Federation of Tax AdministratorsMotor Fuel Excise Tax Update

Jackson Hole, WyomingOctober 1, 2014

Alabama

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• MC, LLC v. Alabama DOR; No. MV. 13-1289, July 31, 2014

• The Taxpayer is correct that the IFTA manual provides that if a taxpayer fails to maintain adequate records, the Department is authorized to calculate the fuel usage by applying a standard 4 mpg rate. But the IFTA audit manual, at A550.100, also allows the Department to use an industry average. The Department accordingly used the industry average of 6 mpg in this case.

Alabama

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• The Taxpayer argues that by using 6 mpg instead of 4 mpg, its liability increases by 50 percent. On the contrary, the Department's use of the 6 mpg estimate decreased the Taxpayer's liability because using the 6 mpg estimate instead of the 4 mpg estimate meant that the Taxpayer used, and thus purchased, a lesser amount of fuel to travel the same distance. For example, if one of the Taxpayer's vehicle traveled 600 miles on a trip, at 6 mpg, the Taxpayer would have used 100 gallons. If the 4 mpg estimate is used, however, the Taxpayer would have used 150 gallons, which would have resulted in additional fuel tax due. The Department's use of 6 mpg thus benefited the Taxpayer.

Connecticut

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STATE OF CONNECTICUT DEPARTMENT OF REVENUE SERVICESAN 2014(3.2)

25 Sigourney St Ste 2Hartford CT 06106-5032

ANNOUNCEMENTQuarterly List of Distributors for Motor Vehicle Fuels Tax PurposesPurpose: This Announcement identifies persons who have become, or are no longer, licensed as motor fuels distributors by the Department of Revenue Services (DRS) since the current annual list was published.Background: On or about January 31 of each year, DRS publishes an annual list of licensed motor fuels distributors on its website at www.ct.gov/DRS. DRS updates the annual list on or around April 30, July 31, and October 31 of each year by publishing on its website a quarterly list identifying the persons who have become, or are no longer, licensed distributors since the current annual list and any subsequent quarterly list(s) were published. Because quarterly lists are not cumulative, it is necessary to consult the current annual list, any subsequent quarterly list(s), and the current quarterly list to determine whether a person is a licensed distributor.Effective Date: This Announcement is effective upon issuance.

Kentucky

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• Revelation Energy v. DOR; File No. K13-R-08; June 24, 2014

• The Kentucky Board of Tax Appeals upheld a Department of Revenue ruling denying a taxpayer’s  claim  for  refund  of  special  fuels  taxes and petroleum environmental assurance fees paid on its purchases of special fuel for use in nonhighway vehicles or equipment during the period 2009—2011.

Kentucky

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• The taxpayer argued that statutory provisions requiring a refund permit violated the U.S. and Kentucky Constitutions under due process and equal protection. As this was a facial challenge to a statute, the board could not rule on the constitutional issue presented. Accordingly, the board  upheld  the  department’s  ruling  and  noted  that the taxpayer had properly preserved before the board its challenge to the facial constitutionality of the statute for further appellate review.

New Jersey PPGRT

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• Petroleum Products Gross Receipts Tax• Elective suppliers are required to collect

PPGRT on all NJ destined products.• Permissive suppliers are elective suppliers and

suppliers can elect to be elective suppliers.

New Jersey PPGRT

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54:15B-3.a.There is imposed on each company which is engaged in the refining or distribution, or both, of petroleum products and which distributes such products in this State a tax . . . of its gross receipts derived from the first sale of petroleum products within this State;

New Jersey PPGRT

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54:15B-3.b.There is imposed on each company that imports or causes to be imported, other than by a company subject to and having paid the tax on those imported petroleum products that have generated gross receipts taxable under subsection a. of this section, petroleum products for use or consumption by it within this State a tax . . . of the consideration given or contracted to be given for such petroleum products if the consideration given or contracted to be given for all such deliveries made during a quarterly period exceeds $5,000;

New Jersey PPGRT

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54:39-118.aA licensed supplier or licensed permissive supplier may make a blanket election with the director to treat all removals of fuel from all of its out-of-State terminals with a destination in this State as shown on the terminal-issued shipping paper as if the removals were removed across the rack by the supplier or permissive supplier from a terminal in this State for all purposes.54:39-118.bThe election allowed by this section shall be made by filing a "notice of election" with the director, in the form and manner as the director by regulation may prescribe.

