Miscellaneous Fuel Tax Corrections Act of 1995

Summary: Miscellaneous Fuel Tax Corrections Act of 1995 - Amends the Internal Revenue Code to mandate interest on gasoline tax refunds to wholesale distributors, if the refunds are not paid within a specified period.  Limits the period in which a refund claim may be filed. 
Revises requirements regarding the filing of claims for refunds concerning nontaxable uses of diesel and aviation fuel. 
Allows a refund, with interest, to the ultimate vendor (currently, a refund, without interest, to the ultimate purchaser) for the tax paid on non-gasoline fuel used in a bus.  Prohibits applying to diesel fuel used as heating oil provisions authorizing certain ultimate purchaser refunds (without interest). 
Makes any use of diesel fuel in a diesel-powered boat nontaxable under provisions relating to manufacturers' excise taxes.  Makes dyed diesel fuel sold for use or used in a diesel-powered boat taxable if a tax is imposed under provisions relating to retail excise taxes and that tax is not paid. 
Allows, without penalty, the addition of kerosene to dyed fuel in certain circumstances. 
Considers nontaxable the accidental addition of diesel fuel on which tax has been imposed to dyed diesel fuel.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Miscellaneous Fuel Tax Corrections 
Act of 1995''.

SEC. 2. INTEREST PAYABLE ON GASOLINE TAX REFUNDS TO WHOLESALE 
              DISTRIBUTORS.

    Paragraph (4) of section 6416(a) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new subparagraph:
                    ``(C) Period for filing claims, etc.--
                            ``(i) In general.--A claim may be filed 
                        under this paragraph by any person with respect 
                        to gasoline sold during any period--
                                    ``(I) for which $200 or more is 
                                payable under this paragraph, and
                                    ``(II) which is not less than 1 
                                week.
                            ``(ii) Payment of claim.--Notwithstanding 
                        subsection (b), if the Secretary has not paid 
                        pursuant to a claim filed under this paragraph 
                        within 20 days after the date of the filing of 
                        such claim, the claim shall be paid with 
                        interest from such date determined by using the 
                        overpayment rate and method under section 6621.
                            ``(iii) Time for filing claim.--No claim 
                        filed under this paragraph shall be allowed 
                        unless filed during the 1st quarter following 
                        the last quarter included in the claim.''

SEC. 3. INTEREST PAYABLE ON REFUNDS OF TAXES ON DIESEL FUEL AND 
              AVIATION FUEL.

    Paragraph (4) of section 6427(i) of the Internal Revenue Code of 
1986 is amended to read as follows:
            ``(4) Special rule for nontaxable uses of diesel fuel and 
        aviation fuel.--
                    ``(A) In general.--A claim may be filed under 
                subsection (l) by any person with respect to fuel used 
                by such person for any period--
                            ``(i) for which $250 or more is payable 
                        under subsection (l), and
                            ``(ii) which is not less than 1 month.
                    ``(B) Payment of claim.--Notwithstanding subsection 
                (l)(1), if the Secretary has not paid pursuant to a 
                claim filed under this paragraph within 20 days after 
                the date of the filing of such claim, the claim shall 
                be paid with interest from such date determined by 
                using the overpayment rate and method under section 
                6621.
                    ``(C) Time for filing claim.--No claim filed under 
                this paragraph shall be allowed unless filed during the 
                1st quarter following the last quarter included in the 
                claim.''

SEC. 4. VENDOR REFUNDS FOR FUEL USED IN CERTAIN BUSES AND AS HEATING 
              OIL.

