Refund Claims for Diesel Fuel and Motor Vehicle Fuel Tax
Refund Claim—Overpayment on Tax Return Filed
If you have overpaid the tax directly to us, you may file a claim for refund. Please see the Resources page for general refund information.
If the general statute of limitations has passed, we may approve a refund for an overpayment on a tax return filed for any period for which a waiver of limitation is given under Revenue & Taxation Code (R&TC) section 60317. The claim for refund must be filed with us before the expiration of the agreed upon extension.
Filing With the State Controller's Office—Motor Vehicle Fuel
The State Controller's Office (SCO) maintains the accounts receivable records for the Motor Vehicle Fuel Tax program and is responsible for collecting delinquent monies. They also receive and process claims for refund on tax-paid fuel used in a nontaxable manner.
The following claims for refund must be filed with SCO and may not be taken as a credit on your Supplier of Motor Vehicle Fuel Tax Return.
- Refund; United States Department of Agriculture Roads, R&TC section 8101.1.
- Refund; Public Transportation, R&TC section 8101.6.
- Refund; Vessel, R&TC section 8101.7.
Email or mail SCO claims to:
State Controller's Office
Tax Administration Section
Gas Tax Refund Program
P.O. Box 942850
Sacramento, CA 94250-5880
Refunds on Certain Sales and Uses—Diesel Fuel
Refunds of diesel fuel tax may have different filing deadlines.
Generally, the time frame for which to file your diesel fuel claim for refund is as follows:
- Within three years from the date of purchase, or
- If the tax was not invoiced at the time of the purchase of the diesel fuel, the refund claim shall be filed within six months after the receipt of an invoice for tax, whichever period expires later.
A waiver of limitations given under R&TC section 60317 does not extend the statute of limitations for refunds under R&TC sections 60501 and 60502. Examples of these types of refunds include but are not limited to the following examples.
- Used for purposes other than operating motor vehicles upon the public highways of the state.
- Exported for use outside of this state.
- Lost in the ordinary course of handling, transportation, or storage.
- Removed from an approved terminal at the terminal rack, but only to the extent that the supplier can show that the tax on the same amount of diesel fuel has been paid more than one time by the same supplier.
- Sold to the ultimate purchaser for use on a farm for farming purposes or for use in an exempt bus operation.
The following diesel fuel refund claims may be filed through our online services:
- Licensed Ultimate Vendor
- Licensed Supplier
- Government Entity
- Diesel Fuel User
- Exporter and Exempt Sales
- Licensed Supplier or any Person
Diesel Fuel Exempt User Refund Claims
A diesel fuel exempt user includes any person who purchases tax-paid diesel fuel and uses it in a nontaxable manner.
Register with us through our online services webpage to obtain a diesel fuel user account and to submit your CDTFA-32, Diesel Fuel Tax Claim for Refund Questionnaire and Equipment List. An updated diesel questionnaire should be submitted every three years. You can update your equipment list anytime you have any changes, deletions, or additions.
There is no filing requirement unless you have a claim for refund to submit. For more filing information please see our Motor Fuels Online Filing webpage.
A diesel fuel exempt user does not include ultimate purchasers, such as farmers and exempt bus operators. Refunds of tax on these types of uses can only be claimed by the fuel supplier.
Safe-harbor percentages are amounts of fuel presumed to be the percentages of diesel fuel used in the operation of auxiliary equipment on diesel power motor vehicles. Safe-harbor percentages must be applied to diesel fuel consumption by auxiliary equipment type. Off-highway use is included in the safe-harbor percentages.
Please reference Diesel Fuel Tax Regulation 1432, Other Nontaxable Uses of Diesel Fuel in a Motor Vehicle, for a list of safe-harbor percentages.
Diesel Fuel Ultimate Vendor Refund Claims
Ultimate vendor means a person who sells undyed diesel fuel to the user of the diesel fuel (the ultimate purchaser) for use on a farm for farming purposes or for use in an exempt bus operation.
The deadline for filing a claim for refund is:
- Three years from the date of purchase, or
- If the tax was not invoiced at the time of the purchase of the diesel fuel, six months after the receipt of an invoice for the tax, whichever period expires later.
Please see the Ultimate Vendor page for more information.
Diesel Fuel Exempt Seller—Nontaxable Sales and Exports Refund Claims
A diesel fuel exempt seller includes any person who is not a licensed ultimate vendor who exports or sells for exempt purposes, without collecting the diesel fuel tax reimbursement, undyed diesel fuel. If you export or sell tax-paid diesel fuel to exempt customers (U.S. government, train operators, and others) and are not a licensed ultimate vendor or supplier of diesel fuel, you are an exempt seller.
