Laws, Regulations and Annotations

Search

Business Taxes Law Guide—Revision 2024

BTLG Table of Contents > Motor Vehicle Fuel Tax Law > Chapter 7 > entire chapter

Motor Vehicle Fuel Tax Law

Revenue and Taxation Code

Division 2. Other Taxes
Part 2. Motor Vehicle Fuel Tax Law

Chapter 7. Overpayments and Refunds.


Article 1. Refunds on Certain Sales

Article 2. Claim for Refund

Article 3. Suit for Refund

Article 4. Recovery of Erroneous Refunds

Article 5. Cancellations

Chapter 7. Overpayments and Refunds.

Article 1. Refunds on Certain Sales

8101. Refunds on certain sales. The following persons who have paid a tax for motor vehicle fuel, either directly or to the vendor from whom it was purchased, or indirectly by the adding of the amount of the tax to the price of the fuel, shall, except as otherwise provided in this part, be reimbursed and repaid the amount of the tax:

(a) Any person who buys and uses the motor vehicle fuel for purposes other than operating motor vehicles upon the public highways of the state, except vehicles subject to identification under Division 16.5 (commencing with Section 38000) of the Vehicle Code, which are used for recreational purposes or are rented or leased for recreational purposes, and, on and after July 1, 1974, except motor vehicles subject to registration under Division 3 (commencing with Section 4000) of the Vehicle Code while engaged in off-highway recreational use.

(b) Any person who exports the motor vehicle fuel for use outside of this state. Motor vehicle fuel carried from this state in the fuel tank of a motor vehicle or aircraft is not deemed to be exported from this state unless the motor vehicle fuel becomes subject to tax as an "import" under the laws of the destination state.

(c) Any person who sells the motor vehicle fuel to the Armed Forces of the United States for use in ships or aircraft or for use outside this state, under circumstances that would have entitled him or her to an exemption from the payment of the tax under Section 7401 had he or she been the supplier of this fuel.

(d) Any person who buys and uses the motor vehicle fuel in any construction equipment which is exempt from vehicle registration pursuant to the Vehicle Code, while operated within the confines and limits of a construction project.

(e) Any supplier who sells motor vehicle fuel which is sold to any consulate officer or consulate employee under circumstances which would have entitled the supplier to an exemption under paragraph (4) of subdivision (a) of Section 7401 if the supplier had sold the motor vehicle fuel directly to the consulate officer or consulate employee.

(f) Any supplier who removes motor vehicle fuel at a rack and pays tax on that removal or who purchases tax-paid motor vehicle fuel outside the bulk transfer/terminal system and then delivers the tax-paid motor vehicle fuel to another approved terminal from which that supplier subsequently removes the tax-paid motor vehicle fuel at the terminal rack, but only to the extent that the supplier can show that tax on the same amount of motor vehicle fuel has been paid more than one time by the same supplier.

(g) Any supplier who purchases tax-paid motor vehicle fuel in the bulk transfer/terminal system and subsequently removes the tax-paid motor vehicle fuel at the terminal rack, but only to the extent that the supplier can show that tax on the same amount of motor vehicle fuel has been paid more than one time by the same supplier. This subdivision applies only to those purchases made on or after January 1, 2002.

(h) Any person who buys and uses tax-paid motor vehicle fuel for the purpose of producing a blended fuel that will be used to operate motor vehicles upon the public highways of the state that is taxed under Part 3 (commencing with Section 8601) of Division 2. To be eligible, a person must show that the applicable California fuel tax has been paid and must submit or have submitted the refund application request on or after January 1, 2011.

History—Stats. 1943, p. 2703, operative July 1, 1943, added (e), authorizing refunds to persons selling motor vehicle fuel to the United States under certain circumstances. Stats. 1947 (First Extra Session 1947), p. 3815, in effect July 10, 1947, deleted former (d), authorizing refunds to the United States under certain circumstances, and (e). Stats. 1949, p. 2463, in effect October 1, 1949, added present (d). Stats. 1953, p. 3655, in effect July 11, 1953, added the clause beginning "unless" in (b). Stats. 1961, p. 1951, in effect September 15, 1961, added the proviso in (a), deleted (c) permitting refund or reimbursement of tax paid by any employee of the United States who buys motor vehicle fuel and uses it exclusively in transportation of rural free delivery mail and special delivery mail, relettered former (d) as (c), and added present (d). Stats. 1965, p. 4602, in effect September 17, 1965, added (e). Stats. 1968, p. 2296, in effect November 13, 1968, added "except as otherwise provided in this part" in the first sentence and reworded (a), deleting the proviso clause which imposed a one mile requirement on off-highway travel. Stats. 1972, Ch. 1158, effective December 7, 1972, added "or whose government does grant such an exemption to such representatives of the United States," to (e); Ch. 1382 and Ch. 1405, operative January 1, 1973, added the language beginning "except vehicles …" to (a) and affected but did not change (e). Stats. 1973, Ch. 1195, effective October 2, 1973, added the language following "leased for recreational purposes." in (a). Stats. 1990, Ch. 1528, in effect January 1, 1991 added "or her" and "or she" in subdivision (c); substituted current subdivision (e) for former subdivision (e) which provided, "Any consulate officer or consulate employee of a foreign government who is not engaged in any private occupation for gain within the State of California, whose government has entered into a treaty with the United States providing for the exemption of such representative from national, state, and municipal taxes, or whose government does grant such an exemption to such representatives of the United States, who uses the motor vehicle fuel in a vehicle registered exempt from fees pursuant to Section 9100 of the Vehicle Code." Stats. 1999, Ch. 865 (SB 1302), in effect January 1, 2000, added subdivision (f). Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, deleted "license" after "who have paid a" in the first paragraph, added "or aircraft" after "fuel tank of a motor vehicle" in the second sentence of subdivision (b), deleted "license" after "from the payment of the" and substituted "supplier" for "distributor" after "Section 7401 had he or she been the" in subdivision (c); substitited "supplier" for "distributor" after "Any", "which would have entitled the" and "Section 7401 if the", and substituted "(4)" for "(6)" after "exemption under paragraph" in subdivision (e); and deleted subdivision (f). Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002, added subdivisions (f) and (g). Stats. 2012, Ch. 493 (SB 1485), in effect September 23, 2012, substituted "Armed Forces" for "armed forces" after "the motor vehicle fuel to the" in subdivision (c), and added subdivision (h).