    (a) Certain Buses.--
            (1) In general.--Paragraph (1) of section 6427(b) of the 
        Internal Revenue Code of 1986 is amended to read as follows:
            ``(1) Allowance.--Except as otherwise provided in this 
        subsection and subsection (k), if--
                    ``(A) any fuel other than gasoline (as defined in 
                section 4083(a)) on the sale of which tax was imposed 
                by section 4041(a) or 4081 is used in an automobile bus 
                while engaged in--
                            ``(i) furnishing (for compensation) 
                        passenger land transportation available to the 
                        general public, or
                            ``(ii) the transportation of students and 
                        employees of schools (as defined in the last 
                        sentence of section 4221(d)(7)(C)), and
                    ``(B) the ultimate vendor of such fuel meets the 
                requirements of clauses (i) and (ii) of subsection 
                (l)(5)(B),
        the Secretary shall pay (without interest) to such ultimate 
        vendor an amount equal to the product of the number of gallons 
        of such fuel so used multiplied by the rate at which tax was 
        imposed on such fuel by section 4041(a) or 4081, as the case 
        may be.''
            (2) Refunds with interest.--Subparagraph (A) of section 
        6427(i)(5) of such Code is amended--
                    (A) by inserting ``(b) or'' before ``(l)(5)'' the 
                first place it appears,
                    (B) by striking ``subsection (l)(5)'' the second 
                place it appears and inserting ``subsections (b) and 
                (l)(5)'', and
                    (C) by striking ``subsection (l)(1)'' and inserting 
                ``subsections (b)(1) and (l)(1)''.
            (3) Technical amendments.--
                    (A) Subparagraph (B) of section 6427(b)(2) of such 
                Code is amended by striking ``(1)(B)'' and inserting 
                ``(1)(A)(ii)''.
                    (B) Paragraph (3) of section 6427(b) of such Code 
                is amended by striking ``(1)(A)'' and inserting 
                ``(1)(A)(i)''.
    (b) Heating Oil.--Subparagraph (A) of section 6427(l)(5) of such 
Code is amended by striking ``or'' at the end of clause (i), by 
striking the period at the end of clause (ii) and inserting ``, or'', 
and by adding at the end the following new clause:
                            ``(iii) as heating oil.''

SEC. 5. DIESEL FUEL SOLD FOR USE OR USED IN DIESEL-POWERED BOATS TAXED 
              ONLY ON RETAIL SALE.

    (a) Tax-Free Sales for Use in Diesel-Powered Boats.--Subsection (b) 
of section 4082 of the Internal Revenue Code of 1986 (relating to 
exemptions for diesel fuel) is amended by striking ``and'' at the end 
of paragraph (2), by striking the period at the end of paragraph (3) 
and inserting ``, and'', and by adding at the end the following new 
paragraph:
            ``(4) any use in a diesel-powered boat.''
    (b) Application of Penalty at Retail Level.--Paragraph (2) of 
section 6714(c) of such Code, as added by section 13242 of the Omnibus 
Budget Reconciliation Act of 1993, is amended to read as follows:
            ``(2) Nontaxable use.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `nontaxable use' has the 
                meaning given such term by section 4082(b).
                    ``(B) Exception for taxable sales and uses of fuel 
                in diesel-powered boats.--Subparagraph (A) shall not 
                apply to dyed fuel sold for use or used in a diesel-
                powered boat if tax is imposed on such sale or use 
                under 4041(a)(1) and such tax is not paid.''
    (c) Correction of Section Numbering.--
            (1) Part II of subchapter B of chapter 68 of such Code is 
        amended by redesignating section 6714 (relating to dyed fuel 
        sold for use or used in taxable use, etc.), as added by section 
        13242(b)(1) of the Omnibus Budget Reconciliation Act of 1993, 
        as section 6715.
            (2) The table of sections for such part is amended by 
        redesignating the item relating to section 6714 (relating to 
        dyed fuel sold for use or used in taxable use, etc.), as added 
        by section 13242(b)(2) of such Act, as section 6715.

SEC. 6. NO PENALTY ON ADDITION OF KEROSENE IN CERTAIN CASES.

    Paragraph (3) of section 6715(a) of the Internal Revenue Code of 
1986, as redesignating by section 4, is amended by inserting before the 
comma ``unless such alteration is through the addition of kerosene by a 
person who is not described in paragraph (1) or (2) with respect to 
such fuel''.

SEC. 7. REFUND FOR TAX-PAID DIESEL FUEL WHICH IS COMMINGLED WITH DYED 
              DIESEL FUEL.

    Paragraph (2) of section 6427(l) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new flush sentence:
        ``Such term includes the addition of diesel fuel on which tax 
        has been imposed by section 4081 to dyed diesel fuel if such 
        addition is established to the satisfaction of the Secretary as 
        being accidental.''

SEC. 8. EFFECTIVE DATE.

    The amendments made by this Act shall take effect on the date of 
the enactment of this Act; except that no interest shall be paid by 
reason of such amendments with respect to any claim filed before such 
date.