Frequently Asked Questions About Motor Fuel
- IFTA/Interstate - $13 for a 24-hour motor fuel permit and $25 for a 72-hour motor fuel permit. Motor fuel permits may be purchased in multiples of three upon making proper application and payment of the required fees. The permits can be obtained at the ports of entry or by calling the Central Permit Office, 785-368-6501.
- LFCL - Licensed liquid fuel carriers can purchase a $5 trip permit for new vehicles or for an extra/substitute vehicle used temporarily or for emergency purposes. A non-licensed carrier may obtain a trip permit for vehicles that enter the state on an occasional trip or are in temporary service.
Am I required to file on the forms that are issued by the Revenue Department or are computer-generated forms acceptable?
- Distributors require a $1,000 minimum or three months average tax liability which ever is greater
- Importer or Exporters require a $5,000 minimum or three months average tax liability which ever is greater
- Manufacturers require a $5,000 minimum or three months average tax liability which ever is greater
Motor Fuel Tax
When filing an application (MF-42) for a motor fuel distributor’s license, what additional documents are required?
Are cities, townships, counties, schools and state governments required to pay motor fuel, special fuel and Liquified Petroleum taxes?
Racing Fuel would clearly fit within the definition of “special fuels,” set forth at K.S.A. 79-3401(s) and also appears to fit within the definition of “motor vehicle fuels,” set forth at K.S.A. 79-3401(l). Racing Fuel would be subject to the motor vehicle fuel tax imposed under K.S.A. 2000 Supp. 79-3408 et seq., to be paid by the supplier or the distributor.
In accordance with K.A.R. 92-3-20, the end-user or consumer (not the supplier or distributor) of the Racing Fuel may claim a refund from the Department of motor vehicle fuel tax on fuel properly documented and substantiated as consumed in non-highway use.
All retailers, and base exchanges and commissaries, must collect Kansas motor vehicle fuel taxes on fuel sales made on Federal areas located within Kansas.
Congress has waived the sovereign immunity of the United States in regard to collection of state motor vehicle fuel taxes on sales made on federal areas. The only exception is fuel sold to the federal government. The law requires the officer in charge of a military base to submit monthly reports showing the amount of taxable motor vehicle fuels sold on base.
Title 4 U.S.C.A., Section 104 states:
(a) All taxes levied by any State, Territory, or the District of Columbia upon, with respect to, or measured by, sales, purchases, storage, or use of gasoline or other motor vehicle fuels may be levied, in the same manner and to the same extent, with respect to such fuels when sold by or through post exchanges, ship stores, ship service stores, commissaries, filling stations, licensed traders, and other similar agencies, located on United States military or other reservations, when such fuels are not for the exclusive use of the United States. Such taxes, so levied, shall be paid to the proper taxing authorities of the State, Territory, or the District of Columbia, within whose borders the reservation affected may be located.
(b) The officer in charge of such reservation shall, on or before the fifteenth day of each month, submit a written statement to the proper taxing authorities of the State, Territory, or the District of Columbia within whose borders the reservation is located, showing the amount of such motor fuel with respect to which taxes are payable under subsection (a) for the preceding month. . . .
Motor Fuel Refund
If I travel the Kansas Turnpike and pay the toll charges, do I also have to pay motor fuel taxes? Can I obtain a refund of motor fuel taxes paid?
If motor fuel is burned in motor vehicles subject to motor fuel tax during highway construction, reconstruction or repair, is it eligible for a refund of motor fuel taxes paid?
If motor fuel is used in a vehicle registered for highway use with the Kansas Department of Revenue, but is used for non-highway purposes only, is it eligible for a refund of motor fuel taxes paid?
Power Take-Off Information
Should motor fuel tax be refunded for motor fuel consumed in operating an air-conditioner compressor on a motor vehicle?
No. While some states impose motor fuel tax on fuel used to propel motor vehicles on state highways, Kansas imposes the tax on fuel used in motor vehicle operations on state highways. Fuel used to run a compressor that operates as part of an air conditioning or climate control system is fuel used in the motor vehicle's operations on Kansas highways within the meaning of the motor fuel imposition and refund statutes.
