…
Because Taxpayer's tank was divided into three compartments, the IDEM concluded
that Taxpayer should have paid three fees each year. The Department issued proposed
assessments June 23, 2010, assessing two additional fee amounts for each of the
years 1994 through 2009.
…
Taxpayer maintains that IDEM and the Department belatedly and
improperly assessed the additional fees.
Taxpayer states that it had been told by IDEM personnel that it was only
required to remit one fee each year.
IC §13-23-12-1 imposes a fee on underground storage tanks.
Although the IDEM regulates underground storage tanks for the State, IC §
13-23-12-4 mandates that the Department of Revenue collect and deposit the underground
storage tank fees.
…
Because the fee is collected by the Department of Revenue
(Department) and is a listed tax under IC § 6-8.1-1-1, the assessment of the
fees is governed by IC § 6-8.1-5-2(a) which states: Except as otherwise provided in this section,
the department may not issue a proposed assessment under section 1 of this
chapter more than three (3) years after the latest of the date the return is
filed, or either of the following: (1)
The due date of the return. (2) In the
case of a return filed for the state gross retail or use tax, the gasoline tax,
the special fuel tax, the motor carrier fuel tax, the oil inspection fee, or
the petroleum severance tax, the end of the calendar year which contains the
taxable period for which the return is filed.
The three-year statute of limitations applies in the absence of
proof of fraud by clear and convincing evidence or a taxpayer's failure to file
a return. See IC § 6-8.1-5-2(f).
Although IC § 13-23-12-1(c) plainly states that Taxpayer should
have been paying the fee on three tanks, there is no "clear and convincing
evidence" that Taxpayer intended to perpetrate a fraud when it reported
that it owed one underground tank and that it paid one single fee each year.
Therefore, the fees assessed for 1994, 1995, 1996, 1997, 1998, 1999, 2000,
2001, 2002, 2003, 2004, 2005, and 2006, are barred by the three-year statute of
limitations because the fees due for 2006 were due at the end of the calendar
year and because Taxpayer filed returns for each of these years. Nonetheless,
because the proposed assessments were issued June 23, 2010, the Department was
justified in issuing proposed assessments for 2009, 2008, and 2007. (It should
be noted that if the situation were reversed – Taxpayer had for sixteen years
been paying fees for three tanks when it in fact owned one – Taxpayer would be
similarly barred from requesting a refund of the excess fees by the three-year
statute of limitations under IC § 6-8.1-9-1(a)).
However, Taxpayer is admonished that if all the environmental fees
are not paid in full, Taxpayer or any future owner will not be eligible for
full payments from the Excess Liability Trust Fund (ELTF) in the event that there
is a gasoline spill or other environmental problem resulting from Taxpayer's
underground storage tanks.