Note.—Stats. 1961, p. 1952, contained a declaration that the addition of subdivision (d) did not constitute a change in, but was declaratory of, existing law.

Note.—SEC. 2 of Stats. 2012, Ch. 493 (SB 1485), in effect September 23, 2012, states, "The Legislature finds and declares that this act serves the following public purposes:

a) Correcting the inequality to persons that pay duplicative taxes on fuel.

(b) Offsetting the costs incurred by persons that have paid duplicative taxes by authorizing tax refunds for refund application requests submitted on or after January 1, 2011.

(c) Incentivizing the distribution of alternative, renewable fuels to the public."

Non-highway use.—When rollers and tractors are being used in the repair and construction of highways closed to the public, the public highways are not being "operated upon" in the sense intended by the law and therefore the tax is refundable as respects motor fuel used by such rollers and tractors while engaged in such work. Oswald v. Johnson, (1930) 210 Cal. 321.

Construction.—The person who "uses" motor vehicle fuel includes the lessor of trucks for agricultural purposes, where the lessor purchased the fuel and paid the tax to the vendor of the fuel. DeForest v. Flournoy, (1969) 272 Cal.App.2d 258.

8101.1. Refund; United States Department of Agriculture roads. For the purposes of subdivision (a) of Section 8101, the tax shall be refunded to any person with respect to fuel used in the operation of a motor vehicle on any highway which is under the jurisdiction of the United States Department of Agriculture and with respect to the use of such highway such person pays, or contributes to, the cost of construction or maintenance thereof pursuant to an agreement with or permission of, the United States Department of Agriculture.

History—Added by Stats. 1967, p. 4215, in effect November 8, 1967.

8101.5. Refund; aircraft. [Repealed by Stats. 1989, Ch. 1027, effective September 29, 1989, operative January 1, 1990.]

8101.5. No refund; aircraft. No refund of any tax shall be granted on motor vehicle fuel used in propelling an aircraft in this state.

History—Added by Stats. 1989, Ch. 1027, in effect September 29, 1989, operative January 1, 1990.

8101.6. Refund; public transportation. (a) No refund of any tax shall be granted on motor vehicle fuel used in propelling passenger carrying vehicles, except six cents ($0.06) of the tax imposed upon each gallon of motor vehicle fuel used in propelling passenger carrying vehicles used for the transportation of persons for hire, compensation, or profit of the following:

(1) Any transit district, transit authority, or city owning and operating a local transit system itself or through a wholly owned nonprofit corporation.

(2) Any private entity providing transportation services for the transportation of people under contract or agreement, except general franchise agreements, with a public agency authorized to provide public transportation services, including, but not limited to, any nonprofit corporation designated as a consolidated transportation service agency pursuant to subdivision (a) of Section 15975 of the Government Code, which provides door-to-door transportation services under contract or agreement with a transit district, transit authority, or public agency authorized to provide transportation services, but only for fuels consumed while providing services under those contracts or agreements entered into subsequent to the effective date of this act.

(3) Any passenger stage corporation subject to the jurisdiction of the Public Utilities Commission when the motor vehicles of such passenger stage corporation are exclusively operated in urban or suburban areas or between cities in close proximity; provided, however, that the exemption is not extended to any line or lines operated by such passenger stage corporation which shall exceed 50 miles of one-way route mileage.

(4) Any common carrier of passengers operating exclusively on any line or lines within the limits of a single city between fixed termini or over a regular route, 98 percent of whose operations, as measured by total route mileage operated, are exclusively within the limits of a single city, and who by reason thereof is not a passenger stage corporation subject to the jurisdiction of the Public Utilities Commission.

(b) The exemption provided for in subdivision (a) shall not be applicable to motor vehicle fuel used by a charter-party carrier of passengers. The term "charter-party carrier of passengers" has the same meaning as that specified in Section 5360 of the Public Utilities Code and shall further include those transportation services described in subdivisions (a) and (e) of Section 5353 of the Public Utilities Code, if such transportation service is rendered as contract carriage and not as common carriage of passengers.