New Jersey PPGRT

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54:39-118.cThe director shall publish a list of suppliers electing pursuant to this section.54:39-118.dThe absence of an election by a supplier in accordance with this section shall in no way relieve the supplier of responsibility for remitting the tax imposed by the "Motor Fuel Tax Act," P.L.2010, c.22 ( C.54:39-101 et seq.) upon the removal from an out-of-State terminal for import into this State by the supplier.

New Jersey PPGRT

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54:39-118.eA supplier that makes the election allowed by this section shall precollect the tax imposed by P.L.2010, c.22 ( C.54:39-101et seq.) on all removals from a qualified terminal on its account as a position holder, or as a person receiving fuel from a position holder pursuant to a terminal bulk transfer, without regard to the license status of the person acquiring the fuel from the supplier, the point or terms of sale, or the character of delivery.

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Tax Elective Supplier

Elective Supplier End Date

Company City State Effective Date

License End Date

LMF-S ABENGOA BIOENERGY OF ILLINOIS LLC MADISON IL 6/1/2011

LMF-S AEGEAN BUNKERING (USA) LLC NEW YORK NY 12/17/2013

LMF-S AG ENVIRONMENTAL PRODUCTS, L.L.C. OMAHA NE 1/1/2011

LMF-S AIRCRAFT SERVICE INTERNATIONAL, INC NEWARK NJ 1/1/2011

LMF-S Y AIR TRAN FUEL SERVICES, INC. DALLAS TX 9/24/2013

LMF-S ALCOCHEM, INC. HOUSTON TX 1/1/2011 8/31/2012

LMF-S ALCOTRA NORTH AMERICA INC. HOUSTON TX 1/1/2011

LMF-S Y AMERIGREEN ENERGY INC LANCASTER PA 5/10/2011

LMF-S Y APEX OIL COMPANY, INC. ST LOUIS MO 1/1/2011

LMF-S ARC PHYSICAL INVESTMENTS LLC HOUSTON TX 2/1/2011

LMF-S ARCHER-DANIELS-MIDLAND COMPANY DECATUR IL 1/1/2011

LMF-S ASTRA OIL COMPANY LLC HUNTINGTON BEACH CA 1/1/2011

LMF-S Y ATLANTIC TRADING & MARKETING, INC HOUSTON TX 1/1/2011

New Jersey PPGRT

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In addition to the powers granted to the director by P.L.2010, c.22 ( C.54:39-101 et al.), the director is authorized and empowered:54:39-148.ato make, adopt and amend rules and regulations appropriate to carrying out P.L.2010, c.22 ( C.54:39-101 et al.) and accomplishing its purposes;54:39-148.hto co-collect with the tax imposed pursuant to P.L.2010, c.22 ( C.54:39-101 et al.), the tax imposed pursuant to the "Petroleum Products Gross Receipts Tax Act," P.L.1990, c.42 ( C.54:15B-1 et seq.) pursuant to such procedures as the director may prescribe.

Washington

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• Hazardous Substance Tax - Statute –82.21.020(1) "Hazardous substance" means: –82.21.020(1)(a) CERCLA substances; –82.21.020(1)(b) Petroleum products; –82.21.020(1)(c) Pesticide products required

to be registered under section 136a of the federal insecticide, fungicide and rodenticide act,; and

Washington

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• Hazardous Substance Tax - Statute – 82.21.020(1)(d) Any other substance, category of

substance, and any product or category of product determined by the director of ecology by rule to present a threat to human health or the environment if released into the environment. The director of ecology shall not add or delete substances from this definition more often than twice during each calendar year. For tax purposes, changes in this definition shall take effect on the first day of the next month that is at least thirty days after the effective date of the rule.

