only as specified in the following items 1 through 7.

1. When the sale is made to a person holding a valid unrevoked license as a distributor, by making a specific notation thereof on invoices or sales slip covering each sale.

2. When the sale is made with delivery to a purchaser outside of this State.

3. When the sale is made to the Federal Government or its instrumentalities.

4. When the sale is made to a municipal corporation owning and operating a local transportation system for public service in this State when an official certificate of exemption is obtained in lieu of the tax.

5. When the sale is made to a privately owned public utility owning and operating 2 axle vehicles designed and used for transporting more than 7 passengers, which vehicles are used as common carriers in general transportation of passengers, are not devoted to any specialized purpose and are operated entirely within the territorial limits of a single municipality or of any group of contiguous municipalities, or in a close radius thereof, and the operations of which are subject to the regulations of the Illinois Commerce Commission, when an official certificate of exemption is obtained in lieu of the tax.

6. (Blank). When a sale of special fuel is made to a person holding a valid, unrevoked license as a supplier, by making a specific notation thereof on the invoice or sales slip covering each such sale.

7. When a sale of dyed diesel fuel is made by the licensed distributor to the end user of the fuel who is not a licensed distributor or a licensed supplier for non-highway purposes and the fuel is (i) delivered from a vehicle designed for the specific purpose of such sales and delivered directly into a stationary bulk storage tank that displays the notice required by Section 4f of this Act, (ii) delivered from a vehicle designed for the specific purpose of such sales and delivered directly into the fuel supply tanks of non-highway vehicles that are not required to be registered for highway use, or (iii) dispensed from a dyed diesel fuel dispensing facility that has withdrawal facilities that are not readily accessible to and are not capable of dispensing dyed diesel fuel into the fuel supply tank of a motor vehicle.

A specific notation is required on the invoice or sales slip covering such sales, and any supporting documentation that may be required by the Department must be obtained by the distributor. The distributor shall obtain and keep the supporting documentation in such form as the Department may require by rule.

For purposes of this item 7, a dyed diesel fuel dispensing facility is considered to have withdrawal facilities that are "not readily accessible to and not capable of dispensing dyed diesel fuel into the fuel supply tank of a motor vehicle" only if the dyed diesel fuel is delivered from: (i) a dispenser hose that is short enough so that it will not reach the fuel supply tank of a motor vehicle or (ii) a dispenser that is enclosed by a fence or other physical barrier so that a vehicle cannot pull alongside the dispenser to permit fueling.

8. (Blank).

All special fuel sold or used for non-highway purposes must have a dye added in accordance with Section 4d of this Law.

All suits or other proceedings brought for the purpose of recovering any taxes, interest or penalties due the State of Illinois under this Act may be maintained in the name of the Department.

(Source: P.A. 102-1019, eff. 5-27-22.)

(35 ILCS 505/7) (from Ch. 120, par. 423)

Sec. 7. Any person who is , not licensed as a receiver or , distributor and who purchases or supplier, purchasing fuel or motor fuel as to which there has been no charge made to him of the tax imposed by Section 2 or 2a, or both, shall make payment of the tax imposed by Section 2a of this Act and if the same be thereafter used in the operation of a motor vehicle upon the public highways, make payment of the motor fuel tax computed at the rate prescribed in Section 2 of this Act on the amount so used, such payment to be made to the Department not later than the 20th day of the month succeeding the month in which the motor fuel was so used.

This Section does not apply in cases of such use of motor fuel which was obtained tax-free under an official certificate of exemption mentioned in Sections 6 and 6a of this Act.

(Source: P.A. 86-125.)

(35 ILCS 505/11.5) (from Ch. 120, par. 427a)

Sec. 11.5. In the event that liability upon the bond filed by a distributor, supplier, or receiver with the Department shall be discharged or reduced, whether by judgment rendered, payment made or otherwise, or if in the opinion of the Department the bond of any distributor, supplier, or receiver theretofore given shall become unsatisfactory, then the distributor, supplier, or receiver shall forthwith, upon the written demand of the Department, file a new bond in the same manner and form and in an amount and with sureties satisfactory to the Department, failing which the Department shall forthwith revoke the license of the distributor, supplier, or receiver.

