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Highway use tax evasion projects

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§143. Highway use tax evasion projects

(a) State Defined.-In this section, the term "State" means the 50 States and the District of Columbia.

(b) Projects.-

(1) In general.-The Secretary shall carry out highway use tax evasion projects in accordance with this subsection.

(2) Funding.-

(A) In general.-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.

(B) Allocation of funds.-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.

(3) Conditions on funds allocated to internal revenue service.-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.

(4) Limitation on use of funds.-Funds made available to carry out this section shall be used only-

(A) to expand efforts to enhance motor fuel tax enforcement;

(B) to fund additional Internal Revenue Service staff, but only to carry out functions described in this paragraph;

(D) to develop automated data processing tools to monitor motor fuel production and sales;

(E) to evaluate and implement registration and reporting requirements for motor fuel taxpayers;

(F) to reimburse State expenses that supplement existing fuel tax compliance efforts;

(G) to analyze and implement programs to reduce tax evasion associated with other highway use taxes;

(H) to support efforts between States and Indian tribes to address issues relating to State motor fuel taxes; and

(I) to analyze and implement programs to reduce tax evasion associated with foreign imported fuel.

(5) Maintenance of effort.-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.

(6) Federal share.-The Federal share of the cost of a project carried out under this subsection shall be 100 percent.

(7) Period of availability.-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.

(8) Use of surface transportation block grant program funding.-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.

(9) Reports.-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.

(1) In general.-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-

(A) 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,

(B) the completion of requirements needed for the electronic reporting of fuel transactions from carriers and terminal operators,

(C) 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,

(D) the collection, analysis, and sharing of information on fuel distribution and compliance or noncompliance with fuel taxes, and

(E) the development, completion, operation, and maintenance of an electronic claims filing system and database and an electronic database of heavy vehicle highway use payments.

(2) Elements of memorandum of understanding.-The memorandum of understanding shall provide that-

(A) the Internal Revenue Service shall develop and maintain any system under paragraph (1) through contracts,

(B) any system under paragraph (1) shall be under the control of the Internal Revenue Service, and

(C) 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.

(3) Funding.-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.

(4) Reports.-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 .)

Editorial Notes

References in Text

The SAFETEA–LU, referred to in subsec. (c)(1), is Pub. L. 109–59, Aug. 10, 2005, 119 Stat. 1144 , also known as the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users. For complete classification of this Act to the Code, see Short Title of 2005 Amendment note set out under section 101 of this title and Tables.

The American Jobs Creation Act of 2004, referred to in subsec. (c)(1)(A), is Pub. L. 108–357, Oct. 22, 2004, 118 Stat. 1418 , as amended. For complete classification of this Act to the Code, see Short Title of 2004 Amendments note set out under section 1 of Title 26, Internal Revenue Code, and Tables.

Section 6103 of the Internal Revenue Code of 1986, referred to in subsec. (c)(2)(C), is classified to section 6103 of Title 26, Internal Revenue Code.

Prior Provisions

Provisions similar to those in this section were contained in Pub. L. 102–240, title I, §1040, Dec. 18, 1991, 105 Stat. 1992 , as amended, which was set out as a note under section 101 of this title, prior to repeal by Pub. L. 105–178, §1114(b)(2).

Amendments

2015-Subsec. (b)(2)(A). Pub. L. 114–94, §1110(1), amended subpar. (A) generally. Prior to amendment, text read as follows: "From administrative funds made available under section 104(a), the Secretary shall deduct such sums as are necessary, not to exceed $10,000,000 for each of fiscal years 2013 and 2014, to carry out this section."

Subsec. (b)(8). Pub. L. 114–94, §1110(2), inserted "block grant" after "surface transportation" in heading.

Subsec. (b)(9). Pub. L. 114–94, §1110(3), inserted ", the Committee on Transportation and Infrastructure of the House of Representatives, and the Committee on Environment and Public Works of the Senate" after "the Secretary".

2012-Subsec. (b)(2). Pub. L. 112–141, §1110(1)(A), added par. (2) and struck out former par. (2). Prior to amendment, text read as follows: "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 of fiscal years 2005 through 2009, $2,000,000 shall be available only to carry out intergovernmental enforcement efforts, including research and training."

Subsec. (b)(8). Pub. L. 112–141, §1110(1)(B), substituted "section 104(b)(2)" for "section 104(b)(3)".

Subsec. (c)(3). Pub. L. 112–141, §1110(2), substituted "for each fiscal year," for "for each of fiscal years 2005 through 2009,".

2005-Subsec. (b)(2). Pub. L. 109–59, §1115(a)(1), inserted before period at end "; except that of funds so made available for each of fiscal years 2005 through 2009, $2,000,000 shall be available only to carry out intergovernmental enforcement efforts, including research and training".