Washington

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• Hazardous Substance Tax - Statute – The word "product" or "products" as used in this

paragraph (d) means an item or items containing both: (i) One or more substances that are hazardous substances under (a), (b), or (c) of this subsection or that are substances or categories of substances determined under this paragraph (d) to present a threat to human health or the environment if released into the environment; and (ii) one or more substances that are not hazardous substances.

Washington

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• Hazardous Substance Tax - Statute – 82.21.020(2) "Petroleum product" means plant condensate,

lubricating oil, gasoline, aviation fuel, kerosene, diesel motor fuel, benzol, fuel oil, residual oil, liquefied or liquefiable gases such as butane, ethane, and propane, and every other product derived from the refining of crude oil, but the term does not include crude oil.

Washington

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• Hazardous Substance Tax - Regulations – WAC458-20-252(Rule252)(1)(c) The hazardous

substance tax is imposed upon any possession of a hazardous substance or product in this state by any person who is not expressly exempt of the tax.

– WAC458-20-252(Rule252)(2)(b) ”Hazardous  substance”  means anything designated as such by the provisions of Chapter 173-WAC, administered by the State Department of Ecology, as adopted and thereafter amended. In addition, the law defines this term to include:

Washington

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• Hazardous Substance Tax - Regulations • WAC458-20-252(Rule252)(2)(b)(i) any substance

that is a Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) substance. Combinations of CERCLA substances as ingredients together with nonhazardous substances will not be taxable unless the end product is specifically designated as a hazardous substance by the Department of Ecology.

Washington

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• Hazardous Substance Tax - Regulations • WAC458-20-252(Rule252)(2)(b)(ii) petroleum products

(further defined below); • WAC458-20-252(Rule252)(2)(b)(iii) pesticide products

required to be registered under the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA); and

• WAC458-20-252(Rule252)(2)(b)(iv) anything else enumerated as a hazardous substance in Chapter 173 __________ WAC by the Department of Ecology.

Washington

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• Hazardous Substance Tax - Regulations – WAC458-20-252(Rule252)(2)(c) “Product(s)”  

means any item(s) containing a combination of ingredients, some of which are hazardous substances and some of which are not hazardous substances.

Washington

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• Hazardous Substance Tax - Regulations – WAC458-20-252(Rule252)(2)(d) “Petroleum  product”  means any plant condensate, lubricating oil, crank case motor oil, gasoline, aviation fuel, kerosene, diesel motor fuel, benzol, fuel oil, residual fuel, asphalt base, liquefied or liquefiable gases, such as butane, ethane and propane, and every other product derived from the refining of crude oil, but the term does not include crude oil.

Washington

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• Hazardous Substance Tax - Regulations – WAC458-20-252(Rule252)(2)(d)(i) The term “derived  from the refining of crude oil”  as used herein, means produced because of and during petroleum processing.  “Petroleum  processing”  includes all activities of a commercial or industrial nature wherein labor or skill is applied, by hand or machinery, to crude oil or any byproduct of crude oil so that as a result thereof a fuel or lubricant is produced for sale or commercial or industrial use.

Washington

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• Hazardous Substance Tax - Regulations – “Fuel”  includes all combustible gases and liquids

suitable for the generation of energy. The term “derived  from the refining of crude oil”  does not mean petroleum products which are manufactured from refined oil derivatives, such as petroleum jellies, cleaning solvents, asphalt paving, etc. Such further manufactured products become hazardous substances only when expressly so designated by the Director of Ecology.