If such new bond shall be furnished by the distributor, supplier, or receiver as above provided, the Department shall cancel the bond for which such new bond shall be substituted.

Any surety on any bond furnished by any distributor, supplier, or receiver shall be released and discharged from any and all liability to the State of Illinois accruing on such bond after the expiration of 60 days from the date upon which such surety shall have filed with the Department written request so to be released and discharged. But such request shall not operate to relieve, release or discharge such surety from any liability already accrued, or which shall accrue, before the expiration of said 60-day period. The Department shall, promptly on receipt of such request, notify the distributor, supplier, or receiver and, unless such distributor, supplier, or receiver shall on or before the expiration of such 60-day period file with the Department a new bond with a surety or sureties satisfactory to the Department in the amount and form hereinbefore provided, the Department shall forthwith cancel the license of such distributor, supplier, or receiver. If such new bond shall be furnished by said distributor, supplier, or receiver as above provided, the Department shall cancel the bond for which such new bond shall be substituted.

(Source: P.A. 91-173, eff. 1-1-00.)

(35 ILCS 505/12) (from Ch. 120, par. 428)

Sec. 12. It is the duty of every distributor and , receiver, and supplier under this Act to keep within this State or at some office outside this State for any period for which the Department is authorized to issue a Notice of Tax Liability to the distributor or , receiver, or supplier records and books showing all purchases, receipts, losses through any cause, sales, distribution and use of motor fuel, aviation fuels, home heating oils, and kerosene, and products used for the purpose of blending to produce motor fuel, which records and books shall, at all times during business hours of the day, be subject to inspection by the Department, or its duly authorized agents and employees. For purposes of this Section, "records" means all data maintained by the taxpayer including data on paper, microfilm, microfiche or any type of machine-sensible data compilation. The Department may, in its discretion, prescribe reasonable and uniform methods for keeping of records and books by licensees and that set forth requirements for the form and format of records that must be maintained in order to comply with any recordkeeping requirement under this Act.

(Source: P.A. 91-173, eff. 1-1-00.)

(35 ILCS 505/12a) (from Ch. 120, par. 428a)

Sec. 12a. (a) Any duly authorized agent or employee of the Department shall have authority to enter in or upon the premises of any manufacturer, vendor, dealer, retailer, distributor, receiver, supplier or user of motor fuel or special fuels during the regular business hours in order to examine books, records, invoices, storage tanks, and any other applicable equipment pertaining to motor fuel, aviation fuels, home heating oils, kerosene, or special fuels, to determine whether or not the taxes imposed by this Act have been paid.

(b) Any duly authorized agent of the Department, upon presenting appropriate credentials and a written notice to the person who owns, operates, or controls the place to be inspected, shall have the authority to enter any place and to conduct inspections in accordance with subsections (b) through (g) of this Section.

(c) Inspections will be performed in a reasonable manner and at times that are reasonable under the circumstances, taking into consideration the normal business hours of the place to be entered.

(d) Inspections may be at any place at which taxable motor fuel is or may be produced or stored or at any inspection site where evidence of the following activities may be discovered:

(1) Where any dyed diesel fuel is sold or held for sale by any person for any use which the person knows or has reason to know is not a nontaxable use of such fuel.

(2) Where any dyed diesel fuel is held for use or used by any person for a use other than a nontaxable use and the person knew, or had reason to know, that the fuel was dyed according to Section 4d.

(3) Where any person willfully alters, or attempts to alter, the strength or composition of any dye or marking done pursuant to Section 4d of this Law.

The places may include, but are not limited to, the following:

(1) Any terminal.

