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Title 26, Internal Revenue CodeRelease 119-110

§6715 Dyed Fuel Sold for Use or Used in Taxable Use, Etc.

Title 26 › Subtitle F — Procedure and Administration › CHAPTER 68 — ADDITIONS TO THE TAX, ADDITIONAL AMOUNTS, AND ASSESSABLE PENALTIES › Subchapter B — Assessable Penalties › PART I — GENERAL PROVISIONS › § 6715

Last updated Sep 22, 2026|Official source

Summary

People must pay a penalty if they sell, hold, use, or change dyed fuel in ways that show they knew (or should have known) the fuel was not for a tax-free use, or if they willfully alter the dye or marking. The penalty for each wrong act is the larger of $1,000 or $10 for each gallon involved. If the person has had prior penalties under this rule, the $1,000 amount is increased by $1,000 times the number of earlier penalties. The penalty is in addition to any tax owed. Officers, employees, or agents who took part on purpose in the bad act are also responsible for the penalty along with the business. If someone has already been penalized at least twice since this rule took effect and a chemical test finds a violation, they cannot ask for an administrative appeal except to claim fraud or a mistake in the chemical test or a math error in the penalty calculation. Dyed fuel means dyed diesel fuel or kerosene. Nontaxable use means what section 4082(b) says.

Full Legal Text

Title 26, §6715

Internal Revenue Code, Source: USLM XML via OLRC

(a)Imposition of penalty
If—
(1)any dyed fuel is sold or held for sale by any person for any use which such person knows or has reason to know is not a nontaxable use of such fuel,
(2)any dyed fuel is held for use or used by any person for a use other than a nontaxable use and such person knew, or had reason to know, that such fuel was so dyed,
(3)any person willfully alters, chemically or otherwise, or attempts to so alter, the strength or composition of any dye or marking done pursuant to section 4082 in any dyed fuel, or
(4)any person who has knowledge that a dyed fuel which has been altered as described in paragraph (3) sells or holds for sale such fuel for any use which the person knows or has reason to know is not a nontaxable use of such fuel,
then such person shall pay a penalty in addition to the tax (if any).
(b)Amount of penalty
(1)In general
Except as provided in paragraph (2), the amount of the penalty under subsection (a) on each act shall be the greater of— (A)
(B)$10 for each gallon of the dyed fuel involved.
(2)Multiple violations
In determining the penalty under subsection (a) on any person, paragraph (1) shall be applied by increasing the amount in paragraph (1)(A) by the product of such amount and the number of prior penalties (if any) imposed by this section on such person (or a related person or any predecessor of such person or related person).
(c)Definitions
For purposes of this section
(1) Dyed fuel
(2)Nontaxable use
The term “nontaxable use” has the meaning given such term by section 4082(b).
(d)Joint and several liability of certain officers and employees
If a penalty is imposed under this section on any business entity, each officer, employee, or agent of such entity who willfully participated in any act giving rise to such penalty shall be jointly and severally liable with such entity for such penalty.
(e)No administrative appeal for third and subsequent violations
In the case of any person who is found to be subject to the penalty under this section after a chemical analysis of such fuel and who has been penalized under this section at least twice after the date of the enactment of this subsection, no administrative appeal or review shall be allowed with respect to such finding except in the case of a claim regarding—
(1)fraud or mistake in the chemical analysis, or
(2)mathematical calculation of the amount of the penalty.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

References in Text

The date of the enactment of this subsection, referred to in subsec. (e), is the date of enactment of Pub. L. 108–357, which was approved Oct. 22, 2004.

Amendments

2004—Subsec. (a)(2). Pub. L. 108–357, § 856(a), which directed amendment of par. (2) by striking “or”, was executed by striking “or” at the end. Subsec. (a)(3). Pub. L. 108–357, § 856(b), substituted “alters, chemically or otherwise, or attempts to so alter,” for “alters, or attempts to alter,”. Pub. L. 108–357, § 856(a), inserted “or” at end. Subsec. (a)(4). Pub. L. 108–357, § 856(a), added par. (4). Subsec. (e). Pub. L. 108–357, § 855(a), added subsec. (e). 1997—Subsec. (c)(1). Pub. L. 105–34 inserted “or kerosene” after “diesel fuel”. 1996—Pub. L. 104–188 renumbered section 6714 of this title as this section.

Statutory Notes and Related Subsidiaries

Effective Date

of 2004 Amendment Pub. L. 108–357, title VIII, § 855(b), Oct. 22, 2004, 118 Stat. 1616, provided that: “The amendment made by this section [amending this section] shall apply to penalties assessed after the date of the enactment of this Act [Oct. 22, 2004].” Pub. L. 108–357, title VIII, § 856(c), Oct. 22, 2004, 118 Stat. 1617, provided that: “The

Amendments

made by this section [amending this section] shall take effect on the date of the enactment of this Act [Oct. 22, 2004].”

Effective Date

of 1997 AmendmentAmendment by Pub. L. 105–34 effective July 1, 1998, see section 1032(f)(1) of Pub. L. 105–34, as amended, set out as a note under section 4041 of this title.

Effective Date

Section effective Jan. 1, 1994, see section 13242(e) of Pub. L. 103–66, set out as an

Effective Date

of 1993 Amendment note under section 4041 of this title.

Reference

Citations & Metadata

Citation

26 U.S.C. § 6715

Title 26, Internal Revenue Code

Last Updated

Sep 22, 2026

Release point: 119-110