Can concrete mixer truck operators claim a Kansas motor fuel tax refund for non-highway fuel use?

Plain-English summary

Kansas Notice 18-01 explains how operators of concrete mixer trucks can get a refund of motor fuel tax on the fuel those trucks burn for non-highway purposes -- for example, fuel used to run a power take-off or turn the mixer drum.

The existing law. Kansas already refunds motor fuel tax on fuel used off the public highways. K.S.A. 79-3453 lets a person who uses motor-vehicle fuels or special fuels on which the tax was paid "for any purpose other than operating motor vehicles on the public highways" claim a refund, as long as the refund exceeds $25.

The 25% safe harbor. The Department determined that a person who operates a truck designed, equipped, and used exclusively for concrete mixing and delivery may claim a refund of 25% of the fuel used in the truck without conducting a fuel-usage study, effective for fuel purchased on or after July 1, 2018.

Two requirements. To claim it you must (1) hold a valid motor fuel refund permit -- if you don't already have one, file form MF-51 (Application for Motor Vehicle / Special Fuel Tax Refund Permit) and form MF-112 (Agreement to Maintain Motor Fuel Refund Records) with a $6.00 fee -- and (2) account for and keep records of the gallons of fuel disbursed into and used by each mixer truck (K.S.A. 79-3456).

Claiming more than 25%. To claim a percentage higher than 25%, you must prove it with a study approved by the Department, or provide electronic (ECM) documentation measuring the fuel used for non-highway purposes, which the Department will accept in lieu of the study.

What this means for you

Concrete/ready-mix operators

• If your truck is used exclusively for concrete mixing and delivery, you can claim a flat 25% refund of the motor fuel tax on that truck's fuel without a usage study, for fuel bought on or after July 1, 2018.
• You must first hold a motor fuel refund permit and keep gallon records for each truck.

Operators seeking a larger refund

• A refund above 25% requires a Department-approved study, or ECM data measuring non-highway fuel use.

New refund claimants

• Apply for the permit with forms MF-51 and MF-112 and a $6.00 fee before filing a claim; the Department sends your first claim form once the application is approved.

Common questions

How much can I get back without a study? 25% of the fuel used in a qualifying concrete mixer truck.

When does it apply from? Fuel purchased on or after July 1, 2018.

What do I need before claiming? A valid motor fuel refund permit (forms MF-51 and MF-112, $6.00 fee) and records of gallons used by each truck.

Can I claim more than 25%? Yes, but only with a Department-approved study or ECM documentation proving the higher non-highway percentage.

Citations and references

• K.S.A. 79-3453 -- refund of motor fuel tax on fuel used for purposes other than operating vehicles on public highways; refund must exceed $25.
• K.S.A. 79-3456 -- invoice and recordkeeping requirements supporting a refund claim.
• 25% flat refund, effective for fuel purchased on or after July 1, 2018, for trucks used exclusively for concrete mixing and delivery, with no study required.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: Notice 18-01

Original ruling text

TAX POLICY DEPARTMENT OF REVENUE
109 SW 9th STREET PHONE: 785-368-8222
PO BOX 3506 FAX: 785-296-7928
TOPEKA, KS 66601-3506 www.ksrevenue.org
GOVERNOR JEFF COLYER, M.D.
SAMUEL M. WILLIAMS, SECRETARY

                                         NOTICE 18-01

          REFUND OF TAX ON MOTOR FUEL USED IN CONCRETE MIXER TRUCKS
                                (JULY 1, 2018)

   Advice has been requested regarding the taxation of motor fuel used in concrete mixer trucks

for non-highway purposes. Specifically, the question concerns whether fuel used to operate a
power take-off or the mixer drum is exempt from motor fuel tax.

    Kansas law provides for the refund of certain tax paid on motor-vehicle fuels or special fuels

not used on highways.

    K.S.A. 79-3453. Any person who uses any motor-vehicle fuels or special fuels on
    which the motor-fuel or special fuel tax has been paid for use in school buses or for any
    purpose other than operating motor vehicles on the public highways, such person shall
    be entitled to be refunded the tax paid upon complying with the requirements of this
    act. Such person shall not be entitled to a refund of such tax unless the amount of the
    refund exceeds $25. The words "licensed distributor," as used in this act, shall also
    include a licensed importer.