(2) Any fuel storage facility that is not a terminal.

(3) Any retail fuel facility.

(4) Any designated inspection site.

(e) Duly authorized agents of the Department may physically inspect, examine, or otherwise search any tank, reservoir, or other container that can or may be used for the production, storage, or transportation of fuel, fuel dyes, or fuel markers. Inspection may also be made of any equipment used for, or in connection with, production, storage, or transportation of fuel, fuel dyes, or fuel markers. This includes any equipment used for the dyeing or marking of fuel. This also includes books and records, if any, that are maintained at the place of inspection and are kept to determine tax liability under this Law.

(f) Duly authorized agents of the Department may detain any motor vehicle, train, barge, ship, or vessel for the purpose of inspecting its fuel tanks and storage tanks. Detainment will be either on the premises under inspection or at a designated inspection site. Detainment may continue for a reasonable period of time as is necessary to determine the amount and composition of the fuel.

(g) Duly authorized agents of the Department may take and remove samples of fuel in quantities as are reasonably necessary to determine the composition of the fuel.

(h) (1) Any person that refuses to allow an inspection shall pay a $1,000 penalty for each refusal. This penalty is in addition to any other penalty or tax that may be imposed upon that person or any other person liable for tax under this Law. All penalties received under this subsection shall be deposited into the Tax Compliance and Administration Fund.

(2) In addition, any licensee who refuses to allow an inspection shall be subject to license revocation as provided by Section 16 of this Law.

(Source: P.A. 91-173, eff. 1-1-00.)

(35 ILCS 505/13) (from Ch. 120, par. 429)

Sec. 13. Refund of tax paid. Any person other than a distributor or supplier, who loses motor fuel through any cause or uses motor fuel (upon which he has paid the amount required to be collected under Section 2 of this Act) for any purpose other than operating a motor vehicle upon the public highways or waters, shall be reimbursed and repaid the amount so paid.

Any person who purchases motor fuel in Illinois and uses that motor fuel in another state and that other state imposes a tax on the use of such motor fuel shall be reimbursed and repaid the amount of Illinois tax paid under Section 2 of this Act on the motor fuel used in such other state. Reimbursement and repayment shall be made by the Department upon receipt of adequate proof of taxes directly paid to another state and the amount of motor fuel used in that state.

Claims based in whole or in part on taxes paid to another state shall include (i) a certified copy of the tax return filed with such other state by the claimant; (ii) a copy of either the cancelled check paying the tax due on such return, or a receipt acknowledging payment of the tax due on such tax return; and (iii) such other information as the Department may reasonably require. This paragraph shall not apply to taxes paid on returns filed under Section 13a.3 of this Act.

Any person who purchases motor fuel use tax decals as required by Section 13a.4 and pays an amount of fees for such decals that exceeds the amount due shall be reimbursed and repaid the amount of the decal fees that are deemed by the department to be in excess of the amount due. Alternatively, any person who purchases motor fuel use tax decals as required by Section 13a.4 may credit any excess decal payment verified by the Department against amounts subsequently due for the purchase of additional decals, until such time as no excess payment remains.

Claims for such reimbursement must be made to the Department of Revenue, duly verified by the claimant (or by the claimant's legal representative if the claimant has died or become a person under legal disability), upon forms prescribed by the Department. The claim must state such facts relating to the purchase, importation, manufacture or production of the motor fuel by the claimant as the Department may deem necessary, and the time when, and the circumstances of its loss or the specific purpose for which it was used (as the case may be), together with such other information as the Department may reasonably require. No claim based upon idle time shall be allowed. Claims for reimbursement for overpayment of decal fees shall be made to the Department of Revenue, duly verified by the claimant (or by the claimant's legal representative if the claimant has died or become a person under legal disability), upon forms prescribed by the Department. The claim shall state facts relating to the overpayment of decal fees, together with such other information as the Department may reasonably require. Claims for reimbursement of overpayment of decal fees paid on or after January 1, 2011 must be filed not later than one year after the date on which the fees were paid by the claimant. If it is determined that the Department should reimburse a claimant for overpayment of decal fees, the Department shall first apply the amount of such refund against any tax or penalty or interest due by the claimant under Section 13a of this Act.

