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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.)