Claiming Excise Tax Refunds for Your Trucks and Fuel

putting fuel in truck, federal fuel excise tax
November 7, 2023 0 Comments

Transportation and construction companies rely on fuel to conduct daily operations, and this means that these businesses pay a hefty amount of federal fuel excise tax.  

Federal excise tax on trucks is a virtually hidden tax that is simply a cost of doing business. Still these costs can increase over time, particularly for companies that utilize refrigerated trucks or need off-highway transportation. 

The good news is that if you use fuel for trucks in certain capacities, you may be due a refund that can go back three years. Additionally, this could put a good amount of funds back into your business.  

From the mechanics of fuel-related excise tax, to how to file for an excise tax refund, here’s what you need to know about how to put money back into your pocket by focusing on the fuel that your company uses every day. 

What is the Federal Excise Tax?  

A federal excise tax is a tax that is built into the cost of certain goods and services. For example, fuel, alcohol, tobacco, air travel, and additional items that may be considered luxury purchases.   

Because this tax does not show up as an extra line item or an additional charge on a receipt, the excise tax is paid automatically. It often goes unnoticed by consumers who are filling up their gas tanks or buying an airline ticket.  

In terms of fuel, as of 2023, the United States federal excise tax on gasoline is currently 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel.  

This federal excise tax on fuel is also in addition to any state or local taxes, which can vary widely depending on the region of the country. For example, as of July 2023, the state tax on both gasoline and diesel fuel in Texas was 20.0 cents per gallon. On the other hand, in New York, this excise tax was just 8.0 cents per gallon for both gasoline and diesel fuel.  

Simply put, when fuel is required every day in order to power a company’s operations, these minor amounts can accumulate and lead to hefty, although overlooked, expenses for any business. 

Who is Eligible for the Excise Tax Refund? 

When it comes to businesses that require trucks to get the job done, there are some caveats to how to qualify for an excise tax refund. Essentially, when it comes to trucks and transportation, excise tax refunds are only due for fuel that is used off the highway.  

For example, a trucking company that delivers meat and produce can’t claim the fuel required to get from Point A to Point B. However, they can claim the fuel that is needed to refrigerate the interior of the truck. A construction company can’t claim the fuel costs to arrive at a job site. But they can claim the costs for the bulldozers, backhoes, excavators, generators, graders, and other off-highway trucks used off the grid. 

A sample of businesses that are likely eligible for a fuel excise tax refund include the following: 

  • Transportation companies that require refrigerated trucks 
  • Floral companies 
  • Food trucks 
  • Construction companies 
  • Landscapers and lawn care specialists 

Keep in mind that the above list is only an example, and an expert in securing federal excise tax refunds will be able to provide more detailed advice on whether or not your distinctive business may qualify for a fuel excise tax refund. 

How to File Excise Tax Refunds 

A federal excise tax refund is under a unique area of federal tax law that can be hard to navigate simply because it is so specialized.  

Generally speaking, businesses will want to review the Internal Revenue Service’s Form 8849 to get started on their claim for a federal excise tax refund, but this is just the start of the process.  

Remember that individual states will likely have their corresponding forms for a refund. Additionally, there are ever-evolving changes to tax law when it comes to excise taxes that have to be considered before a business can file. Simply put, the best way to claim an excise tax refund is to partner with a tax specialist who focuses solely on fuel excise tax in order to get the maximum refund and avoid any hurdles or red flags along the way. 

When it Comes to Fuel Excise Tax Refunds, the Smartest First Step is to Partner with TiP Excise 

Claiming a fuel excise tax refund on a federal, state, or local level can be a complicated process, especially if a business has never claimed a refund before. This specialized corner of tax law is generally outside the scope of traditional bookkeeping and tax preparation services. Therefore, it’s better to consult with an expert in the field rather than a professional but generalized accountant. 

There can be many benefits to consulting an expert like TiP, too. For one thing, if this is the first time that your company has claimed an excise tax refund, you may be able to go back in time to claim any excise taxes paid in the past three years.  Therefore, with all the documentation, paperwork, and research required to distinguish which fuel your trucks use, you can be eligible for a refund. In addition, the process can be time-consuming and takes an owner or manager’s attention away from the all-important work to keep a business going strong. 

TiP Makes Claiming an Excise Tax Refund an Easy Venture 

You don’t have to have every receipt or documentation of where or how fuel was distributed over the past three years to get started. Instead, the expert team at TiP will simply ask a few questions, garner some initial information, and go from there to secure your business the biggest refund possible. 

There is No Cost at All to See if You are Eligible for a Refund 

The process to secure a refund with TiP Excise is simple, easy, and completely free until we’ve put the money you are owed back into your pocket.  

Reach out to our experienced team today to get the ball rolling and discover just how much you can save when the money you pay on fuel excise taxes is put into focus. 

Contact us today!