Claims for full reimbursement for taxes paid on or before December 31, 1999 must be filed not later than one year after the date on which the tax was paid by the claimant. If, however, a claim for such reimbursement otherwise meeting the requirements of this Section is filed more than one year but less than 2 years after that date, the claimant shall be reimbursed at the rate of 80% of the amount to which he would have been entitled if his claim had been timely filed.

Claims for full reimbursement for taxes paid on or after January 1, 2000 must be filed not later than 2 years after the date on which the tax was paid by the claimant.

The Department may make such investigation of the correctness of the facts stated in such claims as it deems necessary. When the Department has approved any such claim, it shall pay to the claimant (or to the claimant's legal representative, as such if the claimant has died or become a person under legal disability) the reimbursement provided in this Section, out of any moneys appropriated to it for that purpose.

Any distributor or supplier who has paid the tax imposed by Section 2 of this Act upon motor fuel lost or used by such distributor or supplier for any purpose other than operating a motor vehicle upon the public highways or waters may file a claim for credit or refund to recover the amount so paid. Such claims shall be filed on forms prescribed by the Department. Such claims shall be made to the Department, duly verified by the claimant (or by the claimant's legal representative if the claimant has died or become a person under legal disability), upon forms prescribed by the Department. The claim shall state such facts relating to the purchase, importation, manufacture or production of the motor fuel by the claimant as the Department may deem necessary and the time when the loss or nontaxable use occurred, and the circumstances of its loss or the specific purpose for which it was used (as the case may be), together with such other information as the Department may reasonably require. Claims must be filed not later than one year after the date on which the tax was paid by the claimant.

The Department may make such investigation of the correctness of the facts stated in such claims as it deems necessary. When the Department approves a claim, the Department shall issue a refund or credit memorandum as requested by the taxpayer, to the distributor or supplier who made the payment for which the refund or credit is being given or, if the distributor or supplier has died or become incompetent, to such distributor's or supplier's legal representative, as such. The amount of such credit memorandum shall be credited against any tax due or to become due under this Act from the distributor or supplier who made the payment for which credit has been given.

Any credit or refund that is allowed under this Section shall bear interest at the rate and in the manner specified in the Uniform Penalty and Interest Act.

In case the distributor or supplier requests and the Department determines that the claimant is entitled to a refund, such refund shall be made only from such appropriation as may be available for that purpose. If it appears unlikely that the amount appropriated would permit everyone having a claim allowed during the period covered by such appropriation to elect to receive a cash refund, the Department, by rule or regulation, shall provide for the payment of refunds in hardship cases and shall define what types of cases qualify as hardship cases.

In any case in which there has been an erroneous refund of tax or fees payable under this Section, a notice of tax liability may be issued at any time within 3 years from the making of that refund, or within 5 years from the making of that refund if it appears that any part of the refund was induced by fraud or the misrepresentation of material fact. The amount of any proposed assessment set forth by the Department shall be limited to the amount of the erroneous refund.

If no tax is due and no proceeding is pending to determine whether such distributor or supplier is indebted to the Department for tax, the credit memorandum so issued may be assigned and set over by the lawful holder thereof, subject to reasonable rules of the Department, to any other licensed distributor or supplier who is subject to this Act, and the amount thereof applied by the Department against any tax due or to become due under this Act from such assignee.

If the payment for which the distributor's or supplier's claim is filed is held in the protest fund of the State Treasury during the pendency of the claim for credit proceedings pursuant to the order of the court in accordance with Section 2a of the State Officers and Employees Money Disposition Act and if it is determined by the Department or by the final order of a reviewing court under the Administrative Review Law that the claimant is entitled to all or a part of the credit claimed, the claimant, instead of receiving a credit memorandum from the Department, shall receive a cash refund from the protest fund as provided for in Section 2a of the State Officers and Employees Money Disposition Act.

