IRS Unveils New Path To Reclaim Fuel Taxes
The Treasury Department and IRS have introduced temporary rules allowing businesses to reclaim fuel excise taxes under specific conditions, effective May 1, 2026. The regulations provide a refund pathway for diesel or kerosene taxed and later dyed for non-taxable uses, requiring the original taxpayer to file claims using Form 8849 with Schedule 5. The guidance aims to resolve longstanding issues in the fuel supply chain but will expire in 2029 unless extended or replaced.
- ▪The new IRS rules allow refunds of excise taxes on diesel or kerosene that were taxed, dyed, and used for exempt purposes.
- ▪Only the entity that originally paid the excise tax can claim a refund under the current guidance.
- ▪Claims must be filed using Form 8849 with Schedule 5 and include a detailed taxpayer report.
- ▪The regulations are temporary, effective May 1, 2026, and set to expire on May 1, 2029.
- ▪Refunds may include amounts from the Leaking Underground Storage Tank Trust Fund.
Opening excerpt (first ~120 words) tap to expand
...By Aliss HighamUS News ReporterShareNewsweek is a Trust Project memberSee more of our trusted coverage when you search.Prefer Newsweek on Googleto see more of our trusted coverage when you search.The Treasury Department and the IRS have introduced new rules that outline how businesses can recover certain fuel taxes, offering long-awaited clarity for parts of the fuel supply chain. The regulations, effective May 1, 2026, set out a process for reclaiming taxes on diesel or kerosene that are ultimately used for purposes exempt from taxation under the One Big Beautiful Bill Act.The move addresses a gap that had left some companies unable to easily recoup taxes already paid.
…
Excerpt limited to ~120 words for fair-use compliance. The full article is at Newsweek.
Discussion
0 commentsMore from Newsweek
