Skip to main content

Fuels can be roughly divided into two groups: taxed and tax-exempt. Taxed fuel is used on public roads by individuals and businesses. Also known as off road fuel, dyed diesel is a special fuel that is dyed red and is limited to certain uses. You can use it when operating construction or heavy agricultural machinery, powering generators, and heating homes. It is illegal to use dyed fuel on commercial or passenger vehicles that operate on public roads.

How to use off road diesel properly

Considering the rise in fuel prices, it might be tempting to use tax-exempt fuel for public road purposes. However, before you start stocking up on tax-exempt fuel, you should know that there are heavy fines for using off road diesel for public road purposes. Also, you could lose out on tax-exemptions if you do not report that you used this fuel legally.

Off road diesel is designated only for vehicles and equipment that do not operate on public roads and highways. Dyed diesel can legally be used to power a combine or skid steer, but not the commercial truck that hauls them. Farmers and construction firms frequently use tax-exempt diesel for their cranes, bobcats, backhoes, and other heavy machinery. Dyed diesel can be used for aviation and marine purposes, to power carnival and fair rides, and even to power generators for trailers and homes.

Investigative techniques used to find illegal off road fuel

Government investigators carry field packs to test fuel and see if even trace amounts of dye are detected. If small amounts are detected, you are in violation and subject to penalties. Investigators often test fuels at safety check stations, weigh stations, agricultural shows, and other places in which commercial vehicle drivers congregate.

Penalties for using off road diesel illegally

If an investigator finds dyed fuel in your tank, you could be subject to a penalty that runs from $100 to over $1,000 for a gallon of gas. You can also end up owing excess taxes and interest for unpaid taxes to the IRS and state tax authorities. If you work for a company and are caught using off road fuel illegally, you also risk losing your job.

Acceptable uses of tax-exempt fuel on public roads

There are situations where off road diesel fuel can be used on public roads. In some instances, usually when a state of emergency has been declared by the state or federal government, dyed diesel can be used. It can also be used if the regular fuel supply has been disrupted due to a natural disaster. It is best to check with your specific areas guidelines.

Kendrick Oil carries a wide variety of fuels including clear, dyed, and winterized diesel fuel at wholesale prices. We also carry unleaded, mid-grade, and premium regular gasoline. Give us a call at (800) 299-3991 or Contact Us by email for any questions about our Products and Services. We provide services in Texas, New Mexico, Oklahoma, Kansas, Colorado, and Louisiana.