If any person ceases to be licensed as a distributor or supplier while still holding an unused credit memorandum issued under this Act, such person may, at his election (instead of assigning the credit memorandum to a licensed distributor or licensed supplier under this Act), surrender such unused credit memorandum to the Department and receive a refund of the amount to which such person is entitled.

For claims based upon taxes paid on or before December 31, 2000, a claim based upon the use of undyed diesel fuel shall not be allowed except (i) if allowed under the following paragraph or (ii) for undyed diesel fuel used by a commercial vehicle, as that term is defined in Section 1-111.8 of the Illinois Vehicle Code, for any purpose other than operating the commercial vehicle upon the public highways and unlicensed commercial vehicles operating on private property. Claims shall be limited to commercial vehicles that are operated for both highway purposes and any purposes other than operating such vehicles upon the public highways.

For claims based upon taxes paid on or after January 1, 2000, a claim based upon the use of undyed diesel fuel shall not be allowed except (i) if allowed under the preceding paragraph or (ii) for claims for the following:

(1) Undyed diesel fuel used (i) in a manufacturing process, as defined in Section 2-45 of the Retailers' Occupation Tax Act, wherein the undyed diesel fuel becomes a component part of a product or by-product, other than fuel or motor fuel, when the use of dyed diesel fuel in that manufacturing process results in a product that is unsuitable for its intended use or (ii) for testing machinery and equipment in a manufacturing process, as defined in Section 2-45 of the Retailers' Occupation Tax Act, wherein the testing takes place on private property.

(2) Undyed diesel fuel used by a manufacturer on private property in the research and development, as defined in Section 1.29, of machinery or equipment intended for manufacture.

(3) Undyed diesel fuel used by a single unit self-propelled agricultural fertilizer implement, designed for on and off road use, equipped with flotation tires and specially adapted for the application of plant food materials or agricultural chemicals.

(4) Undyed diesel fuel used by a commercial motor vehicle for any purpose other than operating the commercial motor vehicle upon the public highways. Claims shall be limited to commercial motor vehicles that are operated for both highway purposes and any purposes other than operating such vehicles upon the public highways.

(5) Undyed diesel fuel used by a unit of local government in its operation of an airport if the undyed diesel fuel is used directly in airport operations on airport property.

(6) Undyed diesel fuel used by refrigeration units that are permanently mounted to a semitrailer, as defined in Section 1.28 of this Law, wherein the refrigeration units have a fuel supply system dedicated solely for the operation of the refrigeration units.

(7) Undyed diesel fuel used by power take-off equipment as defined in Section 1.27 of this Law.

(8) Beginning on the effective date of this amendatory Act of the 94th General Assembly, undyed diesel fuel used by tugs and spotter equipment to shift vehicles or parcels on both private and airport property. Any claim under this item (8) may be made only by a claimant that owns tugs and spotter equipment and operates that equipment on both private and airport property. The aggregate of all credits or refunds resulting from claims filed under this item (8) by a claimant in any calendar year may not exceed $100,000. A claim may not be made under this item (8) by the same claimant more often than once each quarter. For the purposes of this item (8), "tug" means a vehicle designed for use on airport property that shifts custom-designed containers of parcels from loading docks to aircraft, and "spotter equipment" means a vehicle designed for use on both private and airport property that shifts trailers containing parcels between staging areas and loading docks.

