A bill to amend the Internal Revenue Code of 1986 to allow for payments to certain individuals who dye fuel, and for other purposes.
Bill: S.2877 | Sponsor: Sen. Baldwin, Tammy (D-WI)
Policy area: Taxation

Summary:
This bill allows payments, in lieu of tax credits, to individuals who remove from a terminal eligible indelibly dyed diesel fuel or kerosene.

To amend the Internal Revenue Code of 1986 to allow for payments to 
       certain individuals who dye fuel, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. PAYMENT TO CERTAIN INDIVIDUALS WHO DYE FUEL.

    (a) In General.--Subchapter B of chapter 65 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 6433. DYED FUEL.

    ``(a) In General.--If a person establishes to the satisfaction of 
the Secretary that such person meets the requirements of subsection (b) 
with respect to diesel fuel or kerosene, then the Secretary shall pay 
to such person an amount (without interest) equal to the tax described 
in subsection (b)(2)(A) with respect to such diesel fuel or kerosene.
    ``(b) Requirements.--
            ``(1) In general.--A person meets the requirements of this 
        subsection with respect to diesel fuel or kerosene if such 
        person removes from a terminal eligible indelibly dyed diesel 
        fuel or kerosene.
            ``(2) Eligible indelibly dyed diesel fuel or kerosene 
        defined.--The term `eligible indelibly dyed diesel fuel or 
        kerosene' means diesel fuel or kerosene--
                    ``(A) with respect to which a tax under section 
                4081 was previously paid (and not credited or 
                refunded), and
                    ``(B) which is exempt from taxation under section 
                4082(a).
    ``(c) Cross Reference.--For civil penalty for excessive claims 
under this section, see section 6675.''.
    (b) Conforming Amendments.--
            (1) Section 6206 of the Internal Revenue Code of 1986 is 
        amended--
                    (A) by striking ``or 6427'' each place it appears 
                and inserting ``6427, or 6433''; and
                    (B) by striking ``6420 and 6421'' and inserting 
                ``6420, 6421, and 6433''.
            (2) Section 6430 of such Code is amended--
                    (A) by striking ``or'' at the end of paragraph (2), 
                by striking the period at the end of paragraph (3) and 
                inserting ``, or'', and by adding at the end the 
                following new paragraph:
            ``(4) which are removed as eligible indelibly dyed diesel 
        fuel or kerosene under section 6433.''.
            (3) Section 6675 of such Code is amended--
                    (A) in subsection (a), by striking ``or 6427 
                (relating to fuels not used for taxable purposes)'' and 
                inserting ``6427 (relating to fuels not used for 
                taxable purposes), or 6433 (relating to eligible 
                indelibly dyed fuel)''; and
                    (B) in subsection (b)(1), by striking ``6421, or 
                6427,'' and inserting ``6421, 6427, or 6433,''.
            (4) The table of sections for subchapter B of chapter 65 of 
        such Code is amended by adding at the end the following new 
        item:

``Sec. 6433. Dyed fuel.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to eligible indelibly dyed diesel fuel or kerosene removed on or 
after the date that is 180 days after the date of the enactment of this 
section.
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