State of Illinois
92nd General Assembly
Legislation

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92_HB4329

 
                                               LRB9214955SMdv

 1        AN ACT in relation to taxes.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The Motor Fuel Tax Law is amended by changing
 5    Section 13 as follows:

 6        (35 ILCS 505/13) (from Ch. 120, par. 429)
 7        Sec. 13.  Refund of tax paid.  Any person  other  than  a
 8    distributor  or  supplier,  who  loses motor fuel through any
 9    cause or uses motor fuel (upon which he has paid  the  amount
10    required to be collected under Section 2 of this Act) for any
11    purpose  other than operating a motor vehicle upon the public
12    highways or waters, shall be reimbursed and repaid the amount
13    so paid.
14        Any person who purchases motor fuel in Illinois and  uses
15    that motor fuel in another state and that other state imposes
16    a  tax  on the use of such motor fuel shall be reimbursed and
17    repaid the amount of Illinois tax paid  under  Section  2  of
18    this  Act  on  the  motor  fuel  used  in  such  other state.
19    Reimbursement and repayment shall be made by  the  Department
20    upon receipt of adequate proof of taxes paid to another state
21    and the amount of motor fuel used in that state.
22        Claims  for  such  reimbursement  must  be  made  to  the
23    Department  of  Revenue, duly verified by the claimant (or by
24    the claimant's legal representative if the claimant has  died
25    or  become  a  person  under  legal  disability),  upon forms
26    prescribed by the Department.   The  claim  must  state  such
27    facts  relating  to the purchase, importation, manufacture or
28    production  of  the  motor  fuel  by  the  claimant  as   the
29    Department  may  deem  necessary,  and the time when, and the
30    circumstances of its loss or the specific purpose  for  which
31    it  was  used  (as the case may be), together with such other
 
                            -2-                LRB9214955SMdv
 1    information as the Department  may  reasonably  require.   No
 2    claim based upon idle time shall be allowed.
 3        Claims for full reimbursement for taxes paid on or before
 4    December 31, 1999 must be filed not later than one year after
 5    the  date  on  which  the  tax  was paid by the claimant. If,
 6    however, a claim for such reimbursement otherwise meeting the
 7    requirements of this Section is filed more than one year  but
 8    less  than  2  years  after  that date, the claimant shall be
 9    reimbursed at the rate of 80% of the amount to which he would
10    have been entitled if his claim had been timely filed.
11        Claims for full reimbursement for taxes paid on or  after
12    January  1,  2000  must be filed not later than 2 years after
13    the date on which the tax was paid by the claimant.
14        The  Department  may  make  such  investigation  of   the
15    correctness  of  the  facts stated in such claims as it deems
16    necessary.  When the Department has approved any such  claim,
17    it  shall  pay  to  the  claimant (or to the claimant's legal
18    representative, as such if the claimant has died or become  a
19    person  under legal disability) the reimbursement provided in
20    this Section, out of any moneys appropriated to it  for  that
21    purpose.
22        Any  distributor or supplier who has paid the tax imposed
23    by Section 2 of this Act upon motor fuel lost or used by such
24    distributor or supplier for any purpose other than  operating
25    a motor vehicle upon the public highways or waters may file a
26    claim  for  credit  or  refund to recover the amount so paid.
27    Such claims  shall  be  filed  on  forms  prescribed  by  the
28    Department.   Such  claims  shall  be made to the Department,
29    duly verified by the claimant (or  by  the  claimant's  legal
30    representative  if  the  claimant has died or become a person
31    under  legal  disability),  upon  forms  prescribed  by   the
32    Department.  The claim shall state such facts relating to the
33    purchase, importation, manufacture or production of the motor
34    fuel by the claimant as the Department may deem necessary and
 