(c) There are in the State of California many private entities providing public transportation services for the transportation of people in vehicles other than buses under contract or agreement with local government, transit districts or local bus transit operators. It is the purpose of this section to provide relief from the payment of fuel tax for gasoline fuel for those private entities only for fuels consumed while providing these services.

History—Added by Stats. 1978, Ch. 1140, operative January 1, 1979. Stats. 1979, Ch. 373, effective January 1, 1980, changed "excepts" to "except" in (a) (2). Stats. 1982, Ch. 762, in effect September 8, 1982, added "or any … services" after "corporation" in subsection (1) of subdivision (a). Stats. 1982, Ch. 1500, in effect September 28, 1982, deleted "or any … services" after "corporation" in subsection (1) of, and added "for the transportation of people" before "under" in subsection 2 of, subdivision (a). Stats. 1983, Ch. 46, in effect January 1, 1984, added "including, … services, but" before "only" and substituted "those" for "such" before "contracts" in subsection (2) of subdivision (a) and added subdivision (c).

Note.—Section 2 of Stats. 1983, Ch. 46, provided the "Legislature finds and declares that the amendments made to Section 8101.6 of the Revenue and Taxation Code by this act are declaratory of existing law."

8101.7. Refund; vessel. No refund of any tax shall be granted which is attributable to the distribution of motor vehicle fuel for use or used in propelling a vessel in the state, except any tax which is attributable to the distribution of motor vehicle fuel for use or used in propelling a vessel operated by its owner on waters located on private property owned or controlled by him.

History—Added by Stats. 1968, p. 1038, in effect November 13, 1968. Stats. 1969, p. 131, in effect November 10, 1969, substituted "sales" for "rates" in the third paragraph. Stats. 1971, p. 2790, operative July 1, 1972, rearranged wording and deleted last sentence declaring legislative intent.

Note.—Stats. 1968, p. 1038, in effect November 13, 1968, provides that "The provisions of this act shall apply to fuel purchased after 12:01 a.m. of the day on which this act becomes effective."

8102. Claim for refund. (a) The claimant of a refund shall present to the Controller a claim supported by the original invoice showing the purchase or other evidence of each purchase that is satisfactory to the Controller. The claim shall state the total amount of the fuel purchased by the claimant and the manner and the equipment in which the claimant has used the fuel. The claim shall state the total amount of motor vehicle fuel covered by the claim and if the motor vehicle fuel was exported, a statement that the claimant has proof of exportation. The claim shall state that the amounts claimed have not been previously refunded to the claimant and that there are no other claims outstanding for the amounts included in the current claim for refund. The claim shall not be under oath but shall contain, or be accompanied by, a written declaration that it is made under the penalties of perjury. If no original invoice was created, electronic invoicing shall be accepted as reflected by a computerized facsimile when accompanied by an original copy of the bill of lading or fuel manifest that can be directly tied to the electronic invoice.

(b) Each claim for refund under this section shall be made on a form prescribed by the Controller and shall be filed for a calendar year, except for claims relating to exportation of fuel. If, at the close of any of the first three quarters of the calendar year, more than seven hundred fifty dollars ($750) is refundable under this section with respect to any motor vehicle fuel used, sold, or exported during that quarter or any prior quarter during the calendar year, and for which no other claim has been filed, a claim may be filed for the quarterly period. To facilitate the administration of this section, the Controller may require the filing of claims for refund for other than yearly periods. Export claims may be filed at any time.

History—Stats. 1947 (First Extra Session 1947), p. 3815, in effect July 10, 1947, substituted claim made under penalties of perjury for affidavit as basis for refund. Stats. 1959, p. 4417, in effect September 18, 1959, deleted "the fact that the claimant has paid the price of the fuel" from the second sentence and added "by the claimant" in the same sentence. Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997, added subdivision designation "(a)", added third sentence and last sentence to subdivision (a), and added subdivision (b). Stats. 2003, Ch. 697 (AB 1741), effective January 1, 2004, added "or other evidence of each purchase that is satisfactory to the Controller" after "invoice showing the purchase" in the first sentence of subdivision (a).

8103. Amount of refund. The Controller, upon the presentation of the properly completed claim and the invoice or other evidence of each purchase that is satisfactory to the Controller, shall cause to be paid to the claimant from the taxes collected under this part an amount equal to the taxes collected on the motor vehicle fuel in respect to which the refund is claimed.

History—Stats. 1947 (First Extra Session 1947), p. 3815, in effect July 10, 1947, substituted "claim" for "affidavit." Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997, added "properly completed" after "presentation of the" in the first sentence and added the second sentence. Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, deleted "license" after "to the claimant from the" and "an amount equal to the" in the first sentence. Stats. 2003, Ch. 697 (AB 1741), effective January 1, 2004, added "or other evidence of each purchase that is satisfactory to the Controller" after "completed claim and the invoice" and deleted the former second sentence.