WashingtonSTATE OF WASHINGTON

DEPARTMENT OF REVENUEInterpretations and Technical Advice Division

P O Box 47453 Olympia, Washington 98504-7453 Phone (360) 534-1570INTERPRETIVE STATEMENT ISSUED

The Department of Revenue has issued the following Excise Tax Advisory (ETA): ETA 3190.2014 Hazardous Substance Tax, Biodiesel (B100), and B99.9/B99 Biodiesel Blend

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Washington• B99.9/B99 biodiesel blend is produced when

0.1 to 1 % (by volume) of petroleum diesel is added to biodiesel (B100). Producers or blenders may add this amount of petroleum diesel  to  receive  a  blender’s  tax  credit  under  federal law (26 U.S.C. § 6426(c)); and

• B99.9/B99 biodiesel blend that meets the ASTM D6751 specifications is not considered a hazardous substance for HST purposes and is not subject to the HST.

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WashingtonThis ETA first explains the following:• “Biodiesel”  (B100)  is  a  fuel  blend  stock  comprised  of  

mono-alkyl esters of long chain fatty acids derived from vegetable oils or animal fats, designated B100, and meeting the requirements of American Society for Testing and Materials (ASTM) D6751 specifications for Biodiesel Fuel (B100) – Blend Stock for Distillate Fuels;

• B100 is not a hazardous substance for hazardous substance tax (HST) purposes and is not subject to HST;

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Wisconsin

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State of WisconsinDepartment of Revenue

Motor Vehicle Fuel Tax InformationIncluding the Petroleum Inspection Fee

Publication 307 (07/14)

Wisconsin

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I. INTRODUCTIONThis publication provides information concerning Wisconsin's motor vehicle fuel tax law and petroleum inspection fee. It explains who requires a motor vehicle fuel license or a petroleum products shipper license, when reports are due, what sales are exempt from the motor vehicle fuel tax and petroleum inspection fee, what records to keep, the interest and penalties imposed on incorrectly or late filed reports, the reporting requirements of interstate motor carriers, and other related topics.

Federal Mixture Tax Credit

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� 26 U.S.C §§6426, 6427 and §34�Biodiesel, ethanol, alternative fuel and

renewable diesel mixture excise tax credits and related income tax credit are not includible in gross income and are therefore exempt from federal income tax.

History of the Tax Credit

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� Crude Oil Windfall Profit Tax Act of 1980

� §40 non-refundable income tax credit

for the use of certain alcohol fuels, including methanol and ethanol, but not alcohol produced from petroleum, natural gas, coal, or alcohol with proof of less than 150.

History of the Tax Credit

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� American Job Creation Act of 2004

� Enacted §6426 and §6427

provides tax credit for biodiesel, alcohol, renewable diesel and alternative fuel blenders, users and retailers including:

� a refundable income tax credit under §34 via §6427

� an excise tax credit under §6426

� A non-refundable biodiesel fuel income tax credit under §40A (Energy Policy Act of 2005)

History of the Tax Credit

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� Many taxpayers claimed the mixture credit as an excise tax credit.

� The alcohol fuel mixture credit expired on December 31, 2011.

� The biodiesel, renewable diesel and alternative fuel credits expired on December 31, 2013.

Analysis of the Tax Credit

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� The alcohol and biodiesel fuels tax credits in §§40 and 40A are includible in gross taxable income.

� §§6426, 6427 or related §34 tax credits are not includible in gross taxable income.

Analysis of the Tax Credit

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� 26 U.S.C §87 was amended to include the §40A biodiesel income tax credits but not the excise tax credits.

� Congress has stated consistently the §§40 and 40A credits are includible in gross taxable income but has NEVER stated that §6426 credits are includible in income.

� IRS forms support the position that the §§6426 and 6427 credits are NOT includible in gross taxable income.

Analysis of the Tax Credit

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� 26 U.S.C §87 was amended to include the §40A biodiesel income tax credits but not the excise tax credits.

� The §6426 excise tax credits and §34 income tax credit via §6427 are not includible  in  gross  income  is  found  in  Congress’  actions  in  enacting  the  §40A.� Original House Version of the Jobs Act did not include the §40A

credit, only the §6426 excise tax credit for alcohol mixtures.� Senate added an amendment to the §6426 provision to include an

excise tax credit for the creation of biodiesel mixtures, but also added a non-refundable income tax credit for biodiesel fuels in §40A non-refundable income tax credit for biodiesel fuels.