The Kansas motor fuel use tax is imposed on "motor fuel used in operations on highways within this state by such interstate motor fuel user." See K.S.A. 79-34,109(a). ;Safe highway operation requires alternators, generators, air-conditioner compressors, hydraulic pumps for power steering and brakes, fuel-injection pumps, and other similar equipment to be operated to defog windows, provide for driver and passenger comfort, allow for reasonable steering effort, provide for lights and braking, clear windshields, provide needed engine power, and so forth. The fuel use attributable to powering this equipment is "motor fuel used in operations on highways within this state" even though the fuel is not used to propel a vehicle down the road. None of the tax paid on fuel consumed to run this equipment is subject to refund as having been purchased for a purpose "other than operating motor vehicles on public highways." See K.S.A. 79-3453; Q & A on Motor Fuel User Idle Time Refunds.
Taxpayers may apply for a refund through the motor fuel refund section if records are included to support the amount of fuel being claimed for a refund.
A legitimate record is determined through a system that measures actual PTO usage including, but not limited to, a test period of operations to calculate the amount of fuel used by the PTO. Flat percentages may be allowed and reported when the adopted system is based on percentages arrived at during the test period. Once a system has been accepted, the carrier may claim credits for PTO usage from that time forward. Credits will not apply to previous periods.
Idle Time Information
Is an interstate motor fuel user entitled to any refund under K.S.A. 79-3454 for taxes paid on fuel consumed while its vehicles are stopped and idling off-highway in Kansas? Are refunds permitted under K.S.A. 79-3453 when all of the fuel use tax reported under K.S.A. 79-34,109(a) was for fuel "used in [an interstate motor fuel user's] operations … on highways within this state"?
No to both questions. Motor carriers pay fuel tax at the pump (or on the purchase of fuel in bulk), but they also pay fuel use tax to each state based on how much fuel they consume in their travels in the state. This is done through quarterly IFTA tax reports that detail the distance a carrier traveled in a state, the amount of fuel it purchased in the state tax-paid, and the overall miles-per-gallon of its fleet. From this the carrier calculates the fuel it used in the state and takes credit for any state fuel tax it paid on fuel purchases during the quarter. It then pays the state any additional tax owed or receives a credit if tax was overpaid. The fuel use tax is largely a mechanism for redistributing fuel tax to compensate for carriers' differential fueling among states, caused by patterns in freight movement, and for differences in state tax rates.
The amount of tax paid to Kansas on idle time fuel consumed in Kansas while stopped cannot be determined by using the mileage formula in K.S.A. 79-34,109(a) and the details on an IFTA quarterly report alone. This formula does not contemplate making any adjustments to the tax being reported because of idle time fuel consumption.
K.S.A. 79-34,109(a) codifies a mileage formula that determines the taxable "[n]umber of gallons used in the [interstate motor carrier's] operations … on highways within this state." Since the formula is a legal construct that establishes the taxable number of gallons used in a carrier's Kansas highway operations, none of the fuel use tax accounted for by a carrier can qualify for refund as having been paid for some purpose "other than operating motor vehicles on the public highways" under K.S.A. 79-3453.
Discussion: In 1994, Congress enacted legislation mandating that, after Sept. 30, 1996, states may enforce their motor fuel use reporting requirements only if those requirements conform to the International Fuel Tax Agreement [IFTA]. 49 USC Sec. 31705 (2000). The goal of IFTA is the uniform administration of motor fuel tax reporting by motor carriers that operate in the United States and Canada. See IFTA Article I(B). While IFTA's goal is uniform reporting, each member jurisdiction determines the rates, coverage, and exemptions for the tax on motor fuel use by interstate and international motor carriers. See IFTA Article IIIA. Kansas entered into the agreement in 1992. IFTA's uniform reporting requirements govern the reporting of Kansas motor fuel use by interstate motor carriers that operate in Kansas. See K.S.A. 79-34,165. This fuel use is taxed at K.S.A. 79-34,109(a): There is hereby imposed on each interstate motor fuel user a tax on motor fuel used in operations on highways within this state by such interstate motor fuel user. . . . The number of gallons of motor fuel used in the operations of any interstate motor fuel user on highways within this state shall be deemed to be such proportion of the total number of gallons of such motor fuel used in its entire operations within and without this state, as the number of miles traveled on highways within this state bears to the total number of miles traveled within and without this state. (Underlining provided.)