Diesel fuel exempt sellers must register through our online services webpage before filing claims for refund of the tax paid on undyed diesel fuel:
- For use outside California,
- Sold to the U.S. Government,
- Sold to train operators for use in a diesel-powered train or for other off-highway use, or
- Used in operations for purposes other than propelling vehicles on the highway in California.
Registered exempt sellers may file a Claim for Refund on Nontaxable Sales and Exports of Diesel Fuel online by logging into your online services account.
You must file your claim for refund:
- within three years from the date the fuel was purchased, or
- if the tax was not invoiced at the time of the purchase of the diesel fuel, within six months after the receipt of an invoice for the tax, whichever period expires later.
For further guidance regarding tax-paid undyed diesel fuel exported, please see Regulation 1430, Shipments Out of State.
For sales to the United States and its agencies and instrumentalities, please see Regulation 1434, Sales of Diesel Fuel to the United States and its Agencies and Instrumentalities.
Licensed Diesel Fuel and MVF Supplier—Credit in Lieu of Filing a Refund Claim
The following types of tax paid credits may be allowed on your Supplier of Motor Vehicle Fuel Tax Return or Supplier of Diesel Fuel Tax Return, in lieu of filing a claim for refund:
- Tax paid fuel exported; see Regulation 1161 or Regulation 1430. If you do not take a credit on a tax return filed within three months after the close of the calendar month in which the export was made, you must file a claim for refund with us to recover the tax. See Exported Fuel Documentation below.
- Tax paid fuel sold to a consulate officer or employee by credit card.
- Tax paid fuel removed from the rack when tax is paid twice.
- Tax paid fuel sold to train operators.
- Tax paid MVF used 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.
- Sales of tax paid MVF to the Armed Forces of the United States for use in ships or aircraft or for use outside of California.
- Tax paid diesel fuel sold to the United States government.
- Tax paid diesel fuel sold for use on farms.
- Tax paid diesel fuel sold to exempt bus operators.
- Tax paid diesel fuel used off-highway.
Motor Vehicle Fuel Supplier Bad Debts
You may not claim a refund of motor vehicle fuel tax for bad debts on sales of motor vehicle fuel.
Diesel Fuel Supplier Bad Debts—Refund Claims
When you find that a customer has not paid the amount owed for diesel fuel purchases, you may claim a bad debt loss credit.
You may claim a bad debt loss credit when you:
- Cannot collect an amount a customer owes on the sale of diesel fuel,
- Find the customer's account worthless and charge it off for income tax purposes, and
- Have paid the diesel fuel tax on the sale with your Supplier of Diesel Fuel Tax Return.
You may either claim a credit on Summary Schedule S04 for the reporting period in which you find the customer's account worthless, or you may file a refund claim by using our online services for the amount of tax overpaid. Generally, you must file the claim for refund or claim the credit within three years of the date the tax return was due for the reporting period in which you charged off the sale for income tax purposes.
If you receive payment on a bad debt after you have filed a claim for refund or claimed a credit, you must report the payment as a taxable transaction on the first return filed after receipt of payment.
You should maintain the following information and records to document a bad debt deduction:
- Date of the original sale of the diesel fuel.
- Name and address of the purchaser.
- Number of gallons and dollar amount of bad debt.
- Invoices that show the tax was charged.
- Amount of tax you paid on the transaction to us.
- All payments or other credits applied to the purchaser's account.
- Evidence that the debt has been properly charged off for income tax purposes.
Fuel Lost in The Course of Handling, Transportation, or Storage
If you lose fuel in the course of handling, transportation, or storage, you may file a claim for refund with us. You may not take a credit instead of filing a claim for refund. We cannot grant refunds based on losses of fuel that occur due to evaporation or shrinkage.
For more detailed information please see Regulation 1433, Refund of Tax on Diesel Fuel Lost in the Course of Handling, Transportation, or Storage.
Exported Fuel Documentation
When you export tax-paid fuel, you may take a credit or claim a refund for the taxes paid when the fuel was purchased. All claims for refund of tax paid on exported fuel must be supported by documents that include the following:
- The total amount of fuel covered by the claim.
- A copy of the purchase invoice for the fuel showing the name, address, telephone number and permit number of the person who sold the fuel to you, the date the fuel was purchased, number of gallons, a separately stated amount of tax, and, for diesel fuel, a statement that the diesel fuel purchased did not contain visible evidence of dye.
- A properly executed bill of lading showing intent to export the fuel to an out-of-state destination.
- Your sales invoice further documenting that the fuel was sold to an out-of-state purchaser without tax.
- Contracts of sale that cover the period of the exports.
