What is a Texas Motor Fuel Continuous Tax Bond?

Know what this bond is for and who can obtain it!

Texas Motor Fuel Continuous Tax BondThe Texas Motor Fuel Continuous Tax Bond is a conditional surety bond that is needed for the issuance of a Fuels Tax License.

The Comptroller may or may not require the bond above to any person who conducts one or more of the following activities that involve gasoline; gasoline blended fuel, liquefied natural gas, diesel fuel, and compressed natural gas:

  • Supplier – handles motor fuel transactions in bulk transfer/terminal system and receives motor fuel in Texas under a two-party exchange
  • Permissive Supplier – a position holder of motor fuel that is located outside of Texas, but delivers motor fuel within the state
  • Aviation Fuel Dealer – controls an aircraft servicing facility that delivers gasoline or diesel fuel to aircraft
  • Distributor – buys motor fuel from a supplier or permissive supplier and sells it on a wholesale or retail basis.
  • Terminal Operator – a person who controls a terminal
  • Importer – a person who imports motor fuel into Texas
  • Exporter – A person who exports motor fuel from Texas
  • Motor Fuel Transporter – transports gasoline, gasoline blended fuel, and diesel fuel outside the bulk transfer/terminal system
  • Blender – produces blended motor fuel outside the bulk transfer/terminal system
  • Compressed Natural Gas/Liquefied Natural Gas Dealer – supplier of CNG and LNG to motor vehicles
  • Interstate Trucker – motor vehicle (two axles, three axles, or has a gross weight greater than 26,000 pounds) operator in Mexico and Texas for commercial use.
  • Dyed Diesel Fuel Bonded User – buys dyed diesel fuel for non-highway use

 

Who and what is the bond for?

The bond can be imposed by the Comptroller on a licensed holder who either:

  • Failed to file returns or remit tax on time
  • An IFTA licensee who has been discovered to have caused problems and that may pose a risk to member jurisdictions’ interests

The bond’s purpose is to ensure on-time payment of necessary taxes and strict compliance of the licensee with the provisions of the Texas Tax Code.

 

What is the bond amount?

 BOND AMOUNT 

CONDITIONS

 

 

Gasoline

 

$30,000-600,000

The amount should be equal to two times the maximum amount of tax that could accrue on tax-free gasoline purchased or acquired during a reporting period.
 

Diesel

 

$30,000-600,000

The amount should be equal to two times the maximum amount of tax that could accrue on tax-free diesel fuel purchased or acquired or sold during a reporting period.
Compressed Natural Gas (CNG)/Liquefied

Natural Gas (LNG)

 

$30,000-600,000

The amount should be equal to two times the maximum amount of tax that could accrue on CNG or LNG produced, purchased, acquired, sold or delivered during a reporting period.
 

Dyed Diesel Fuel Bonded User

 

$10,000-$600,000

The amount should be equal to two times the maximum amount of tax that could accrue on tax-free diesel fuel purchased or acquired during a reporting period.

 

 

How can I obtain this bond?

By seeking the help of a surety bond company such as Surety Bond Authority. We can guide you through the whole bonding process with ease.

Talk to us today!

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