                            -3-                LRB9214955SMdv
 1    the  time  when  the loss or nontaxable use occurred, and the
 2    circumstances of its loss or the specific purpose  for  which
 3    it  was  used  (as the case may be), together with such other
 4    information as the Department may reasonably require.  Claims
 5    must be filed not later than one year after the date on which
 6    the tax was paid by the claimant.
 7        The  Department  may  make  such  investigation  of   the
 8    correctness  of  the  facts stated in such claims as it deems
 9    necessary.   When  the  Department  approves  a  claim,   the
10    Department  shall  issue  a  refund  or  credit memorandum as
11    requested by the taxpayer, to the distributor or supplier who
12    made the payment for which the  refund  or  credit  is  being
13    given  or,  if the distributor or supplier has died or become
14    incompetent,  to  such  distributor's  or  supplier's   legal
15    representative,   as   such.    The  amount  of  such  credit
16    memorandum shall be credited against any tax due or to become
17    due under this Act from the distributor or supplier who  made
18    the payment for which credit has been given.
19        Any  credit  or refund that is allowed under this Section
20    shall bear interest at the rate and in the  manner  specified
21    in the Uniform Penalty and Interest Act.
22        In  case  the  distributor  or  supplier requests and the
23    Department determines that the  claimant  is  entitled  to  a
24    refund,   such   refund   shall   be   made  only  from  such
25    appropriation as may be available for  that  purpose.  If  it
26    appears  unlikely  that  the amount appropriated would permit
27    everyone having a claim allowed during the period covered  by
28    such  appropriation  to  elect  to receive a cash refund, the
29    Department, by rule or  regulation,  shall  provide  for  the
30    payment  of  refunds  in hardship cases and shall define what
31    types of cases qualify as hardship cases.
32        In any case in which there has been an  erroneous  refund
33    of  tax payable under this Section, a notice of tax liability
34    may be issued at any time within 3 years from the  making  of
 
                            -4-                LRB9214955SMdv
 1    that refund, or within 5 years from the making of that refund
 2    if  it  appears  that  any  part of the refund was induced by
 3    fraud or the misrepresentation of material fact.  The  amount
 4    of  any proposed assessment set forth by the Department shall
 5    be limited to the amount of the erroneous refund.
 6        If no  tax  is  due  and  no  proceeding  is  pending  to
 7    determine whether such distributor or supplier is indebted to
 8    the  Department  for tax, the credit memorandum so issued may
 9    be assigned and  set  over  by  the  lawful  holder  thereof,
10    subject  to  reasonable rules of the Department, to any other
11    licensed distributor or supplier who is subject to this  Act,
12    and  the amount thereof applied by the Department against any
13    tax due or to become due under this Act from such assignee.
14        If the payment for which the distributor's or  supplier's
15    claim  is  filed  is  held  in  the protest fund of the State
16    Treasury  during  the  pendency  of  the  claim  for   credit
17    proceedings  pursuant to the order of the court in accordance
18    with Section 2a of the State  Officers  and  Employees  Money
19    Disposition  Act and if it is determined by the Department or
20    by  the  final  order  of  a  reviewing   court   under   the
21    Administrative  Review  Law  that the claimant is entitled to
22    all or a part of the credit claimed, the claimant, instead of
23    receiving a credit  memorandum  from  the  Department,  shall
24    receive  a  cash refund from the protest fund as provided for
25    in Section 2a of  the  State  Officers  and  Employees  Money
26    Disposition Act.
27        If  any  person ceases to be licensed as a distributor or
28    supplier while still  holding  an  unused  credit  memorandum
29    issued  under  this  Act,  such  person may, at his  election
30    (instead of assigning the credit  memorandum  to  a  licensed
31    distributor  or  licensed supplier under this Act), surrender
32    such unused credit memorandum to the Department and receive a
33    refund of the amount to which such person is entitled.
34        For claims based upon taxes paid on  or  before  December
 