8103.5. Penalty for false claim. Any person who wilfully makes or subscribes to a claim for refund under this article which he does not believe to be true and correct as to every material matter, shall be guilty of a felony, and upon conviction thereof shall be subject to the penalties prescribed for perjury by the Penal Code.

History—Added by Stats. 1947 (First Extra Session 1947), p. 3815, in effect July 10, 1947.

8104. Controller may examine records of claimant. In order to establish the validity of any claim the Controller may, upon demand, examine the books and records of the claimant for that purpose. The failure of the claimant to accede to that demand constitutes a waiver of all right to the refund claimed on account of the transactions questioned. The examination may be made either through employees of the office of the Controller or of the office of the board. Supporting evidence of all purchases included in a claim for refund shall be maintained by the claimant for inspection by the Controller or the office of the board for four years after the date of refund.

History—Stats. 2003, Ch. 697 (AB 1741), effective January 1, 2004, substituted "that" for "such" after "claimant for" in the first sentence and after "to accede to" in the second sentence, and added the fourth sentence.

8104.5. Controller's extension of time for filing for refund. If any person does not use motor vehicle fuel as provided in subdivision (a) of Section 8101 within the time required for filing an application for a refund, he may within that time file a written request with the Controller for an extension of time within which to apply for a refund. The request shall state the amount of fuel involved, the date of its purchase, and the manner and the equipment in which the fuel is intended to be used. Thereupon the Controller may extend the time within which an application for refund may be filed.

History—Added by Stats. 1943, p. 1995, in effect July 1, 1943.

8105. Time for filing refund claims. All applications for refund provided under this article shall be filed within three years from the date of the purchase of the motor vehicle fuel or, if the tax was not invoiced at the time of the purchase of the motor vehicle fuel, the application for refund shall be filed within six months after the receipt of an invoice for the tax, whichever period expires later. Any application filed after the time prescribed shall not be considered for any purpose by the Controller, the Treasurer, or the state.

History—Stats. 1943, p. 1995, in effect July 1, 1943, added to second sentence proviso relating to extension of time. Stats. 1957, p. 1891, in effect September 11, 1957, added "under Section 8101"; substituted "three months" for "90 days"; added "for refund provided under said Section"; substituted "13" for "12" months. Stats. 1963, p. 1271, in effect September 20, 1963, substituted "after the close of the calendar month in which fuel is exported" for "from the date of exportation." Stats. 1972, Ch. 1273, in effect March 7, 1973, substituted "this article" for "said section" in the third sentence. Stats. 1989, Ch. 437, in effect January 1, 1990, substituted "state" for "State", added "the later of" after "the Controller within", and added "or 13 months from the date of purchase of the fuel" in the first sentence, deleted "The Controller for good cause may extend for not more than six months the time for which the claim for refund may be filed on account of the exportation, provided a request therefor is filed with the Controller within or prior to the period for which the extension may be granted.", and deleted "State" and substituted "state" in the last sentence. Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997, substituted "provided under this article shall be filed within three years" for "under Section 8101 based upon exportation of motor vehicle fuel from this state shall be filed with the Controller within the later of three months after the close of the calendar month in which the fuel is exported or 13 months from the date of the purchase of the fuel. All other applications for refund provided under this article, except where an extension of time has been granted, shall be filed within 13 months" after "applications for refund" in the first sentence, and deleted "state" before "Treasurer" in the last sentence. Stats. 2003, Ch. 605 (SB 1060), effective January 1, 2004, added "or, if the tax was not invoiced … whichever period expires later" after "purchase of the motor vehicle fuel" in the first sentence.

Refund for exportation of tax-paid fuel.—When plaintiff's subsequent use of its tax-paid fuel entitle it to a refund of taxes which it had indirectly paid through an addition to the purchase price, the applicable provisions are refund provisions, not exemption provisions. Willbarb Petroleum Carriers, Inc. v. Cory (1989) 208 Cal.App.3d 269.

8106. Credit in lieu of refund. In lieu of the collection and refund of the tax on tax-paid motor vehicle fuel exported, removed, sold, or used by a supplier in a manner that would entitle the supplier to claim a refund under Section 8101, credit may be given the supplier upon the supplier's tax return and the determination of the amount of tax shall be determined in accordance with any rules and regulations the board may prescribe.

History—Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, substituted "supplier in the" for "distributor in such a" after "vehicle fuel used by a" and substituted "supplier upon the supplier's" for "distributor upon his". Stats. 2006, Ch. 364 (AB 3076), in effect January 1, 2007, added "tax-paid" after "refund of the tax on", added "exported, removed, sold, or" after "motor vehicle fuel", substituted "a" for "the" after "by a supplier", substituted "that" for "as" after "manner", substituted "the supplier" for "a purchaser" after "would entitle", added "a" after "to claim", substituted "Section 8101" for "this article" after "refund under", added a comma after "supplier's tax return", and added "shall be determined in accordance with any rules and regulations the board may prescribe" after "the amount of tax".

8106.1. Credit in lieu of refund; foreign consulate sales. [Repealed by Stats. 2006, Ch. 364 (AB 3076), operative January 1, 2007.]

8106.5. Credit in lieu of refund; exported fuel. [Repealed by Stats. 2006, Ch. 364 (AB 3076), operative January 1, 2007.]