This statute codifies a formula that determines the taxable "number of gallons of motor fuel used in the operations of any interstate motor fuel user on highways within this state." Fuel consumed while a vehicle is stopped and idling does not affect the amount of fuel reported under the formula. This is because mileage determines the taxable gallons of fuel use. Mileage does not change when a vehicle is stopped and idling, wherever the idling occurs. Consequently, the taxable fuel use being reported does not change because of fuel consumed while idling.
Under the formula, any allowance for an interstate motor carrier's off highway use in Kansas must be based on the number of miles that the carrier travels off-highway in Kansas. When a carrier determines the ratio of Kansas highway miles to the total miles traveled within and without the state, the off-highway Kansas miles can be included as part of the ratio's denominator to reduce the number of taxable Kansas gallons being reported.
The mileage formula is a legal construct that provides interstate motor carriers with a uniform method for reporting their taxable fuel use. The construct establishes "[t]he number of gallons of motor fuel used in the operations of any interstate motor fuel user on highways within this state." Accordingly, any change to the taxable result must come from changes to the number of Kansas highway miles, the number of total miles, or the number of gallons that are entered in the formula. The formula's result is not changed by the fact that an interstate motor carrier may have consumed fuel while stopped and idling off-highway in Kansas. These gallons are already included in the formula as part of the "total number of gallons of … motor fuel used in [the interstate motor carrier's] entire operations within and without this state."
K.S.A. 79-3453 through K.S.A. 79-3464 deal with motor fuel refunds. K.S.A. 79-3453 extends the refund entitlement: Any person who uses any motor-vehicle fuels or special fuels on which the motor-fuel or special fuel tax has been paid . . . 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 . . . . (Underlining added). K.S.A. 79-3453.
K.S.A. 79-3454 requires that before a refund claim is made, each person who wants to be eligible for a refund must apply for a refund permit. The applicant is required to list "the uses to which the applicant intends to put such motor-vehicle fuel or special fuel upon which a refund will be claimed." If the fuel use is for farming, manufacturing, or industrial processing, the applicant must support the claim with additional information, such as the number of acres under cultivation, or the nature and kind of the manufacturing or industrial processing. Any incidental highway use of farm equipment and other motor vehicles that are "primarily designed or operated for non-highway use" is not taxed. K.S.A. 79-3463.
K.S.A. 79-3454 shows that taxes paid on fuel used in farming, manufacturing, and industrial processing qualify as having been paid for purposes "other than operating motor vehicles on the public highway." This is not the case with fuel that interstate motor carriers use for their carrier operations. K.S.A. 79-34,109(a) establishes the "[n]umber of gallons used in the [interstate motor carrier's] operations … on highways within this state." Thus, all of the fuel use tax that a carrier reports and pays under K.S.A. 79-34,109(a) is for the carrier's "operations … on highways within this state." None of this fuel use tax is subject to refund as having been paid for some purpose "other than operating motor vehicles on the public highways" under K.S.A. 79-3453.
Idling while stopped occurs both on highway as well as off highway. Idling on a highway occurs at stop lights, at interstate rest stops, at toll booths, while vehicles are stopped in traffic, along the side of the road, and at other similar locations. Idling off highway can occur at a warehouse, motel, restaurant, or similar location. The IFTA reporting formula is based on average miles per gallon, not on how much fuel use tax was remitted to the State of Kansas on fuel consumed during the time spent idling on-highway or off-highway.
Motor Fuel Retailer
Department of Agriculture
Division of Weights & Measures
1320 Research Park Drive
Manhattan, KS 66502
Department of Health & Environment
1000 Jackson St, Ste. 410
Topeka, KS 66612-1367
International Fuel Tax Agreement (IFTA)
The purpose of this Agreement is to promote and encourage the fullest and most efficient possible use of the highway system by making uniform the administration of motor fuels use taxation laws with respect to motor vehicles operated in multiple member jurisdictions.
