Dyed Fuel Tax Refund

IRC §6435

Allows a person who removes eligible indelibly dyed diesel fuel or kerosene from a terminal to receive a payment equal to the excise tax previously paid under section 4081.

Eligibility

Must establish that the fuel is indelibly dyed, tax was previously paid, and the fuel is exempt from taxation under section 4082(a).

Frequently Asked Questions

Who is eligible for the Dyed Fuel Tax Refund?

Must establish that the fuel is indelibly dyed, tax was previously paid, and the fuel is exempt from taxation under section 4082(a).

How does the Dyed Fuel Tax Refund work?

Allows a person who removes eligible indelibly dyed diesel fuel or kerosene from a terminal to receive a payment equal to the excise tax previously paid under section 4081.

What law authorizes the Dyed Fuel Tax Refund?

The Dyed Fuel Tax Refund is authorized under IRC §6435 of the Internal Revenue Code (Title 26, United States Code).

Statutory Text — IRC §6435

Source: Internal Revenue Code, Title 26, United States Code

§ 6435. Dyed fuel(a) In generalIf a person establishes to the satisfaction of the Secretary that such person meets the requirements of subsection (b) with respect to diesel fuel or kerosene, then the Secretary shall pay to such person an amount (without interest) equal to the tax described in subsection (b)(2)(A) with respect to such diesel fuel or kerosene. (b) Requirements(1) In generalA person meets the requirements of this subsection with respect to diesel fuel or kerosene if such person removes from a terminal eligible indelibly dyed diesel fuel or kerosene. (2) Eligible indelibly dyed diesel fuel or kerosene definedThe term “eligible indelibly dyed diesel fuel or kerosene” means diesel fuel or kerosene—(A) with respect to which a tax under section 4081 was previously paid (and not credited or refunded), and (B) which is exempt from taxation under section 4082(a). (c) Cross referenceFor civil penalty for excessive claims under this section, see section 6675. (Added Pub. L. 119–21, title VII, § 70525(a), July 4, 2025, 139 Stat. 282.) Statutory Notes and Related Subsidiaries Effective DateSection applicable to eligible indelibly dyed diesel fuel or kerosene removed on or after the date that is 180 days after July 4, 2025, see section 70525(c) of Pub. L. 119–21, set out as an Effective Date of 2025 Amendment note under section 6206 of this title.

Legal Sources

US Code (Official) — 26 USC §6435 → Cornell Law Institute — 26 USC §6435 → Search IRS.gov for IRC §6435 → Treasury Regulations (26 CFR) →

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