8106.7. Credit in lieu of refund; qualified distributor. [Repealed by Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002.]

8106.8. Credit in lieu of refund; tax-paid fuel removed at rack. [Repealed by Stats. 2006, Ch. 364 (AB 3076), operative January 1, 2007.]

8107. No refund on losses. No refund shall be granted for losses in handling, transporting, or storing motor vehicle fuel.

8108. Interest. If any claim for refund of tax is paid more than 20 calendar days from the date upon which the claim was received by the Controller, interest shall be computed, allowed, and paid upon that refund of tax at the Pooled Money Investment Account's Annual Yield Rate in effect on the date prior to the date that the interest on the refund of tax begins to accrue. Interest on the refund of tax shall begin to accrue on the 21st calendar day after the date that a properly completed claim for refund is received by the Controller. The interest shall accrue through the date the Controller refunds the tax. No interest shall be granted on credits taken on tax returns.

History—Added by Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997.

8109. Claim payment deadline. (a) A refund filed pursuant to subdivision (b) of Section 8101 shall be paid to the claimant within 20 calendar days of the receipt of a claim for refund by the Controller.

(b) Notwithstanding subdivision (a), the claim for refund shall be submitted on a properly completed form or in substantially similar format, as prescribed by the Controller.

History—Added by Stats. 1997, Ch. 76 (SB 612), in effect July 16, 1997.

Article 2. Claim for Refund

8126. Refund in case of excess payments. If the department determines that any amount not required to be paid under this part has been paid by any person to the state, the department shall set forth that fact in its records and certify the amount collected in excess of the amount legally due and the person from whom it was collected and certify the amount to the Controller for credit or refund. Any determination by the department pursuant to this section with respect to an amount in excess of fifty thousand dollars ($50,000) shall be available as a public record for at least 10 days after the effective date of that determination.

History—Stats. 1945, p. 1065, operative July 1, 1945, deleted reference to section 8191 as it read prior to its repeal by said act. Stats. 1959, p. 2471, in effect September 18, 1959, added last sentence. Stats. 1961, p. 1253, in effect September 15, 1961, substituted "one hundred dollars ($100)" for "twenty-five dollars ($25)." Stats. 1963, p. 3106, in effect September 20, 1963, added "set forth that fact in its records and" in the first sentence, and substituted "two hundred fifty dollars ($250)" for "one hundred dollars ($100)" in the second paragraph. Stats. 1965, p. 2053, in effect September 17, 1965, substituted "one thousand dollars ($1,000)" for "two hundred fifty dollars ($250)." Stats. 1977, Ch. 921, operative January 1, 1978, substituted "five thousand dollars ($5,000)" for "one thousand dollars ($1,000)" in the second paragraph. Stats. 1985, Ch. 591, effective January 1, 1986, substituted "fifteen thousand dollars ($15,000)" for "five thousand dollars ($5,000)" in second paragraph. Stats. 1988, Ch. 1029, in effect January 1, 1989, substituted "fifty thousand dollars ($50,000)" for "fifteen thousand dollars ($15,000)" in the second paragraph. Stats. 1994, Ch. 726, in effect September 22, 1994, deleted "to the State Board of Control" after "records and certify"; deleted ", if the State Board of Control approves, shall" after "it was collected and"; added "Any proposed determination … of that determination." as the second sentence; and deleted the second paragraph which read: "In the case, however, of a determination by the board that an amount not exceeding fifty thousand dollars ($50,000) was not required to be paid under this part, the board without obtaining the approval of the State Board of Control, may certify the amount to the Controller for credit or refund." Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, added "that is licensed as a supplier" after "has been paid by any person" in the first sentence. Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002, substituted "to the state" for "that is licensed as a supplier" after "paid by any person" in the first sentence. Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002, substituted "to the state" for "that is licensed as a supplier" after "paid by any person" in the first sentence. Stats. 2022, Ch. 474 (SB 1496), in effect January 1, 2023, substituted "department" for "board" throughout; and deleted "proposed" after "Any" and substituted "after" for "prior to" after "10 days" in the second sentence.

8127. Credits and refunds. The Controller shall thereupon credit the excess on any amounts then due from the person under this part and refund the balance to the person or his successors, administrators, executors, or assigns.

8127.5. Excess tax reimbursement. When an amount represented by a person who is a taxpayer under this part to a customer as constituting reimbursement for taxes due under this part is computed upon an amount that is not taxable or is in excess of the taxable amount and is actually paid by the customer to the person, the amount so paid shall be returned by the person to the customer upon notification by the Board of Equalization or by the customer that the excess has been ascertained. If the person fails or refuses to do so, the amount so paid, if knowingly or mistakenly computed by the person upon an amount that is not taxable or is in excess of the taxable amount, shall be remitted by that person to this state. Those amounts remitted to the state shall be credited by the Controller on any amounts due and payable under this part on the same transaction from the person by whom it was paid to this state and the balance, if any, shall constitute an obligation due from the person to this state.

History—Added by Stats. 1996, Ch. 1087, in effect January 1, 1997.