                            -5-                LRB9214955SMdv
 1    31,  2000,  a  claim based upon the use of undyed diesel fuel
 2    shall  not  be  allowed  except  (i)  if  allowed  under  the
 3    following paragraph or (ii) for undyed diesel fuel used by  a
 4    commercial  vehicle,  as  that  term  is  defined  in Section
 5    1-111.8 of the Illinois Vehicle Code, for any  purpose  other
 6    than   operating  the  commercial  vehicle  upon  the  public
 7    highways and  unlicensed  commercial  vehicles  operating  on
 8    private  property.   Claims  shall  be  limited to commercial
 9    vehicles that are operated for both highway purposes and  any
10    purposes  other  than operating such vehicles upon the public
11    highways.
12        For claims based upon taxes paid on or after  January  1,
13    2000,  a claim based upon the use of undyed diesel fuel shall
14    not be allowed except (i)  if  allowed  under  the  preceding
15    paragraph or (ii) for claims for the following:
16             (1)  Undyed  diesel fuel used (i) in a manufacturing
17        process, as defined in Section  2-45  of  the  Retailers'
18        Occupation  Tax  Act,  wherein  the  undyed  diesel  fuel
19        becomes  a  component  part  of  a product or by-product,
20        other than fuel or motor  fuel,  when  the  use  of  dyed
21        diesel  fuel  in  that manufacturing process results in a
22        product that is unsuitable for its intended use  or  (ii)
23        for  testing  machinery  and equipment in a manufacturing
24        process, as defined in Section  2-45  of  the  Retailers'
25        Occupation  Tax  Act,  wherein the testing takes place on
26        private property.
27             (2)  Undyed diesel fuel used by  a  manufacturer  on
28        private  property  in  the  research  and development, as
29        defined  in  Section  1.29,  of  machinery  or  equipment
30        intended for manufacture.
31             (3)  Undyed  diesel  fuel  used  by  a  single  unit
32        self-propelled   agricultural    fertilizer    implement,
33        designed for on and off road use, equipped with flotation
34        tires  and specially adapted for the application of plant
 
                            -6-                LRB9214955SMdv
 1        food materials or agricultural chemicals.
 2             (4)  Undyed diesel fuel used by a  commercial  motor
 3        vehicle   for   any  purpose  other  than  operating  the
 4        commercial motor vehicle upon the public highways. Claims
 5        shall be limited to commercial motor  vehicles  that  are
 6        operated for both highway purposes and any purposes other
 7        than operating such vehicles upon the public highways.
 8             (5)  Undyed  diesel  fuel  used  by  a unit of local
 9        government in its operation of an airport if  the  undyed
10        diesel  fuel  is  used  directly in airport operations on
11        airport property.
12             (6)  Undyed diesel fuel used by refrigeration  units
13        that are permanently mounted to a semitrailer, as defined
14        in  Section  1.28  of this Law, wherein the refrigeration
15        units have a fuel supply system dedicated solely for  the
16        operation of the refrigeration units.
17             (7)  Undyed  diesel  fuel  used  by  power  take-off
18        equipment as defined in Section 1.27 of this Law.
19             (8)  Undyed  diesel  fuel  used  by a small business
20        owner for landscape or construction equipment if  all  of
21        the following conditions are met:
22                  (A)  The landscape or construction equipment is
23             used off road.
24                  (B)  The  small business owner does not have an
25             on-site tank to hold dyed diesel fuel.
26                  (C)  The small business owner is located  in  a
27             metropolitan   statistical  area  in  Illinois.  For
28             purposes of this item (8), "metropolitan statistical
29             area" means a  geographical  area  designated  as  a
30             metropolitan  statistical area by the federal office
31             of management and budget and having such designation
32             on January 1, 2000.
33        Any person who has paid the tax imposed by Section  2  of
34    this  Law  upon  undyed  diesel  fuel that is unintentionally
 
                            -7-                LRB9214955SMdv
 1    mixed with dyed diesel fuel and  who  owns  or  controls  the
 2    mixture of undyed diesel fuel and dyed diesel fuel may file a
 3    claim  for  refund to recover the amount paid.  The amount of
 4    undyed diesel  fuel  unintentionally  mixed  must  equal  500
 5    gallons  or  more.   Any  claim for refund of unintentionally
 6    mixed undyed diesel  fuel  and  dyed  diesel  fuel  shall  be
 7    supported  by  documentation showing the date and location of
 8    the unintentional mixing, the number of gallons involved, the
 9    disposition  of  the  mixed  diesel  fuel,  and   any   other
10    information  that  the Department may reasonably require. Any
11    unintentional mixture of undyed diesel fuel and  dyed  diesel
12    fuel shall be sold or used only for non-highway purposes.
13        The  Department shall promulgate regulations establishing
14    specific limits on the amount of undyed diesel fuel that  may
15    be claimed for refund.
16        For  purposes  of  claims  for  refund,  "loss" means the
17    reduction of motor fuel resulting from fire, theft, spillage,
18    spoilage, leakage, or any other provable cause, but does  not
19    include  a  reduction resulting from evaporation or shrinkage
20    due to temperature variations.
21    (Source: P.A. 91-173, eff. 1-1-00; 92-30, eff. 7-1-01.)

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