Tax 4.10 Tax 4.10 Motor vehicle fuel tax liability.

Tax 4.10(1) (1) Purpose. This section clarifies the tax liability on all sales of motor vehicle fuel produced, refined, blended, manufactured or imported into Wisconsin.

Tax 4.10(2) (2) Definition. In this section, “position holder” has the meaning specified in the federal internal revenue service regulations, 26 CFR 48.4081-1 (m).

Tax 4.10(3) (3) Imposition. The tax on all motor vehicle fuel, either gasoline or undyed diesel fuel, shall be paid to the department by suppliers required to be licensed with the department, as follows:

Tax 4.10(3)(a) (a) Fuel withdrawn from a Wisconsin marine terminal or pipeline terminal. The motor vehicle fuel tax on gasoline and undyed diesel fuel withdrawn from a Wisconsin marine terminal or pipeline terminal shall be paid by the position holder.

Tax 4.10(3)(b) (b) Imported fuel. Gasoline and undyed diesel fuel imported into Wisconsin is subject to the motor vehicle fuel tax and shall be paid by the supplier when either of the following conditions applies:

Tax 4.10(3)(b)1. 1. The product is placed into a transport truck whose destination is a Wisconsin location other than a pipeline terminal or refinery. The bill of lading prepared by the out-of-state terminal operator shall clearly indicate Wisconsin as the destination state. The tax shall be paid by the position holder at the out-of-state terminal.

Tax 4.10(3)(b)2. 2. The product is transported across the state line by a supplier from an out-of-state bulk plant in a transporting vehicle. The sales invoice shall clearly indicate Wisconsin as the destination state and that the tax shall be paid by the supplier.

Tax 4.10(3)(c) (c) Blending components. Any product that is not a motor vehicle fuel and is blended as a component part of motor vehicle fuel other than at a refinery, marine terminal, pipeline terminal or place of manufacture is subject to tax at the time and place of blending. The tax on the component part shall be paid by the person who owns the motor vehicle fuel when blending is completed.

Tax 4.10 Note Note: This section interprets s. 78.07, Stats.

Tax 4.10 History History: Emerg. cr. eff. 4-1-94; cr. Register, November, 1994, No. 467, eff. 12-1-94; CR 16-064: am. (3) (b) 2. Register January 2018 No. 745, eff. 2-1-18.

Tax 4.11 Tax 4.11 Tax exemption for dyed diesel fuel.

Tax 4.11(1) (1) Purpose. This section clarifies the tax exemption provided to suppliers required to be licensed by the department when a dye has been added to diesel fuel.

Tax 4.11(2) (2) General.

Tax 4.11(2)(a) (a) All fuel dyed in accordance with the federal internal revenue service temporary regulations, 26 CFR 48.4082-1T, 2T, 3T and 4T, is treated as destined for exempt use and is exempt from the motor vehicle fuel tax.

Tax 4.11(2)(b) (b) Dyed diesel fuel shall only be used for exempt purposes.

Tax 4.11 Note Examples: 1) Diesel fuel used as heating oil has an exempt purpose.

Tax 4.11 Note 2) Diesel fuel used for nonhighway use has an exempt purpose.

Tax 4.11 Note 3) Diesel fuel used in trains has an exempt purpose.

Tax 4.11 Note Note: This section interprets s. 78.01 (2p), Stats.

Tax 4.11 History History: Emerg. cr. eff. 4-1-94; cr. Register, November, 1994, No. 467, eff. 12-1-94.

Tax 4.12 Tax 4.12 Uncollected motor vehicle fuel taxes and repossessions.

Tax 4.12(1) (1) Purpose. This section clarifies when and how a supplier required to be licensed by the department may recover the motor vehicle fuel tax from the department when a purchaser is unable to pay the tax to the supplier. This section also clarifies when and how a wholesaler distributor may recover the motor vehicle fuel tax from the department when the wholesaler distributor is unable to collect the tax from another wholesaler distributor or a retail dealer.

Tax 4.12(2) (2) Statutes. Under s. 78.01 (2s), Stats., a supplier is not liable for the tax on motor vehicle fuel when the supplier is unable to recover the tax from a purchaser. With proper documentation, the supplier may claim a tax deduction on a later remittance of taxes. A wholesaler distributor may file a refund claim with the department to recover the tax on uncollectable accounts covering sales to other wholesaler distributors and retail dealers.

Tax 4.12(3) (3) Procedure.

Tax 4.12(3)(a) (a) Tax imposed. A supplier shall pay the motor vehicle fuel tax to the department by the 15th day of the month after the month in which the fuel is received, as described in s. 78.07, Stats., irrespective of whether the sale is for cash or credit.

Tax 4.12(3)(b) (b) Bad debts.

Tax 4.12(3)(b)1. 1. ‘Deduction from measure of tax.’ A supplier is relieved from the liability for motor vehicle fuel tax on accounts which have become worthless and which have met the requirements to be charged off for income or franchise tax purposes. The bad debt tax deduction shall be reported and claimed on the supplier’s monthly tax report for the month in which the account becomes worthless. However, if a supplier is out of business when the account becomes worthless, a bad debt deduction may be claimed on the last return filed by that business or through a refund claim filed with the department. A wholesaler distributor may claim a bad debt tax deduction for the amount of tax liability for motor vehicle fuel tax on sales to other wholesaler distributors or retail dealers on accounts which have become worthless and which have met the requirements to be charged off for income or franchise tax purposes by filing a refund claim with the department. A claim for refund relating to a worthless account must be filed within 4 years of the 15th day of the 4th month following the close of the supplier’s or wholesaler distributor’s calendar or fiscal year within which the account becomes worthless.

Tax 4.12 Note Examples: 1) An account of a supplier who is still in business becomes worthless and meets the requirements to be charged off for income or franchise tax purposes on January 10, 2011. The supplier may claim a bad debt deduction on the motor vehicle fuel tax return, form MF-002, filed for the month of January 2011, even though the bad debt deduction may not be claimed for income or franchise tax purposes until the 2011 income or franchise tax return is filed in 2012.