    K.S.A. 79-3456. Invoice by licensed distributors or retailers; contents; copies. (a) At
    the time of making each delivery of motor-vehicle fuel or special fuel upon which a
    refund of the tax may be claimed, the licensed distributor or licensed retailer delivering
    the same shall make out an invoice which shall contain a serial number which shall not
    be repeated through any one calendar year, and which shall state the following:
      (1) The name of the distributor or retailer (printed or rubber stamped) selling the
          refund motor fuel;
      (2) the name of the purchaser;
      (3) the number of gallons of motor-vehicle fuel containing less than 10% agricultural
          ethyl alcohol thus purchased and delivered;
      (4) the number of gallons of motor-vehicle fuels containing 10% or more of
          agricultural ethyl alcohol thus purchased and delivered;
      (5) the date and place of delivery;
      (6) the number of gallons of special fuel purchased and delivered; and
      (7) the price paid for such motor-vehicle fuel or special fuel.
    (b) The invoice prepared by a distributor or retailer shall be made out in triplicate
    unless the invoice is generated by automated procedures approved by the director. One
    copy of each invoice made out in triplicate shall be delivered to the purchaser at the
    time of purchase. Upon receiving payment in full for such motor-vehicle fuel or special
    fuel the distributor or retailer shall receipt for payment on the original invoices. A

 duplicate shall be retained by the distributor or retailer for a period of three years and
 shall be subject to examination by the director. Carbon or contact-type paper shall be
 used in making the first and second duplicate invoices unless the invoice is generated
 by automated procedures approved by the director
 (c) Invoices generated by automated procedures approved by the director shall be made
 out in duplicate. The original of each such invoice shall be delivered to the purchaser
 and upon receiving payment for such motor-vehicle fuel or special fuel the distributor
 or retailer shall receipt for payment on another original invoice. Duplicates of all such
 invoices shall be retained by the distributor or retailer for a period of three years.
 (d) If the invoice of any distributor or retailer is not printed in triplicate or does not
 meet the requirements of this section then such distributor or retailer shall use the
 uniform invoice prepared and furnished free of cost by the director as provided in this
 act.

  The Department of Revenue has determined that a person who operates a truck designed,

equipped, and used exclusively for concrete mixing and delivery may claim a refund of 25% of
the fuel used in the truck, without the need to conduct a study of fuel usage, effective for fuel
purchased on or after July 1, 2018. There are two requirements that must be met in order to make
such a claim.

  First, the person making the claim must have a valid motor fuel refund permit. If the person

does not already have a permit, forms may be obtained from our website: www.ksrevenue.org.
Print a copy of form MF-51, Application for Motor Vehicle / Special Fuel Tax Refund Permit, and
a copy of form MF-112, Agreement to Maintain Motor Fuel Refund Records. Complete both
forms and mail them, along with a $6.00 fee, to:

 Kansas Department of Revenue
 Motor Fuel Tax
 P. O. Box 750680
 Topeka, KS 66675

  Second, upon receipt, the Department will review the Application and Agreement. If

approved, your first claim form will be sent to you. The claim form and supporting documents
(K.S.A. 79-3456) can now be submitted for review. The Department will then review the claim
and determine the amount of refund. Claimants must account for and keep records of the number
of gallons of fuel disbursed into and used by each concrete mixer truck.

 Subsequent claims should be submitted as instructed by the Department.

  If a person wants to claim a percentage higher than 25% of fuel disbursements into a mixer

truck, a study may be required to prove the higher percentage. The type and manner of the study
must be approved by the Kansas Department of Revenue. If the concrete mixer truck is equipped
with the electronic capability (ECM) to measure the fuel used for non-highway purposes, the
Department will accept that documentation in lieu of the study.

                               Taxpayer Assistance

Additional copies of this notice, forms or publications are available from our web site,
www.ksrevenue.org. If you have questions about this Notice, please contact:

                           Taxpayer Assistance Center
                          Kansas Department of Revenue
                            Topeka, KS 66612-1588
                              Phone: 785-368-8222
                               Fax: 785-296-2703