If the invoices, bills of lading, and contracts of sale all support that a transaction is an exempt export, we generally accept the transaction as a valid export transaction. If any of the documents indicate that an export may not have taken place, additional investigation will be warranted. You are responsible for demonstrating that fuel actually was exported. In addition to the above documentation, you may be asked to obtain the following to show that you exported the fuel.
- Confirmation from the receiving state that the fuel receipt was reported and taxes were paid to them.
- Other third-party verification, such as properly completed and authenticated Arizona Fuel Manifests stamped and signed by a port inspector.
- Copies of the purchaser's tax return showing that the fuel was reported to the receiving state—subject to confirmation by the receiving state.
- Carrier delivery tickets bearing the signature of the ultimate purchaser receiving the fuel.
Instead of claiming a refund of tax for export of tax-paid fuel, you may take a credit on your Supplier of Motor Vehicle Fuel Tax Return or Supplier of Diesel Fuel Tax Return for tax-paid diesel fuel when:
- The contract of sale requires the fuel to be shipped, and
- The fuel is actually shipped to a point outside of this state by the supplier claiming the credit, by the means described above and in subdivision (a)(1) of Diesel Fuel Tax Regulation 1430, Shipments Out Of State, and Motor Vehicle Fuel Tax Regulation 1132, Shipments Out Of State.
For diesel fuel tax, if you do not take the credit on a return filed within three months of the calendar month in which export occurred, you must file a claim for refund and may not take a return credit.
For motor vehicle fuel tax, if you do not take the credit on a return filed within three months of the calendar month in which export occurred, you must file a claim for refund with the State Controller within three years from the date of purchase of the fuel.
Tax-Paid Diesel Fuel in a Diesel Particulate Filter Regeneration Process
Revenue & Taxation Code (R&TC) section 60501 (a)(4)(A) provides a refund for taxes paid on diesel fuel used for purposes other than operating motor vehicles upon the public highways in California. Diesel fuel used in the regeneration process is considered a use of diesel fuel upon the public highway and does not qualify for a refund.
Tax-Paid Biodiesel Blended with Diesel Fuel and Removed as Dyed Blended Biodiesel
In general, the Diesel Fuel Tax Law does not allow for refunds of tax paid on diesel fuel converted to dyed diesel fuel. However, R&TC section 60501(b) specifically allows for a refund for the tax that was paid on biodiesel fuel removed from an approved terminal as dyed blended biodiesel fuel, to the extent a supplier can show that the tax on that biodiesel fuel has been paid by the same supplier. Renewable diesel fuel is not biodiesel fuel.
To claim the credit, report the tax-paid biodiesel portion of the dyed blended biodiesel fuel removed on disbursement Schedule 13M, Tax-Paid Fuel Removed from a Terminal. Transactions may be summarized by day, week, or month. Report the full quantity of dyed biodiesel fuel blends on Schedule 6F, Reportable Products Removed Not Subject to Tax. Credit for tax-paid fuel removed is only available for fuel that has not previously been subject to refund or credit. Credit for terminal removals of tax-paid fuel claimed on Schedule 13M must be supported by receipts of tax-paid fuel into the same terminal. These receipts must be reported on Schedule 1A, Fuel Purchased Tax-Paid.
You must maintain records to support the gallons claimed as being the tax-paid biodiesel portion of the dyed blended biodiesel fuel. You may be asked to supply supporting documentation for your claim for refund or credit. Supporting documentation may include, but is not limited to:
- Purchase invoice(s) showing the tax-paid biodiesel.
- Proof that a dyed blended biodiesel fuel was produced, to a volume that equals or exceeds the volume necessary to support the diesel fuel tax refund.
- Records supporting the disposition of the fuel produced.
- First Taxpayer's Report; please see Exhibit A of Regulation 1435, Tax Paid Twice on Diesel Fuel on the Amount of Diesel Fuel Removed From an Approved Terminal.
You may be able to take credit for returned sales for fuel included in your taxable removals, entries, or sales that are:
- Returned to the licensed supplier by the customer to whom it was sold, and
- Delivered into a refinery or an approved terminal storage tank.
If you do not take a credit on a tax return filed within three months after the close of the calendar month in which the fuel was returned, you may file a claim for refund.
- Diesel fuel—file a claim for refund with us to recover the tax.
- Motor vehicle fuel—file a claim with the State Controller.
Farmers—Claims for Refund
Farmers must complete, sign under penalty of perjury, and submit form CDTFA-608, Certificate of Farming Use, to their vendor to purchase undyed diesel fuel without the state excise tax. You cannot file a claim for refund with us. Please see the Ultimate Vendor page for more information.