41A.01.110 Commissioner to Audit Report and Assess Tax

(a) The Commissioner, or an authorized representative, may audit the records, books, and papers and examine fuel and any equipment used to store, transport, or dispense fuel, or a refiner, supplier, distributor, importer, exporter, terminal operator, retailer, or common or contract carrier. For a person required to file a report, the examination and audit must be done no later than three years after the due date of a report, or three years after the report was filed, whichever period expires later. The Commissioner is authorized to make assessments of tax, plus penalty and interest, or to issue credit or refunds as determined on the basis of the examination and audit.

(b) If it is determined upon audit that the tax due was twenty-five percent or more above the amount reported on a report, the tax may be assessed, or a proceeding in court or the collection of the tax may be begun without such assessment, at anytime within six years after the due date of the report, or six years after the reports was filed, whichever period expires later.

(c) Except as otherwise provided in this chapter, the Commissioner may audit any consumer's claim for a refund of tax, and, not later than three years after the due date of the claim or three years after the claim was filed, whichever period expires later, assess additional tax or issue an additional refund. If additional tax is found due or if an additional tax refund applies, the Commissioner shall notify the claimant in detail of the reason for the increase or decrease. For any claim selected for audit, the claimant shall provide additional verification as required by the Commissioner of fuel purchases, payment of the tax, use of the fuel for a purpose entitling the claimant to a refund, and use of the fuel other than in a licensed motor vehicle.

(d) If a person gives false or fraudulent information in a tax report or in a claim for refund, or if the failure by a person to file a tax report due to the fraudulent intent or the willful attempt of the person to file a tax report is due to the fraudulent intent or the willful attempt of the person in any manner to evade the tax, the time limitations in this section do not apply, and the tax may be assessed, or a proceeding in court for the collection of the tax may be begun without such assessment, at any time.

(e) If, before the expiration of the time prescribed in this chapter for the assessment of tax, the Commissioner and the person consent in writing to the extension of time for the assessment of the tax, the tax may be assessed at any time prior to the expiration of the period agreed upon. The period agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.

(f) A determination of additional tax due issued to a person fixes the tax finally and irrevocably unless the person against whom it is assessed, within thirty days after the giving of notice of the determination, protests the determination under rules adopted by the Tax Commission.

(g) A determination that a claim for a tax credit or refund is disallowed becomes finally and irrevocably fixed unless the person claiming the refund, and within thirty days after the giving of notice of the determination, protests the determination under rules adopted by the Tax Commission.