General: All combustible gas and liquids, other than gasoline, which propel registered motor vehicles, are special fuels. Only licensed suppliers and user‑sellers maintain storage facilities of special fuels. Only licensed suppliers are allowed to make bulk sales of special fuels. Suppliers acquire special fuels on a tax‑free basis and collect the tax from user‑sellers and users. User-sellers are required to pay the excise on all special fuels acquisitions.

A. SUPPLIERS

 

Application for License: Suppliers of special fuel must file Form SFT-1 with a $25.00 fee initially and renew by each January 1st. All returns must be filed and outstanding taxes must be paid before a license as a Supplier of Special Fuels will be granted.

 

Filing Requirements: Suppliers of special fuel must file Form SFT-3 by the 20th day of each month for special fuel supplied during the previous month. Form SFT-3 must be filed even if no tax is due.

 

Payment: Suppliers with total annual payments in excess of $10,000 must make payments monthly via electronic funds transfer (EFT). Failure to make electronic payments may result in a penalty per G.L. c. 62C, § 33(g). For those not required to make electronic payments, the payment must be included with the monthly return. Make the check or money order for the exact amount payable to the Commonwealth of Massachusetts.

 

Rate of Tax: As of July 31, 2013, the rate of tax is $.24 per gallon. For liquified gases (propane, CNG, LNG, etc.), the rate is 19.1% of the average price per gallon (as determined by the Commissioner for each calendar quarter) computed to the nearest 10th of a cent per gallon. Liquefied gas suppliers will be notified of the rate approximately four (4) weeks before the start of the calendar quarter. The current liquefied gas tax rate is also published on the DOR website ( www.mass.gov/dor) in the Fuels Excise Information section.

 

Exemptions: The following sales or uses are either exempt from tax or may entitle the purchaser to a refund: (1) sales to the federal government; (2) sales in foreign or interstate commerce, except where permitted under the Constitution and laws of the United States; (3) sales to foreign embassies; (4) sales by one licensed supplier to another or to a person duly licensed in another state (under certain restrictions); (5) sales of special fuels used in watercraft; (6) sales to regional transportation authorities and certain authorities including MWRA, MBTA, and MASSPORT; (7) sales of special fuels for propelling any vehicle on a turnpike constructed by the Massachusetts Turnpike Authority; (8) sales of special fuels for off‑highway use; and (9) sales of special fuels for farm purposes. In certain instances, sales or use tax may nonetheless apply.

 

Interest and Penalties: If returns are not properly filed, interest and penalties may be assessed. As of January 1, 1993, the Massachusetts interest rate is based on the federal short‑term rate plus four percentage points, compounded daily. G.L. c. 62C, § 32, as amended. For more information on calculation of interest, see Regulation 830 CMR 62C.33.1, TIR 92-6 and the quarterly TIRs that update the interest rates. The penalty for late filing is 1%/month or fraction thereof, not to exceed 25% of the amount due; and the penalty for late payment is 1%/month for each month or fraction thereof, not to exceed 25% of the amount due.

 

See TIR 99-18 regarding waiver of G.L. c. 62C, § 33(c) late‑pay penalties and suspension or involuntary collection activities under G.L. c. 62C, § 32(e) when the taxpayer disputes the assessment (or any portion thereof) administratively within DOR or with the Appellate Tax Board or Probate Court.

 

Extensions of Time to File: For good cause, the Commissioner may grant a reasonable extension of time for filing a return. Requests must be in writing to the address below. Failure to pay 80% of the tax required to be paid on or before the due date for payment of tax will void any extension of time to file and the return will be subject to penalty as a late return. See 830 CMR 62C.19.1.

 

Amended Returns: No special form is required to amend a return. Write "Amended" on the top of Form SFT-3.

 

Refunds: User-sellers and users of special fuels may submit refund applications. A copy of the tax receipt showing the tax paid must accompany the application.

 

Use the following forms to apply for special fuel refunds:

 




Type


Form

 

Off‑Highway Use

SFT-9, Special Fuels Refund Application

 

Turnpike

SFT-9T, Special Fuels Refund Application for Massachusetts Turnpike Use

 

Motor Carrier (IFTA)*

IFTA-100, IFTA Quarterly Fuel Use Tax Return*

 

* A motor carrier licensed under the International Fuel Tax Agreement (IFTA) applies for a special fuels tax refund for special fuels consumed on the Massachusetts Turnpike on its IFTA-100, IFTA Quarterly Fuel Use Tax Return. Massachusetts Turnpike miles are included in the total IFTA miles, but are excluded from the Massachusetts taxable miles. An IFTA motor carrier claiming this exemption must file a Business Use Tax Return, Form ST-10, and pay the 6.25% use tax on the fuel consumed in exempt travel on the Massachusetts Turnpike.

 

All refund claims must be filed within two years of the date of purchase. For more information on Massachusetts Turnpike refunds, see LR 84-82.

 

A special fuel refund may only be claimed for special fuels excise paid to Massachusetts.

 

Abatements: Suppliers may apply for abatements using Form CA-6, handled by the Customer Service Bureau.

 

Changing Information or Status: Changes must be submitted in writing to the address given below.

 

For more information, contact:

 

Massachusetts Department of Revenue
Excises Unit, Special Fuels Tax Section
P.O. Box 7012
Boston, MA 02204
(617) 887-5060

 

B. USER-SELLERS

 

Application for License: User‑sellers of special fuel must file license application Form SFT-1 with a $25.00 fee initially and renew by each January 1st.

 

Filing Requirements: User‑sellers of special fuel must file Form SFT-4 by the 20th day of each month for special fuel used or sold during the previous month. Form SFT-4 must be filed although no tax is due.

 

Extensions of Time to File: For good cause, the Commissioner may grant a reasonable extension of time for filing a return. Requests must be in writing to the address below.

 

Amended Returns: No special form is required to file an amended return. Write "amended" on Form SFT-4.

 

Refunds: User-sellers may submit refund applications. (See above under Refunds) A special fuel refund may only be claimed for special fuels excise paid to Massachusetts.

 

Exemptions: None.

 

Changing Information or Status: Changes must be submitted in writing to the address given below.

 

For more information, contact:

 

Massachusetts Department of Revenue
Excises Unit, Special Fuels Tax Section
P.O. Box 7012
Boston, MA 02204
(617) 887-5060


 

REFERENCES:
G.L. c, 62C, §§ 32, 33(c), 33(e), 33(g)
G.L. c. 64E
830 CMR 62C.19.1
830 CMR 62C.33.1
Form CA-6, Application for Abatement - Amended Return
Form SFT-1, Special Fuels License Application
Form SFT-3, Supplier's Tax Return - Special Fuels
Form SFT-4, User - Seller's Special Fuels Tax Return
Form SFT-9, Special Fuels Refund Application
Form SFT-9T, Special Fuels Refund Application for Massachusetts Turnpike Use
Form ST-10, Business Use Tax Return
IFTA - 100, IFTA Quarterly Fuel Use Tax Return