Any person who has paid the tax imposed by Section 2 of this Law upon undyed diesel fuel that is unintentionally mixed with dyed diesel fuel and who owns or controls the mixture of undyed diesel fuel and dyed diesel fuel may file a claim for refund to recover the amount paid. The amount of undyed diesel fuel unintentionally mixed must equal 500 gallons or more. Any claim for refund of unintentionally mixed undyed diesel fuel and dyed diesel fuel shall be supported by documentation showing the date and location of the unintentional mixing, the number of gallons involved, the disposition of the mixed diesel fuel, and any other information that the Department may reasonably require. Any unintentional mixture of undyed diesel fuel and dyed diesel fuel shall be sold or used only for non-highway purposes.

The Department shall promulgate regulations establishing specific limits on the amount of undyed diesel fuel that may be claimed for refund.

For purposes of claims for refund, "loss" means the reduction of motor fuel resulting from fire, theft, spillage, spoilage, leakage, or any other provable cause, but does not include a reduction resulting from evaporation, or shrinkage due to temperature variations. In the case of losses due to fire or theft, the claimant must include fire department or police department reports and any other documentation that the Department may require.

(Source: P.A. 100-1171, eff. 1-4-19.)

(35 ILCS 505/14a) (from Ch. 120, par. 430.1)

Sec. 14a. The Department of Revenue may enter into reciprocal agreements with the appropriate officials of any other state under which the Department may waive all or any part of the requirements imposed by the laws of this State upon those who use or consume motor fuel in Illinois upon which a tax has been paid to such other state, provided that the officials of such other state grant equivalent privileges with respect to motor fuel used in such other state but upon which the tax has been paid to Illinois.

The Department may enter the International Fuel Tax Agreement or other cooperative compacts or agreements with other states or jurisdictions to permit base state or base jurisdiction licensing of persons using motor fuel in this State. Those agreements may provide for the cooperation and assistance among member states in the administration and collection of motor fuel tax, including, but not limited to, exchanges of information, auditing and assessing of interstate carriers and suppliers, and any other activities necessary to further uniformity.

Pursuant to federal mandate, upon membership in the International Fuel Tax Agreement ("Agreement"), the motor fuel use tax imposed upon Commercial Motor Vehicles required to be registered under the terms of the Agreement shall be administered according to the terms of the Agreement, as now and hereafter amended. Illinois shall not establish, maintain, or enforce any law or regulation that has fuel use tax reporting requirements or that provides for the payment of a fuel use tax, unless that law or regulation is in conformity with the Agreement.

The Department shall adopt rules and regulations to implement the provisions of the Agreement.

(Source: P.A. 88-480.)

(35 ILCS 505/15) (from Ch. 120, par. 431)

Sec. 15. 1. Any person who knowingly acts as a distributor of motor fuel or supplier of special fuel, or receiver of fuel without having a license so to do, or who knowingly fails or refuses to file a return with the Department as provided in Section 2b, Section 5, or Section 5a of this Act, or who knowingly fails or refuses to make payment to the Department as provided either in Section 2b, Section 6, Section 6a, or Section 7 of this Act, shall be guilty of a Class 3 felony. Each day any person knowingly acts as a distributor of motor fuel, supplier of special fuel, or receiver of fuel without having a license so to do or after such a license has been revoked, constitutes a separate offense.

2. Any person who acts as a motor carrier without having a valid motor fuel use tax license, issued by the Department or by a member jurisdiction under the provisions of the International Fuel Tax Agreement, or a valid single trip permit is guilty of a Class A misdemeanor for a first offense and is guilty of a Class 4 felony for each subsequent offense. Any person (i) who fails or refuses to make payment to the Department as provided in Section 13a.1 of this Act or in the International Fuel Tax Agreement referenced in Section 14a, or (ii) who fails or refuses to make the quarterly return as provided in Section 13a.3 is guilty of a Class 4 felony; and for each subsequent offense, such person is guilty of a Class 3 felony.

3. In case such person acting as a distributor, receiver, supplier, or motor carrier is a corporation, then the officer or officers, agent or agents, employee or employees, of such corporation responsible for any act of such corporation, or failure of such corporation to act, which acts or failure to act constitutes a violation of any of the provisions of this Act as enumerated in paragraphs 1 and 2 of this Section, shall be punished by such fine or imprisonment, or by both such fine and imprisonment as provided in those paragraphs.