8127.6. Tax reimbursement; qualified distributor. [Repealed by Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002.]

8128. Claim; limitation period. (a) Except as provided in subdivision (b) no refund under this article shall be approved by the board after three years from the last day of the month following the month for which the overpayment was made, or with respect to determinations made under Article 3, 4, or 5 of Chapter 5 of this part, after six months from the dates the determinations become final, or after six months from the date of overpayment, whichever period expires the later, unless a claim therefor is filed with the board within that period. No credit shall be approved by the board after the expiration of that period unless a claim for credit is filed with the board within that period, or unless the credit relates to a period for which a waiver is given pursuant to Section 7676.

(b) A refund may be approved by the board for any period for which a waiver is given under Section 7676 if a claim therefor is filed with the board before the expiration of the period agreed upon.

History—Stats. 1959, p. 2471, in effect September 18, 1959, completely revised this section which formerly had only a three-year period. Stats. 1965, p. 4440, in effect September 17, 1965, rewrote this section to provide for refunds under certain circumstances. Stats. 1983, Ch. 1102, in effect September 27, 1983, operative November 1, 1983, substituted "25th day of the calendar month" for "first day of the second calendar month" before "following" in the first sentence of subdivision (a). Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, substituted "last" for "25th" after "after three years from the", added "calendar" after "day of the", substituted "under Article 3, 4, or 5" for "under Article 2, 2.5 or 3" after "or with respect to determinations made", substituted "that" for "such" after "filed with the board with" in the first sentence of subdivision (a); substituted "that" for "such" after "board after the expiration of" in the second sentence of subdivision (a).

8128.1. Claim limitation; financially disabled. (a) The limitation period specified in Section 8128 shall be suspended during any period of a person's life that the person is financially disabled.

(b) (1) For purposes of subdivision (a), a person is financially disabled if the person is unable to manage his or her financial affairs by reason of medically determinable physical or mental impairment of the person which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. A person shall not be considered to have an impairment unless proof of the existence thereof is furnished in the form and manner as the board may require.

(2) A person shall not be treated as financially disabled during any period that the person's spouse or any other person is authorized to act on behalf of the person in financial matters.

(c) This section applies to periods of disability commencing before, on, or after the effective date of the act adding this section, but does not apply to any claim for refund that (without regard to this section) is barred by the operation or rule of law, including res judicata, as of the effective date of the act adding this section.

History—Added by Stats. 2000, Ch. 1052 (AB 2898), in effect January 1, 2001.

8129. Form and content of claim. The claim shall be in writing and shall state the specific grounds upon which it is founded.

8130. Interest on erroneous overpayments. Interest shall be paid upon any overpayment of any amount of tax at the modified adjusted rate per month established pursuant to Section 6591.5, from the first day of the month following the period during which the overpayment is made. In addition, a refund or credit shall be made of any interest imposed upon the claimant with respect to the amount being refunded or credited.

The interest shall be paid as follows:

(a) In the case of a refund, to the last day of the month following the date upon which the person making the overpayment, if he or she has not already filed a claim, is notified by the board that a claim may be filed or the date upon which the claim is approved by the board, whichever date is the earlier.

(b) In the case of a credit, to the same date as that to which interest is computed on the tax or amount against which the credit is applied.

History—Added by Stats. 1943, p. 2707, operative July 1, 1943, as Section 8193. Renumbered Section 8130 by Stats. 1945, p. 1066, operative July 1, 1945. Stats. 1963, p. 3107, in effect September 20, 1963, substituted the numerical figures "10th" and "30th" for the words "tenth" and "thirtieth" in paragraph (a). Stats. 1975, Ch. 661, operative to interest accruing on or after January 1, 1976, substituted "1 percent" for "one-half of 1 percent." Stats. 1982, Ch. 5, First Extra Session, in effect May 27, 1982, substituted "adjusted … 19269" for "rate … month" before "from" in the first sentence. Stats. 1983, Ch. 1102, in effect September 27, 1983, operative November 1, 1983, substituted "25th day of the calendar month" for "first day of the second calendar month" before "following" in the first sentence. Stats. 1984, Ch. 1020, effective January 1, 1985, operative July 1, 1985, substituted "modified … month" for "adjusted annual rate" before "established," substituted "Section 6591.5" for "Section 19269," deleted "calendar" before "month" in first paragraph, deleted all text of (a) and added all new text. Stats. 1992, Ch. 1336, in effect January 1, 1993, substituted "26th" for "25th" after "from the", deleted "monthly" before "period", substituted "during" for "for" after "period", and substituted ". In addition, a" for "; but no" in the first sentence; and added "as follows" after "paid" in the second paragraph. Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, substituted "first" for "26th" after "Section 6591.5, from the" in the first sentence of the first paragraph, substituted "last" for "25th" after "In the case of a refund, to the" in subdivision (b).

8131. When interest not allowed. (a) If the board determines that any overpayment has been made intentionally or by reason of carelessness, it shall not allow any interest thereon.

(b) If any person who has filed a claim for refund requests the board to defer action on the claim, the board, as a condition to deferring action, may require the claimant to waive interest for the period during which the person requests the board to defer action on the claim.

