Highway use tax evasion projects
In this section, the term “State” means the 50 States and the District of Columbia.
The Secretary shall carry out highway use tax evasion projects in accordance with this subsection.
From administrative funds made available under section 104(a), the Secretary may deduct such sums as are necessary, not to exceed $4,000,000 for each of fiscal years 2016 through 2020, to carry out this section.
Funds made available to carry out this section may be allocated to the Internal Revenue Service and the States at the discretion of the Secretary, except that of funds so made available for each fiscal year, $2,000,000 shall be available only to carry out intergovernmental enforcement efforts, including research and training.
Allocation of funds.—
Except as otherwise provided in this section, the Secretary shall not impose any condition on the use of funds allocated to the Internal Revenue Service under this subsection.
Conditions on funds allocated to internal revenue service.—
Limitation on use of funds.—
Funds made available to carry out this section shall be used only—
to expand efforts to enhance motor fuel tax enforcement;
to fund additional Internal Revenue Service staff, but only to carry out functions described in this paragraph;
to supplement motor fuel tax examinations and criminal investigations;
to develop automated data processing tools to monitor motor fuel production and sales;
to evaluate and implement registration and reporting requirements for motor fuel taxpayers;
to reimburse State expenses that supplement existing fuel tax compliance efforts;
to analyze and implement programs to reduce tax evasion associated with other highway use taxes;
to support efforts between States and Indian tribes to address issues relating to State motor fuel taxes; and
to analyze and implement programs to reduce tax evasion associated with foreign imported fuel.
The Secretary may not make an allocation to a State under this subsection for a fiscal year unless the State certifies that the aggregate expenditure of funds of the State, exclusive of Federal funds, for motor fuel tax enforcement activities will be maintained at a level that does not fall below the average level of such expenditure for the preceding 2 fiscal years of the State.
Maintenance of effort.—
The Federal share of the cost of a project carried out under this subsection shall be 100 percent.
Funds authorized to carry out this section shall remain available for obligation for a period of 3 years after the last day of the fiscal year for which the funds are authorized.
Period of availability.—
In addition to funds made available to carry out this section, a State may expend up to ¼ of 1 percent of the funds apportioned to the State for a fiscal year under section 104(b)(2) on initiatives to halt the evasion of payment of motor fuel taxes.
Use of surface transportation block grant program funding.—
The Commissioner of the Internal Revenue Service and each State shall submit to the Secretary, the Committee on Transportation and Infrastructure of the House of Representatives, and the Committee on Environment and Public Works of the Senate an annual report that describes the projects, examinations, and criminal investigations funded by and carried out under this section. Such report shall specify the estimated annual yield from such projects, examinations, and criminal investigations.
Excise Tax Fuel Reporting.—
Not later than 90 days after the date of enactment of the SAFETEA–LU, the Secretary shall enter into a memorandum of understanding with the Commissioner of the Internal Revenue Service for the purposes of—
the additional development of capabilities needed to support new reporting requirements and databases established under such Act and the American Jobs Creation Act of 2004 (Public Law 108–357), and such other reporting requirements and database development as may be determined by the Secretary, in consultation with the Commissioner of the Internal Revenue Service, to be useful in the enforcement of fuel excise taxes, including provisions recommended by the Fuel Tax Enforcement Advisory Committee,
the completion of requirements needed for the electronic reporting of fuel transactions from carriers and terminal operators,
the operation and maintenance of an excise summary terminal activity reporting system and other systems used to provide strategic analyses of domestic and foreign motor fuel distribution trends and patterns,
the collection, analysis, and sharing of information on fuel distribution and compliance or noncompliance with fuel taxes, and
the development, completion, operation, and maintenance of an electronic claims filing system and database and an electronic database of heavy vehicle highway use payments.
Elements of memorandum of understanding.—
The memorandum of understanding shall provide that—
the Internal Revenue Service shall develop and maintain any system under paragraph (1) through contracts,
any system under paragraph (1) shall be under the control of the Internal Revenue Service, and
any system under paragraph (1) shall be made available for use by appropriate State and Federal revenue, tax, and law enforcement authorities, subject to section 6103 of the Internal Revenue Code of 1986.
Of the amounts made available to carry out this section for each fiscal year, the Secretary shall make available to the Internal Revenue Service such funds as may be necessary to complete, operate, and maintain the systems under paragraph (1) in accordance with this subsection.
Not later than September 30 of each year, the Commissioner of the Internal Revenue Service shall provide reports to the Secretary on the status of the Internal Revenue Service projects funded under this subsection.
(Added Pub. L. 91–605, title I, § 127(a), Dec. 31, 1970, 84 Stat. 1729; amended Pub. L. 93–87, title I, § 122, Aug. 13, 1973, 87 Stat. 261; Pub. L. 105–178, title I, § 1114(a), (c), June 9, 1998, 112 Stat. 152; Pub. L. 105–206, title IX, § 9002(h), July 22, 1998, 112 Stat. 836; Pub. L. 109–59, title I, § 1115(a), (b), Aug. 10, 2005, 119 Stat. 1175, 1176; Pub. L. 112–141, div. A, title I, § 1110, July 6, 2012, 126 Stat. 444; Pub. L. 114–94, div. A, title I, § 1110, Dec. 4, 2015, 129 Stat. 1344.)