3.5. Any person who knowingly enters false information on any supporting documentation required to be kept by Section 6 or 6a of this Act is guilty of a Class 3 felony.

3.7. Any person who knowingly attempts in any manner to evade or defeat any tax imposed by this Act or the payment of any tax imposed by this Act is guilty of a Class 2 felony.

4. Any person who refuses, upon demand, to submit for inspection, books and records, or who fails or refuses to keep books and records in violation of Section 12 of this Act, or any distributor or , receiver, or supplier who violates any reasonable rule or regulation adopted by the Department for the enforcement of this Act is guilty of a Class A misdemeanor. Any person who acts as a blender in violation of Section 3 of this Act is guilty of a Class 4 felony.

5. Any person licensed under Section 13a.4, 13a.5, or the International Fuel Tax Agreement who: (a) fails or refuses to keep records and books, as provided in Section 13a.2 or as required by the terms of the International Fuel Tax Agreement, (b) refuses upon demand by the Department to submit for inspection and examination the records required by Section 13a.2 of this Act or by the terms of the International Fuel Tax Agreement, or (c) violates any reasonable rule or regulation adopted by the Department for the enforcement of this Act, is guilty of a Class A misdemeanor.

6. Any person who makes any false return or report to the Department as to any material fact required by Sections 2b, 5, 5a, 7, 13, or 13a.3 of this Act or by the International Fuel Tax Agreement is guilty of a Class 2 felony.

7. A prosecution for any violation of this Section may be commenced anytime within 5 years of the commission of that violation. A prosecution for tax evasion as set forth in paragraph 3.7 of this Section may be prosecuted any time within 5 years of the commission of the last act in furtherance of evasion. The running of the period of limitations under this Section shall be suspended while any proceeding or appeal from any proceeding relating to the quashing or enforcement of any grand jury or administrative subpoena issued in connection with an investigation of the violation of any provision of this Act is pending.

8. Any person who provides false documentation required by any Section of this Act is guilty of a Class 4 felony.

9. Any person filing a fraudulent application or order form under any provision of this Act is guilty of a Class A misdemeanor. For each subsequent offense, the person is guilty of a Class 4 felony.

10. Any person who acts as a motor carrier and who fails to carry a manifest as provided in Section 5.5 is guilty of a Class A misdemeanor. For each subsequent offense, the person is guilty of a Class 4 felony.

11. Any person who knowingly sells or attempts to sell dyed diesel fuel for highway use or for use by recreational-type watercraft on the waters of this State is guilty of a Class 4 felony. For each subsequent offense, the person is guilty of a Class 2 felony.

12. Any person who knowingly possesses dyed diesel fuel for highway use or for use by recreational-type watercraft on the waters of this State is guilty of a Class A misdemeanor. For each subsequent offense, the person is guilty of a Class 4 felony.

13. Any person who sells or transports dyed diesel fuel without the notice required by Section 4e shall pay the following penalty:

First occurrence....................................$ 500

Second and each occurrence thereafter..............$1,000

14. Any person who owns, operates, or controls any container, storage tank, or facility used to store or distribute dyed diesel fuel without the notice required by Section 4f shall pay the following penalty:

First occurrence....................................$ 500

Second and each occurrence thereafter..............$1,000

15. If a motor vehicle required to be registered for highway purposes is found to have dyed diesel fuel within the ordinary fuel tanks attached to the motor vehicle or if a recreational-type watercraft on the waters of this State is found to have dyed diesel fuel within the ordinary fuel tanks attached to the watercraft, the operator shall pay the following penalty:

First occurrence...................................$1,000

Second and each occurrence thereafter..............$5,000

16. Any licensed motor fuel distributor or licensed supplier who sells or attempts to sell dyed diesel fuel for highway use or for use by recreational-type watercraft on the waters of this State shall pay the following penalty:

First occurrence...................................$1,000

Second and each occurrence thereafter..............$5,000

17. Any person who knowingly sells or distributes dyed diesel fuel without the notice required by Section 4e is guilty of a petty offense. For each subsequent offense, the person is guilty of a Class A misdemeanor.