History—Stats. 1945, p. 1066, operative July 1, 1945, renumbered section 8194 as section 8131. Stats. 1998, Ch. 420 (SB 2230), in effect January 1, 1999, added subdivision designation "(a)" and added subdivision (b).

Article 3. Suit for Refund

8146. Injunction forbidden. No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action, or proceeding in any court against this state or against any officer of the state to prevent or enjoin the collection under this part of any tax determined by the board.

History—Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, substituted "state" for "State" after "in any court against this" and "against any officer of the", and deleted "license" after "under this part of any".

Purchaser may not question tax.—The purchaser of motor vehicle fuel may not question the constitutionality of the tax. Williams v. Riley, (1929) 280 U.S. 78.

8147. Action for refund. No suit or proceeding shall be maintained in any court for the recovery of any amount collected or paid under this part unless a claim for refund or credit has been duly filed under Article 1 or 2 of this chapter.

History—Stats. 1959, p. 2471, in effect September 18, 1959, completely revised this section which had previously provided for a payment under protest and suit in Sacramento County.

Note.—Stats. 1959, p. 2471, amended Sections 8147, 8148, 8149, and added Section 8149.5 provides: "Nothing contained in this act shall be construed to prevent the commencement or maintenance of any action for the recovery of taxes paid under protest prior to the date on which this act takes effect."

8148. Action; limitation period. Within 90 days after the mailing of the notice of action upon a claim for refund or credit, the claimant may bring an action against the Controller with respect to a claim under Article 1 of this chapter, or against the board with respect to a claim filed under Article 2 of this chapter on the grounds set forth in the claim in a court of competent jurisdiction in the County of Sacramento for the recovery of the whole or any part of the amount with respect to which the claim has been disallowed.

History—Stats. 1949, p. 1342, in effect October 1, 1949, substituted one year for 90 days and "payment of the license tax sought to be recovered" for "last day prescribed for the payment of the license tax without penalty." Stats. 1959, p. 2472, in effect September 18, 1959, completely revised this section which previously provided for a year limitation.

Note.—See note following Section 8147.

8149. When refund claim not acted upon. If the board or the Controller fails to mail notice of action on a claim within six months after the claim is filed, the claimant may, prior to the mailing of notice, consider the claim disallowed and bring an action against the Controller or the board on the grounds set forth in the claim for the recovery of the whole or any part of the amount claimed.

History—Stats. 1959, p. 2472, in effect September 18, 1959, completely changed the subject matter of this section.

Note.—See note following Section 8147.

8149.5. Failure to bring timely suit. Failure to bring suit or action within the time specified in this article constitutes a waiver of all demands against the State on account of any alleged claim.

History—Added by Stats. 1959, p. 2472, in effect September 18, 1959.

Note.—See note following Section 8147.

8150. Judgment credits and refunds. If judgment is rendered for the plaintiff, the amount of the judgment shall first be credited on any taxes due from the plaintiff under this part, Part 3 (commencing with Section 8601), and Part 31 (commencing with Section 60001), and the balance of the judgment shall be refunded to the plaintiff.

History—Stats. 1995, Ch. 555, in effect January 1, 1996, added "Part 3 (commencing … with Section 60001)," after "under this part,". Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, deleted "license" after "first be credited on any".

8151. Interest on judgment. In any judgment, interest shall be allowed at the modified adjusted rate per annum established pursuant to Section 6591.5 upon the amount found to have been illegally collected from the date of payment thereof to the date of allowance of credit on account of the judgment or to a date preceding the date of the refund warrant by not more than 30 days, the date to be determined by the board.

History—Added by Stats. 1975, Ch. 661, operative to interest accruing on or after January 1, 1976, substituted "12 percent" for "6 percent." Stats. 1982, Ch. 5, First Extra Session, in effect May 27, 1982, substituted "adjusted … 19269" for "rate … annum" before "upon." Stats. 1984, Ch. 1020, effective January 1, 1985, operative July 1, 1985, substituted "modified … per annum" for "adjusted annual rate," substituted "Section 6591.5" for "Section 19269." Stats. 1995, Ch. 555, in effect January 1, 1996, deleted "of the license tax" after "upon the amount".

8152. Judgment for assignee forbidden. A judgment shall not be rendered in favor of the plaintiff in any action brought against the State Treasurer to recover any tax paid when the action is brought by or in the name of an assignee of the supplier paying the tax or by any person other than the person who paid the tax.

History—Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002, deleted "license" after "State Treasurer to recover any" and "other than the person who paid the", and substitutued "supplier" for "distributor" after "name of an assignee of the".

Article 4. Recovery of Erroneous Refunds

8171. Controller's recovery of erroneous refunds. (a) The Controller may recover any refund or part thereof that is erroneously made, and any credit or part thereof that is erroneously allowed, in an action brought in a court of competent jurisdiction in the County of Sacramento in the name of the people of the State of California.

(b) As an alternative to subdivision (a), the board may recover any refund or part thereof that is erroneously made, and any credit or part thereof that is erroneously allowed. In recovering any erroneous refund or credit, the board may, in its discretion, issue a deficiency determination in accordance with Article 2.5 (commencing with Section 7670) or Article 3 (commencing with Section 7698) of Chapter 5. Except in the case of fraud, the deficiency determination shall be made by the board within three years from the date of the Controller's warrant or date of credit.