Subsec. (b)(3). Pub. L. 109–59, §1115(a)(2), substituted "Except as otherwise provided in this section, the" for "The".

Subsec. (b)(4)(H), (I). Pub. L. 109–59, §1115(a)(3), added subpars. (H) and (I).

Subsec. (b)(9). Pub. L. 109–59, §1115(a)(4), added par. (9).

Subsec. (c). Pub. L. 109–59, §1115(b), amended heading and text of subsec. (c) generally, substituting provisions relating to memorandum of understanding to be entered into by the Secretary with the Commissioner of the Internal Revenue Service not later than 90 days after the date of enactment of the SAFETEA–LU for provisions relating to memorandum of understanding to be entered into by the Secretary with the Commissioner of the Internal Revenue Service not later than August 1, 1998.

1998-Pub. L. 105–178 amended section catchline and text generally, substituting provisions relating to highway use tax evasion projects for provisions relating to economic growth center development highways.

Subsec. (c)(1). Pub. L. 105–178, §1114(c)(1), as added by Pub. L. 105–206, §9002(h), substituted "August 1" for "April 1".

Subsec. (c)(3). Pub. L. 105–178, §1114(c)(2), (3), as added by Pub. L. 105–206, §9002(h), in heading inserted "priority" after "Funding" and in text inserted "and prior to funding any other activity under this section," after "2003,".

1973-Subsec. (a). Pub. L. 93–87, §122(a), (c), substituted "projects" for "demonstration projects" and "a Federal-aid system (other than the Interstate System)" for "the Federal-aid primary system" and deleted "to demonstrate the role that highways can play" before "to promote".

Subsec. (b). Pub. L. 93–87, §122(a), substituted "projects" for "demonstration projects" and "a Federal-aid system (other than the Interstate System)" for "the Federal-aid primary system".

Subsec. (c). Pub. L. 93–87, §122(a), substituted "project" for "demonstration project" and "a Federal-aid system (other than the Interstate System)" for "the Federal-aid primary system".

Subsec. (d). Pub. L. 93–87, §122(a), substituted "highways on the Federal-aid system on which such development highway is located" for "Federal-aid primary highways".

Subsec. (e). Pub. L. 93–87, §122(b), inserted introductory text "Except as otherwise provided in subsection (c) of this section," and substituted "the Federal share of the cost of any project for construction, reconstruction, or improvement of a development highway under this section shall be the same as that provided under this title for any other project on the Federal-aid system on which such development highway is located" for "the Federal share of the cost of any project for construction, reconstruction, or improvement of a development highway under this section shall be increased by not to exceed an additional 20 per centum of the cost of such project, except that in no case shall the Federal share exceed 95 per centum of the cost of such project".

Statutory Notes and Related Subsidiaries

Effective Date of 2015 Amendment

Amendment by Pub. L. 114–94 effective Oct. 1, 2015, see section 1003 of Pub. L. 114–94, set out as a note under section 5313 of Title 5, Government Organization and Employees.

Effective Date of 2012 Amendment

Amendment by Pub. L. 112–141 effective Oct. 1, 2012, see section 3(a) of Pub. L. 112–141, set out as an Effective and Termination Dates of 2012 Amendment note under section 101 of this title.

Effective Date of 1998 Amendment

Title IX of Pub. L. 105–206 effective simultaneously with enactment of Pub. L. 105–178 and to be treated as included in Pub. L. 105–178 at time of enactment, and provisions of Pub. L. 105–178, as in effect on day before July 22, 1998, that are amended by title IX of Pub. L. 105–206 to be treated as not enacted, see section 9016 of Pub. L. 105–206, set out as a note under section 101 of this title.

Highway Use Tax Evasion Projects

Pub. L. 102–240, title VIII, §8002(g), (h), Dec. 18, 1991, 105 Stat. 2204 , 2205, as amended by Pub. L. 105–178, title I, §1114(b)(3), June 9, 1998, 112 Stat. 154 , provided that:

"(g) Use of Revenues for Enforcement of Highway Trust Fund Taxes.-The Secretary of Transportation shall not impose any condition on the use of funds transferred under section 143 of title 23, United States Code, to the Internal Revenue Service. The Secretary of the Treasury shall, at least 60 days before the beginning of each fiscal year (after fiscal year 1992) for which such funds are to be transferred, submit a report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate detailing the increased enforcement activities to be financed with such funds with respect to taxes referred to in section 9503(b)(1) of the Internal Revenue Code of 1986 [26 U.S.C. 9503(b)(1)].

"[(h) Repealed. Pub. L. 105–178, title I, §1114(b)(3)(B), June 9, 1998, 112 Stat. 154 .]"

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