18. Any person who knowingly owns, operates, or controls any container, storage tank, or facility used to store or distribute dyed diesel fuel without the notice required by Section 4f is guilty of a petty offense. For each subsequent offense the person is guilty of a Class A misdemeanor.

For purposes of this Section, dyed diesel fuel means any dyed diesel fuel whether or not dyed pursuant to Section 4d of this Law.

Any person aggrieved by any action of the Department under item 13, 14, 15, or 16 of this Section may protest the action by making a written request for a hearing within 60 days of the original action. If the hearing is not requested in writing within 60 days, the original action is final.

All penalties received under items 13, 14, 15, and 16 of this Section shall be deposited into the Tax Compliance and Administration Fund.

(Source: P.A. 102-851, eff. 1-1-23.)

(35 ILCS 505/16) (from Ch. 120, par. 432)

Sec. 16. The Department may, after 5 days' notice, revoke the distributor's or , receiver's, or supplier's license or permit of any person (1) who does not operate as a distributor or , receiver, supplier (a) under Sections 1.2, 1.14, or 1.20, (2) who violates any provision of this Act or any rule or regulation promulgated by the Department under Section 14 of this Act, or (3) who refuses to allow any inspection or test authorized by this Law.

Any person whose returns for 2 or more consecutive months do not show sufficient taxable sales to indicate an active business as a distributor or , receiver, or supplier shall be deemed to not be operating as a distributor or , receiver, or supplier as defined in Sections 1.2, 1.14 or 1.20.

The Department may, after 5 days notice, revoke any distributor's or , receiver's, or supplier's license of a person who is registered as a reseller of motor fuel pursuant to Section 2a or 2c of the Retailers' Occupation Tax Act and who fails to collect such prepaid tax on invoiced gallons of motor fuel sold or who fails to deliver a statement of tax paid to the purchaser or to the Department as required by Sections 2d and 2e of the Retailers' Occupation Tax Act.

The Department may, on notice given by registered mail, cancel a Blender's Permit for any violation of any provisions of this Act or for noncompliance with any rule or regulation made by the Department under Section 14 of this Act.

The Department, upon complaint filed in the circuit court, may, by injunction, restrain any person who fails or refuses to comply with the provisions of this Act from acting as a blender or distributor of motor fuel, supplier of special fuel, or as a receiver of fuel in this State.

The Department may revoke the motor fuel use tax license of a motor carrier registered under Section 13a.4, or that is required to be registered under the terms of the International Fuel Tax Agreement, that violates any provision of this Act or any rule promulgated by the Department under Sections 14 or 14a of this Act. Motor fuel use tax licenses that have been revoked are subject to a $100 reinstatement fee.

Licensees registered or required to be registered under Section 13a.4, or persons required to obtain single trip permits under Section 13a.5, may protest any action or audit finding made by the Department by making a written request for a hearing within 30 days after service of the notice of the original action or finding. If the hearing is not requested within 30 days in writing, the original finding or action is final. Once a hearing has been properly requested, the Department shall give at least 20 days written notice of the time and place of the hearing.

(Source: P.A. 94-1074, eff. 12-26-06.)

(35 ILCS 505/1.14 rep.)

(35 ILCS 505/3a rep.)

(35 ILCS 505/5a rep.)

(35 ILCS 505/6a rep.)

Section 10. The Motor Fuel Tax Law is amended by repealing Sections 1.14, 3a, 5a, and 6a.

Section 99. Effective date. This Act takes effect January 1, 2026.".