Enable participating jurisdictions to act cooperatively and provide mutual assistance in the administration and collection of motor fuels use taxes.
Establish and maintain the concept of one fuel use license and administering base jurisdiction for each licensee and to provide that a licensee's base jurisdiction will be the administrator of this Agreement and execute all its provisions with respect to such licensee.
States collect taxes on the motor fuel used within their borders to build and maintain the roads and highways that link their communities to each other and the rest of the nation. As an interstate motor carrier traveling in Kansas, you pay your share of these taxes according to the provisions of the International Fuel Tax Agreement (IFTA). This agreement, recognized by 58 states and provinces, simplifies the way you report and pay fuel taxes, reduces paperwork and minimizes compliance requirements.
Specifically, Kansas participation in IFTA means that:
- A single fuel tax license authorizes you to travel in all IFTA member jurisdictions;
- A single tax return fulfills your reporting requirements for all member jurisdictions;
- A single state usually performs your fuel tax audit.
The following jurisdictions are current IFTA members:
|Current IFTA Members|
|Alabama||Kansas||New Hampshire||Rhode Island|
|Arizona||Louisiana||New Mexico||South Carolina|
|Arkansas||Maine||New York||South Dakota|
|Indiana||Nevada||Prince Edward Island|
Any person based in a member jurisdiction operating a qualified motor vehicle(s) in two or more member jurisdictions.
Qualified Motor Vehicle means a motor vehicle used, designed, or maintained for transportation of persons or property and:
- Having two axles and a gross vehicle weight or registered gross vehicle weight exceeding 26,000 pounds or 11,797 kilograms; or
- Having three or more axles regardless of weight; or,
- Is used in combination, when the weight of such combination
exceeds 26,000 pounds or 11,797 kilograms gross vehicle or registered
gross vehicle weight.
Qualified Motor Vehicle does not include recreational vehicles.
(Recreational vehicles such as motor homes, pickup trucks with attached campers, and buses when used exclusively for personal pleasure by an individual. In order to qualify as a recreational vehicle, the vehicle shall not be used in connection with any business endeavor.)
The member jurisdiction where the qualified motor vehicles are based for vehicle registration purposes and
- Where the operational control and operational records of the licensee’s qualified motor vehicles are maintained or can be made available; and
- Where some travel is accrued by qualified motor vehicles within the fleet.
The commissioners of two or more affected jurisdictions may allow a person to consolidate several fleets that would otherwise be based in two or more jurisdictions.
If you have fleets in more than one jurisdiction and want more information on consolidating your fleets under one base jurisdiction call the Kansas Department of Revenue IFTA section.
“Base Jurisdiction,” establishes the jurisdiction to which a carrier will make fuel tax payments. Your base jurisdiction will then distribute the appropriate amount of tax owed to each IFTA member jurisdiction for you.
Kansas will be your base jurisdiction if:
- You have IFTA qualified vehicle(s) registered in Kansas;
- Your vehicle(s) use is controlled from a physical location in Kansas;
- Your vehicle(s) records are maintained or can be made available at a physical location in Kansas; and
- At least one of your vehicles travels some miles within Kansas.
If I do not have an IFTA license and have a qualified motor vehicle traveling through a member jurisdiction what do I need to do?
Kansas will issue a 30-day IFTA temporary permit valid for all member jurisdictions to carry in lieu of displaying the annual decals. A temporary decal permit will only be issued to a licensee in good standing. It will be vehicle specific, and you are only allowed one per vehicle. You will need to make sure you have a copy of your IFTA license in the vehicle along with this temporary decal permit.
You will need to purchase an additional decal before your 30-day temporary permit expires. Additional permits can be ordered at www.Truckingks.org.
The licensee shall file a calendar quarterly return with the base jurisdiction and shall pay all taxes due and included with the return. Tax returns are required even if no operations were conducted or no taxable fuel was used during the reporting period.
Tax Return, and full payment of taxes, shall be due on the last day of the month following the close of the reporting period for which the return is due. If the last day of the month falls on a Saturday, Sunday, or legal holiday, the next business day shall be considered the final filing date.
