Wis. Admin. Code § Tax 4.54 — Security requirements

Tax 4.54(1) (1) General. Under ss. 78.11 , 78.48 (9) and 78.57 (9) , Stats., the department may require motor vehicle fuel, alternate fuel and general aviation fuel taxpayers to deposit security with the department. This security may be required before or after the fuel tax license is issued. The amount of security determination shall be made by the department. If any person fails or refuses to place the security, the department may refuse to issue the license or may revoke the license.

Tax 4.54(2) (2) Factors for department’s consideration.

Tax 4.54(2)(a) (a) In determining whether security shall be required and the amount of security to be required, the department shall consider all relevant factors, including:

Tax 4.54(2)(a)1. 1. Evidence of adequate financial responsibility. The evidence may include a person’s assets and liabilities, liquidity of assets, estimated expenditures and potential fuel tax liability.

Tax 4.54(2)(a)2. 2. The person’s prior record of filing tax returns and paying taxes of any kind with the department.

Tax 4.54(2)(a)3. 3. Type of entity making the sales of motor vehicle fuel, alternate fuel and general aviation fuel.

Tax 4.54(2)(b) (b) Although the individual factors listed in par. (a) shall be considered in determining security requirements, each case shall be determined on its merits as evaluated by the department. Protection of the fuel tax revenues shall be the major consideration in determining security requirements. However, due consideration shall be given to reasonable evidence that security is not necessary.

Tax 4.54(2)(c) (c) In instances in which the department determines security in excess of $1,000 is required, notification of this requirement shall include a written statement clearly describing the reasons for the requirement and a description or calculation showing how the amount of the security requirement was determined.

Tax 4.54(3) (3) Types of security. Acceptable types of security include noninterest-bearing cash, certified check, money order, or surety bonds issued by authorized underwriters.

Tax 4.54(4) (4) Determination of amount.

Tax 4.54(4)(a) (a) If security is required, the amount shall be equal to the depositor’s average quarterly Wisconsin fuel tax liability increased to the next highest even $100 amount, unless the department determines under sub. (2) that for good cause a higher amount is appropriate. The estimate of the depositor’s average quarterly fuel tax liability shall be based on whichever of the following the department considers most appropriate in the circumstances:

Tax 4.54(4)(a)1. 1. The depositor’s previous fuel tax liability.

Tax 4.54(4)(a)2. 2. The depositor’s predecessor’s fuel tax liability.

Tax 4.54(4)(a)3. 3. The estimated tax liability shown on the application for a license.

Tax 4.54(4)(a)4. 4. Other factors, such as the department’s estimate of tax liability based on its experience with other similar activities.

Tax 4.54(4)(b) (b) If at the time of the security review the person has an outstanding fuel tax delinquency, the delinquent amount shall be added to the estimated average quarterly fuel tax liability and the sum of the two shall be the amount of security required.

Tax 4.54(5) (5) Return of deposit.

Tax 4.54(5)(a) (a) Any security deposited shall be returned to the taxpayer if the taxpayer has, for 24 consecutive months, complied with all the requirements of ch. 78 , Stats.

Tax 4.54(5)(b) (b) The 24-month compliance requirement described in par. (a) shall begin on the day the deposit is received by the department.

Tax 4.54(5)(c) (c) Within 30 days after the conclusion of the 24-month period described in par. (a) , the department shall review the taxpayer’s compliance record. If the taxpayer has complied with ch. 78 , Stats., the department shall within 60 days after the expiration of the 24-month period certify the deposit for refund.

Tax 4.54(5)(d) (d) Compliance with ch. 78 , Stats., means that:

Tax 4.54(5)(d)1. 1. Fuel tax reports are timely filed.

Tax 4.54(5)(d)2. 2. All payments are made when due.

Tax 4.54(5)(d)3. 3. No penalties due to negligence or fraud are assessed for filing periods within the 24-month compliance period.

Tax 4.54(5)(d)4. 4. No assessment of additional tax, interest or other charges for filing periods within the 24-month compliance period is unpaid at the end of the period.

Tax 4.54(5)(d)5. 5. No delinquencies of fuel tax, interest or other charges imposed under ch. 78 , Stats., exist with the department.

Tax 4.54(5)(e) (e) If a taxpayer does not meet the compliance requirements set forth in par. (d) , the deposit shall be retained by the department until the taxpayer is in compliance for 24 consecutive months from the date of the latest incident of noncompliance.