Petroleum Taxes FAQs

Yes. You must file a return for each month that your license is in effect. If you have no liability, you still need to file a return with zero gallons reported by the due date.

You must report gasoline purchases by gross volume (and not net volume). View the statute, Minnesota Statute 296A.15.

You must also report the following types of fuel by gross volume (except for sales or transfers between fuel refineries and/or terminals): No. 1 and No. 2 diesel fuel oil or heating fuel oil, kerosene, denatured ethanol, and biodiesel. View the statute, Minnesota Statute 239.79.

Report all other fuel as listed on your original invoice.

You will receive either a refund check or an EFT refund if you overpaid a tax on your return, or if the Department of Revenue made a change to your return that reduces your tax. The refund may also be the result of an audit that recently took place on your Petroleum Tax returns. You should keep copies of any tax form or refund claim you file for your reference and in case you are ever audited.

The Department of Revenue corrects minor errors we find on refund claims. Also, our computer system automatically rounds the gallons on your claim form to the nearest gallon. Either of these may result in a different refund amount.

Motor fuel refund claims must be filed within one year from the date of purchase. The postmark date is considered the filing date. For more information on motor fuel refunds, see Form PDR-1, Minnesota Motor Fuel Claim for Refund. 

Call our Petroleum Tax unit at 651-296-0889 and ask to speak to an auditor.

It normally takes up to six weeks to receive a refund after you file a claim. We will review your claim and notify you in writing if your claim is denied. If you haven't heard from us or received your refund after six weeks, you may contact our Petroleum Tax unit at 651-296-0889.​

Enter you bank information on Form PDR-1, Minnesota Motor Fuel Claim for Refund. If the information is different from previous claims, highlight the area.​

Generally, yes. The Motor Fuel Excise Tax is separate from sales tax. Certain activities are sales tax exempt, to get more information on these activities see Petroleum Products (Sales Tax Fact Sheet 116).​

If you file a monthly EDI file through the e-Data Exchange system, you must submit a new (amended) EDI file for the month you wish to amend. Depending on the changes you may have a new credit or liability. If you have a new liability you will have to pay the additional tax when you amend your file by your normal payment method.

If you don't file an EDI file monthly, you will have to amend your previously filed returns in our e-Services system.  ​

It depends on how long it's been since the original return was filed and which specific tax or fee is involved, as outlined below.

Prior period adjustments are not allowed for periods following a tax rate or surcharge change.

For the Gasoline Tax, Special Fuel Tax and the Petroleum Inspection Fee:

• To report transactions from more than two months ago, you must always submit an amended return.
• Amended returns must include all the original and amended transactions.

For the Petroleum Tank Release Cleanup Fund Fee:

• You may report transactions from prior periods on your current return, subject to the same limitations as listed above.
• However, you must submit an amended return in the following situations:
  • If you forgot to report a load of fuel on a return while the fee was inactive, and the fee becomes active the next month, you must amend the return.
  • If you didn't include the fee for a load of fuel while the fee is active, and you realized after filing your return that the fee should have been included, you must amend the return.
• Amended returns must include all original and amended transactions.

To help reduce tax cheating. Dyed fuel indicates that no Motor Fuel Excise Tax has been paid on the fuel. It may only be used in non-licensed vehicles or equipment for specific, tax-exempt activities. Anyone using dyed fuel on public roads or for non-exempt purposes is evading the excise tax and will be penalized if caught.​

Anyone selling dyed fuel for use on public roads is breaking the law. Please report them to the proper authorities by calling the Department of Revenue tip line at 651-297-5195 or 1-800-657-3500.​

IRS officials have been monitoring possible supply problems with undyed diesel fuel and will announce any remedial actions taken.

Please report supply problems to the IRS. If you have questions or see any evidence of violations, call the nearest IRS office or the Minnesota Petroleum Tax Unit at 651-556-6354.​

Dyed fuel can also be used off-road in non licensed vehicles.​

When dyed fuel is used in a licensed motor vehicle, the vehicle's registered owner can be penalized $10 per gallon or $1,000 per violation, which ever is greater. The Internal Revenue Service also may penalize the vehicle owner, separately from any Minnesota penalties. View the statute, Minnesota Statute 296A.22, subdivision 4.​

The Petroleum Inspection Fee helps cover the state's cost to oversee the sales and supply of petroleum products in Minnesota.

The inspection fee is paid by fuel distributors in Minnesota. They must report and pay the fee on their monthly Gasoline Tax Return.​

LPG (Propane), CNG (Compressed Natural Gas) and LNG (Liquefied Natural Gas) are the only products that aren't subject to the inspection fee.​

If you have received a Petroleum Tax bill from the Department of Revenue, you must log in to our e-Services system to make a payment. You may pay the bill by accessing your Petroleum Tax account, or by using the "Make a Payment" link and entering the Letter ID on the bill.​

You can change your payment information when making a payment through our e-Services system. For step-by-step payment instructions click the "Help" button on the e-Services home page. ​

When filing for the months the fee is in effect, calculate and pay the fee as instructed on your fuel tax return. To see when the fee is/has been in effect, view the Petroleum Tank Cleanup Fee effective dates.

The Petroleum Tank Cleanup Fee is in effect when a committee decides it should go into effect after the state Petroleum Tank Fund drops below $4 million.

Any supplier or transporter who diverts a shipment to any other destination than that which is listed on the manifest shall notify the commissioner of Revenue within a reasonable time, setting forth the manifest number, date, kind of product, number of gallons, the consignee to whom the shipment has been diverted and the final destination.

Yes, Minnesota requires diversions of petroleum products to be registered.

Minnesota currently uses FuelTrac for their diversion registry.  Diversions are entered online at www.fueltrac.us. 

The first license distributor shall report the load as a 2A/2C and then as a 7D/13A for loads that are diverted out of Minnesota. All loads that are diverted into Minnesota should be reported as 2A/2C to pay appropriate taxes for those loads.

The Petroleum Debt Service Surcharge is a fee the state collects to help pay the principal and interest of the trunk highway bonds each fiscal year. The surcharge is imposed by Minnesota Law.

The state reviews the annual amount of revenue from the surcharge previously deposited into the trunk highway fund and calculates the total amount necessary to pay the remaining debt service.

The Petroleum Debt Surcharge rate effective July 1, 2021 to June 30, 2022 is 3.5 cents per gallon.  

B00 follows the same tax and reporting rules as undyed diesel fuel. The first licensed distributor must report and pay the Petroleum Tax on all purchase of this product.

Refer to the appeal information that was included with the Tax Order. For more information, see the Taxpayer Rights.​

Fuel terminals must keep records of receipts, disbursements, and inventories. For more information, see MN Rules 8125.0200.

Distributors, dealers, bulk purchasers, special fuel dealers and users of special fuel must keep records of all purchases, transfers, sales, and use of petroleum products and special fuel. This includes copies of all sales tickets, customer activity reports, and supplemental reports to verify all credits and deductions taken. Accurate inventories should be available as reported on Form PDA-78, Petroleum Product Reconciliation. For more information, see MN Rule 8125.0400

You must keep and maintain records for at least 3 1/2 years. View the statute, Minnesota Statute 296A.19.