IFTA Return Due Dates
Jan. through March: April 30th
April through June: July 31st
July through Sept.: Oct. 31st
Oct. through Dec.: Jan. 31st
Penalty will be assessed when failing to file a return, filing a late return, or underpaying taxes due.
Interest shall be assessed at the rate of one (1) percent per month, on all delinquent taxes due to each jurisdiction.
You may request a refund of your credit balances of $10 or more by checking the box on the front of your IFTA return form 85. If the box is not marked, the credit balance will be applied to your next return. Credit balances cannot be carried for more than eight quarters (two years) from the date established.
Your IFTA license may be revoked for any of the following reasons:
- Failure to file a quarterly IFTA report;
- Failure to pay tax due to all member jurisdictions;
- Failure to adhere to record-keeping requirements, and;
- Failure to pay or appeal an audit assessment within the established time period;
- Failure to post a bond when required; and
- Failure to remit payment to cover insufficient funds.
To reinstate your IFTA license after being revoked you must:
- Pay all taxes in full;
- File all required reports;
- Submit any records requested;
- File a new application;
- Pay registration fee ($10 for the 1st set of decals and $1 for each additional set); and
- Post a bond to cover 3 quarters tax liability but not less than $1,000.
Is there anything I need to do for IFTA if I go out of business or no longer leave the State of Kansas?
Yes, you may cancel your IFTA license at any time, provided all reporting requirements and tax liabilities to all member jurisdictions have been satisfied. To surrender your license you need to sign and date the bottom of the license and mark the quarter you want the license surrendered. You must remove the IFTA decals from vehicles, and return the license, all unused decals, and any part of the decals that have been removed from the vehicles to the Kansas Department of Revenue IFTA office. A final audit may be conducted by any member jurisdiction upon cancellation. The records must be retained for four years after the due date of the final quarterly tax report.
If your license was misplaced or destroyed, you will need to submit a statement of what has happened to the license and decals. Include your name and phone number so the IFTA office may contact you if there is any additional information needed.
Yes, the required elements include:
- START and END date of trip;
- Trip origin and destination;
When a trip includes more than one stop, (multiple destinations) the added stops should also be recorded;
- Route of travel;
- Beginning and ending odometer readings;
Total trip miles - IFTA and IRP require reporting all miles the unit travels;
- Total miles must include loaded and deadhead miles, and any local miles when the unit is taken for servicing.
- Miles in each jurisdiction;
- Unit number or vin;
- Fleet number;
- Registrant’s name.
In addition, IFTA specifies the records MUST include distance data on each vehicle for each trip and be included in monthly fleet summaries.
Regardless of the mileage documentation form used, it must include all of the elements listed above.
An acceptable receipt or invoice must include, but shall not be limited to the following:
- Date of purchase;
- Seller’s name and address;
- Number of gallons or liters purchased;
- Fuel type;
- Price per gallon or liter or total amount of sale;
- Unit numbers.
Purchaser’s name (in case of a lessee/lessor agreement, receipts will be accepted in either name, provided a legal connection can be made to the reporting party.)
See the following information from the IFTA Proceedures Manual.
OPTIONAL USE FOR FUEL TAX REPORTING
On-board recording devices, vehicle tracking systems, or other electronic data recording systems may be used (at the option of the carrier) in lieu of or in addition to handwritten trip reports for tax reporting. Other equipment monitoring devices that transmit data or may be interrogated as to vehicle location or travel may be used to supplement or verify handwritten or electronically-generated trip reports.
Any device or electronic system used in conjunction with a device shall meet the requirements stated in this Section.
On-board recording or vehicle tracking devices may be used in conjunction with manual systems or in conjunction with computer systems.
DEVICES USED WITH MANUAL SYSTEMS
All recording devices must meet the requirements stated in IFTA Procedures Manual Section P640 and P660.
When the device is to be used alone, printed reports must be produced which replace handwritten trip reports. The printed trip reports shall be retained for audit. Vehicle and fleet summaries which show miles and kilometers by jurisdiction must then be prepared manually.
For further detailed requirements please reference the IFTA Procedures Manual located on the IFTA website www.iftach.org
Yes, to obtain credit for withdrawals from licensee-owned tax paid bulk storage, the following records must be maintained.
