presented a compelling reason for doing so. The mistake that occurred was a byproduct
of the taxpayer’s failure to maintain proper records, and the “cost” of that mistake cannot
be attributed to the Department.
In addition, at this time the Department cannot be required to pay the taxpayer
interest on the overpayment that the taxpayer made to Illinois.
regulation concerning credits and refunds states that for IFTA licensees, the licensee may
apply the overpayment that was generated in one jurisdiction to the taxes owed to another
jurisdiction. 86 Ill.Admin.Code §500.340(a). “Credits and refunds will be made only
when all tax liability, including audit assessments, has been paid to the Department or
when all motor fuel use tax liabilities, including audit assessments, penalty and interest
owed to other jurisdictions, has been satisfied.”
86 Ill.Admin.Code §500.340(c).
“Refunds determined to be properly due shall be paid within 90 days after receipt of a
request by the licensee. If not so paid, interest shall accrue at the rate of 1 percent per
month or fraction thereof until the refund is paid.” 86 Ill.Admin.Code §500.340(e).
The taxpayer’s overpayment to Illinois was applied to the taxpayer’s motor fuel
use tax liability that was owed to other jurisdictions. Because the overpayment was
applied to other liabilities, the taxpayer has not specifically requested a refund. If the
taxpayer had requested a refund, and if it was established that a refund was properly due
to the taxpayer, and if the Department did not pay the refund within 90 days after receipt
of the request, then interest would accrue at the rate of 1 percent per month or fraction
thereof. None of these conditions have been met in this case.