Utah State Tax Commission

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International Fuel Tax Agreement (IFTA)/Utah Special Fuel User

Special Fuel Tax

Special fuel tax is paid by licensed special fuel suppliers on undyed special fuel when it is removed from the rack or otherwise imported into Utah. The licensed supplier then includes the tax in the sales price charged to its customers. Thus, the tax paid by users at the pump or on other invoiced purchases is actually a reimbursement for tax previously assessed.

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Bulk Fuel Storage

In Utah, the fuel tax should be charged on clear fuel at the time of purchase (when delivered or invoiced by the supplier). Sales tax will be charged on dyed fuel, unless you qualify for and have completed a sales tax exemption certificate, Form TC-721 and given it to your supplier.

Records must distinguish between fuel used in qualified vehicles and fuel used for other purposes. Special fuel that is exempt from fuel tax (non-highway, PTO, and etc.) is subject to sales and use tax in Utah. To obtain credit for fuel tax paid on fuel which is subject to sales/use tax use forms:

• TC-922A, Schedule A, Sales Tax Due on Undyed Diesel Fuel and;
• TC-922B, Credit for Tax Reported on Exempt Fuel for Utah-Based Carriers

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Dyed Diesel Fuel

Dyed diesel fuel which is used for purposes other than to operate a motor vehicle upon the public highways of the state is not subject to the special fuel tax. However, the dyed fuel is subject to sales and use tax. The user of the fuel must prove to the Tax Commission that the special fuel was used for purposes other to operate a motor vehicle upon the public highways or the state.

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Undyed Diesel Fuel

Special fuel tax is generally included in the purchase price at the retail level. Exempt users must request a refund for tax paid on undyed diesel fuel for:

• Special fuel sold that is to the U.S. government, the State of Utah, or any instrumentality or political subdivision of the state. Taxes are paid and refunded on a quarterly basis. Requests for refunds of taxes paid are made by submitting one of the following forms:
  • Application for Government Special Fuel Tax Refund, Form TC-114S. This form is used to request a refund of taxes paid on undyed diesel fuel.
  • Application for Government Motor Fuel Tax Refund, Form TC-114M. This form is used to request a refund of taxes paid on motor fuel (gasoline).
• Fuel used in manufacturing that is limited to an exempt process approved by the Division of Air Quality, under Title 19, Chapter 2, Air Conservation Act, and for use in machinery and equipment meeting the Clean Air Standards Act. the Division of Air Quality will issue a certificate of exemption. Purchasers must present a copy of the exempt ion certificate at the time of purchase from the rack or refinery. If fuel is purchased from a supplier, the tax is already paid. To claim a refund of taxes paid, file a Form TC-942, Application for Undyed Diesel Fuel Tax Refund.
• Fuel that is exported from this state if proof of actual exportation is made within 180 days after exportation. This is reported on Form TC-112, Proof of Exportation for Motor Fuel, Undyed Diesel or Other Petroleum Products.
• Fuel that is used for off-highway agricultural purposes. Credit is claimed on the Utah Individual Income Tax Return, Form TC-40, the Fiduciary Form TC-41, or the Corporate Franchise or Income Tax Return, Form TC-20. If a taxpayer is not required to file a corporate or individual income tax return, use Form TC-519 Application For Nonprofit Agricultural Fuel Refund (Taxpayers can only submit one claim per year).
• Undyed diesel fuel that is used in a vehicle off-highway, or to operate a power take off unit.

In all cases, except fuel exported out of the state, the purchaser shall pay the tax and apply for a quarterly refund using one of these forms.

• IFTA/Special Fuel User filers will complete the IFTA Form TC-922B to receive credit.
• Application for Undyed Diesel Fuel Tax Refund, Form TC-942. This form is used by non-IFTA/Special Fuel User tax accounts.

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Idle Time

Idle time falls within the meaning of operating a vehicle on public highways. Fuel used for purposes such as idling to run heating, air conditioning, or other accessories is taxable.

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