History—Stats. 1998, Ch. 609 (SB 2232), in effect January 1, 1999, added subdivision designation "(a)", substituted "that" for "which" after "or part thereof" in subdivision (a), and added subdivision (b).

Note.—SEC. 61. of Stats. 1998, Ch. 609 (SB 2232), effective January 1, 1999, states: It is the intent of the Legislature in enacting those provisions of this act that allow the State Board of Equalization to recover refunds administratively that no increase in taxpayer costs result from taxpayer compliance with these provisions.

8172. Place of trial. In any action brought pursuant to subdivision (a) of Section 8171, the court may, with the consent of the Attorney General, order a change in the place of trial.

History—Stats. 1998, Ch. 609 (SB 2232), in effect January 1, 1999, substituted "In any action … change in the" for "The action shall be tried in the County of Sacramento unless the court with the consent of the Attorney General orders a change of".

8173. Rules of procedure. The Attorney General shall prosecute any action brought pursuant to subdivision (a) of Section 8171, and the provisions of the Code of Civil Procedure relating to service of summons, pleadings, proofs, trials, and appeals shall apply to the proceedings.

History—Stats. 1998, Ch. 609 (SB 2232), in effect January 1, 1999, substituted "any action brought … Code" for "the action, and the provisions of the code" after "General shall prosecute" and substituted "shall apply" for "are applicable" after "trials, and appeals".

8174. Interest on erroneous refunds. (a) Notwithstanding any other provision of this part, if the department finds that neither the person liable for payment of tax nor any party related to that person has in any way caused an erroneous refund for which an action for recovery is provided under Section 8171, no interest shall be imposed on the amount of that erroneous refund until 30 days after the date on which the department serves a notice of determination for repayment of the erroneous refund to the person. The act of filing a claim for refund shall not be considered as causing the erroneous refund.

(b) This section shall be operative for any action for recovery under Section 8171 on or after January 1, 2000.

History—Added by Stats. 1999, Ch. 929 (AB 1638), in effect January 1, 2000. Stats. 2024, Ch. 499 (SB1528), in effect January 1, 2025, substituted "department" for "board" after "if the" and "department serves" for "board mails" after "which the" in the first sentence of subdivision (a).

Article 5. Cancellations

8191. Correction of erroneous determination. If the department determines that any amount has been illegally determined to be due from any person either by the person filing the return or by the department, the department shall set forth that fact in its records, certify the amount determined to be in excess of the amount legally due and the person against whom the determination was made, and authorize the cancellation of the amount upon the records of the department and the Controller. Any determination by the department pursuant to this section with respect to an amount in excess of fifty thousand dollars ($50,000) shall be available as a public record for at least 10 days after the effective date of that determination.

History—Stats. 1945, p. 1065, operative July 1, 1945, repealed original Section 8191 (relating to determinations where returns incorrect), renumbered Section 8192 as Section 8191 and deleted reference therein to the original section. Stats. 1959, p. 2472, in effect September 18, 1959, added "and the board" to the end of the last sentence. Stats. 1961, p. 1252, in effect September 15, 1961, added the provision which allows the board to authorize the cancellation of illegally determined motor vehicle fuel license taxes of $100 or less without the approval of the State Board of Control. Stats. 1963, p. 3107, in effect September 20, 1963, added "If the board determines that" and "set forth that fact in its records" in the first sentence, and substituted "two hundred fifty dollars ($250)" for "one hundred dollars ($100)" in the first and last sentences. Stats. 1965, p. 2053, in effect September 17, 1965, in the first and second sentences substituted "one thousand dollars ($1,000)" for "two hundred fifty dollars ($250)." Stats. 1977, Ch. 921, operative January 1, 1978, substituted "five thousand dollars ($5,000)" for "one thousand dollars ($1,000)" in the first and last sentence. Stats. 1985, Ch. 591, effective January 1, 1986, substituted "fifteen thousand dollars ($15,000)" for "five thousand dollars ($5,000)" after "the amount upon the records of the board and the Controller. If an amount not exceeding". Stats. 1988, Ch. 1029, in effect January 1, 1989, substituted "fifty thousand dollars ($50,000)" for "fifteen thousand dollars ($15,000)" before "has been illegally determined" in the first and last sentences. Stats. 1994, Ch. 726, in effect September 22, 1994, deleted "in excess of fifty thousand dollars ($50,000)" after "that any amount"; substituted a comma for "and" after "in its records"; deleted "to the State Board of Control" after "certify"; substituted ", and" for ". If the State Board of Control approves, it shall" after "determination was made"; and substituted "Any proposed determination … of that determination." for "If an amount not exceeding fifty thousand dollars ($50,000) has been illegally determined either by the person filing a return or by the board, the board without certifying this fact to the State Board of Control shall authorize the cancellation of the amount upon the records of the board." Stats. 2022, Ch. 474 (SB 1496), in effect January 1, 2023, substituted "department" for "board" throughout; and deleted "proposed" after "Any" and substituted "after" for "prior to" after "10 days" in the second sentence.