- Date of withdrawal;
- Number of gallons or liters;
- Fuel type;
- Unit number;
- Purchase and inventory records to substantiate that tax were paid on all bulk purchases.
Yes, all IFTA carriers based in Kansas are subject to audit. Kansas is required to audit 3 percent of their base jurisdictions licensee’s every year.
Licensees selected for an audit will be contacted in writing 30 days prior to the audit date. The auditor(s) will notify the licensee of the time period to be audited and the records to be reviewed.
After the audit, the licensee will be advised of the audit findings, including adjustments to fuel tax liabilities for affected jurisdictions, and suggestions for record-keeping improvements. The other member jurisdictions affected will be notified of the results. The licensee may be subject to a supplemental audit if any member jurisdiction disagrees with the audit results.
Yes, if you do not agree with your audit findings you may request an informal conference from the Secretary of Revenue. To request an informal conference, please send a written request, stating the reasons for your objections along with a copy of the audit notice. In order to preserve your appeal rights you must request a conference within 30 days of the date of the letter. Send your request to: Office of administrative Appeals, Kansas Department of Revenue 915 SW Harrison ST., Topeka KS 66625-0001.
Once we review your request, we will contact you to schedule the informal conference. If possible, the conference will be held over the telephone to save you time and travel expense.
Liquid Fuel Carrier License
You will need a Liquid Fuel Carrier License if you wish to:
- Transport motor fuel, including aviation fuel, within the state of Kansas in quantities of 3,500 gallons or more;
- Transport across the state line in quantities of 120 gallons or more; or
- Pick up fuel from the refinery, pipeline, or place of manufacture, regardless of quantity.
Liquefied Petroleum (LP)
If you are an LP-gas dealer that is placing LP-gas in the fuel supply tank of a motor vehicle and/or your LP-gas delivery truck(s) run on LP-gas pulled from the cargo tank, you are required to have an LP-gas User-Dealer license as found in K.S.A. 79-3495.
If you own a vehicle licensed to be operated upon Kansas public highways and roads that burns LP-gas you may also apply for an LP-gas User-Dealer license, however you may opt to use the alternative method of calculating and paying the motor fuel tax. This option does not require a license but does require the vehicle to have a Special LP-gas permit user’s decal as found in K.S.A. 79-3492b.
Mileage Basis decals, are issued to licensed LP-gas users or dealers who consume LP-gas withdrawn from the cargo tank to power the truck they are delivering LP from while upon the public highways of the state or an individual that opts to pay the fuel tax monthly on the mileage traveled.
Special LP-gas permits also known as Pre-Paid Permits, are for those who own a vehicle powered by LP-gas and prepay the LP-gas tax annually, based on the miles operated and the weight class of the vehicle as found in K.S.A. 79-3492b. They only report miles actually traveled in Kansas. If a vehicle does not have an odometer, it can not be registered under the Special LP-gas permit.
The LP-gas User-Dealer license requires an application fee of $5.00 and a bond in the amount of 3 months tax liability but not less than $1,000.00.
Special LP-gas permits do not require a license fee or bond.
LP-gas User-Dealer (Mileage Basis) must file a Liquefied Petroleum Motor Fuel Tax Return (MF-202) monthly, which is due on the 25th of the following month that the fuel was used or sold.
Special LP-gas permits (Pre-paid) are filed annually when the decal is applied for or renewed (MF-10).
If I own a vehicle that operates on CNG or LNG and is registered with either a Mileage basis or Special Pre-paid decal and I purchase fuel at an unmanned station and am charged the motor fuel tax, how do I receive credit for the tax paid on the purchase?
If you have a Special Pre-paid decal that is renewed annually and you have paid tax at the time of purchase at an unmanned station, you will need to maintain records of those purchases. At the time of renewal you will take credit for tax paid at time of purchase and include copies of receipts showing Kansas motor fuel tax charged.
Mileage basis customers will need to take a credit for tax paid for those purchases at an unmanned station, on the monthly LP-gas return (MF-202). To claim the credit, copies of receipts showing Kansas motor fuel tax charged, need to be included with the return at time of filing.