IRS issues guidance on dyed fuel refund claims
May 16, 2026
The IRS and Treasury have introduced temporary regulations regarding the recovery of federal excise tax on dyed fuel under the One Big Beautiful Bill Act.
These regulations clarify eligibility and filing procedures for taxpayers seeking refunds under Section 6435 of the tax code.
They outline the procedures a taxpayer can use to recover federal excise taxes paid on clear diesel fuel or kerosene if that person later removed the fuel from a terminal as dyed fuel for nontaxable use.
The temporary regulations also limit the claimants to taxpayers who paid the original tax to the IRS on the dyed fuel to which the claim relates. Comments on the proposed regulations are due Tuesday, June 30. Learn more.
