IRS Waives Diesel Fuel Penalty Due to Hurricane Katrina
IR-2005-89, Sept. 2, 2005
WASHINGTON — The Internal Revenue Service, in response to shortages of clear
diesel fuel caused by Hurricane Katrina, will not impose a tax penalty when
dyed diesel fuel is sold for use or used on the highway.
This relief applies beginning August 25, 2005, in Florida, August 30, 2005,
in Alabama, Louisiana, and Mississippi, and August 31, 2005, in the rest of
the United States, and will remain in effect through September 15, 2005.
This penalty relief is available to any person that sells or uses dyed fuel
for highway use. In the case of the operator of the vehicle in which the
dyed fuel is used, the relief is available only if the operator or the
person selling the fuel pays the tax of 24.4 cents per gallon. The IRS will
not impose penalties for failure to make semimonthly deposits of this tax.
IRS Publication 510, Excise Taxes for 2005, has information on the proper
method for reporting and paying the tax.
Ordinarily, dyed diesel fuel is not taxed, because it is sold for uses
exempt from excise tax, such as to farmers for farming purposes and to local
governments for buses.
Finally, the Internal Revenue Service will not impose the recently enacted
tax penalty on a failure to meet the requirements of EPA highway diesel fuel
sulfur content regulations if EPA has waived those requirements.
Links:
IRS Disaster Relief Page
More Information on Katrina-Related Issues
http://www.irs.gov/newsroom/article/0,,id=147221,00.html
IR-2005-89, Sept. 2, 2005
WASHINGTON — The Internal Revenue Service, in response to shortages of clear
diesel fuel caused by Hurricane Katrina, will not impose a tax penalty when
dyed diesel fuel is sold for use or used on the highway.
This relief applies beginning August 25, 2005, in Florida, August 30, 2005,
in Alabama, Louisiana, and Mississippi, and August 31, 2005, in the rest of
the United States, and will remain in effect through September 15, 2005.
This penalty relief is available to any person that sells or uses dyed fuel
for highway use. In the case of the operator of the vehicle in which the
dyed fuel is used, the relief is available only if the operator or the
person selling the fuel pays the tax of 24.4 cents per gallon. The IRS will
not impose penalties for failure to make semimonthly deposits of this tax.
IRS Publication 510, Excise Taxes for 2005, has information on the proper
method for reporting and paying the tax.
Ordinarily, dyed diesel fuel is not taxed, because it is sold for uses
exempt from excise tax, such as to farmers for farming purposes and to local
governments for buses.
Finally, the Internal Revenue Service will not impose the recently enacted
tax penalty on a failure to meet the requirements of EPA highway diesel fuel
sulfur content regulations if EPA has waived those requirements.
Links:
IRS Disaster Relief Page
More Information on Katrina-Related Issues
http://www.irs.gov/newsroom/article/0,,id=147221,00.html