� Congress also enacted a conforming amendment to §87 to bring this non-refundable income tax credit within gross income for the purposes of federal income tax.

Analysis of the Tax Credit

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� Congress has stated consistently that the §§40 and 40A credits are includible in income but has NEVER stated that §6426 credits are includible in income.

� The legislative history of the Job Act states the §40 credit is includible in gross income, and adds a conforming amendment with the enactment of §40A, but is silent with respect to the §§6426 and 6427 credit.

� Conference Report 110-627 to Public Law 110-234� Senate Report 112-208 to the Family and Business

Tax Cut Certainty Act of 2012

Analysis of the Tax Credit

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� IRS forms support the position that the §§6426 and 6427 credits are NOT includible in gross income.

� The §§6426 and 6427 excise tax credits and the §34 income tax credits are not includible in gross income can be found in IRS forms used to claim the tax credits.

� Form 4136� Form 720� Form 8849

Analysis of the Tax Credit

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� Form 720� Statutory requirement that the credits be claimed first as an offset

against §4081 excise tax liability, using Form 720, Schedule C, � Tax offset is not the same as a deduction which reduces income tax

liability.

� Form 8849� A payment of a tax credit as required in §6427, not a refund of tax paid

Conclusion

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� The §§6426 and 6427 excise tax credits and related §34 refundable income tax credit are NOT includible in gross income and are exempt from federal income tax.

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 ______________________________________

FORM 10-K (Mark One) _ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2013

______________________________________

RENEWABLE ENERGY GROUP, INC. (Exact name of registrant as specified in its charter)

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NOTE 13—INCOME TAXESThe Company historically included revenue from certain government incentive payments in taxable income on its federal and state income tax returns. In connection with the U.S. Internal Revenue Service audits of the 2011 and 2010 years, the Company proposed that these government incentive payments should be excluded from taxable income. The U.S. Internal Revenue Service accepted this position and on August 1, 2013, the Company received notification from the congressional Joint Committee on Taxation approving the audit results and associated refund claim. Based on information obtained in connection with these audits, the Company changed its position related to these government incentive payments to exclude them from taxable income for years 2008 through the current year.

Oil Spill Tax

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4611(a)GENERAL RULE.—IRC HistoryThere is hereby imposed a tax at the rate specified in subsection (c) on—4611(a)(1)crude oil received at a United States refinery, and4611(a)(2)petroleum products entered into the United States for consumption, use, or warehousing.

Oil Spill Tax

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4612(a)DEFINITIONS.—For purposes of this subchapter—4612(a)(1)CRUDE OIL.—The  term  “crude  oil”  includes  crude  oil  condensates  and natural gasoline.4612(a)(2)DOMESTIC CRUDE OIL.—The  term  “domestic  crude  oil”  means  any  crude  oil  produced from a well located in the United States.4612(a)(3)PETROLEUM PRODUCT.—The  term  “petroleum  product”  includes  crude  oil.

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List of Petroleum and Non-petroleum Oils This list of oils is organized alphabetically into several subgroups. Crude oil and refined petroleum products are among the most familiar types of oils. Petroleum and fuel oil are specifically named in the Clean Water Act (CWA) definition of oil. Edible animal and vegetable oils and other oils of animal or vegetable origin have historically been considered CWA oils. Other non-petroleum oils are substances that have the properties and behavior of traditional oils and have historically been considered to be oils. Lube-oil additives are included in the list of oils because they may be shipped or stored in an oil medium. Some substances that have not been considered oils historically may be added to this list in the future if they are determined to have oil-like characteristics. If you have a question about whether a commodity that does not appear on this list is regulated as an oil, please call Mr. Patrick Keffler, CG-ENG-5, at (202) 372-1424.

www.homeport.uscg.mil

Go to Missions/Environmental/Hazardous Materials Standards

Finally

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• Bank Intermediation Agreements• 2290’s• Return Due Date/Payment Due Date