A fuel tax bond is a bond required from companies that deal in motor fuel. It promises you will pay the fuel taxes you owe to the state or federal government.
- Who needs it
- Fuel distributors, suppliers, blenders, importers
- Typical bond amount
- Set by the state, based on fuel volume
- What you pay
- A small percent of the bond amount, based on credit
- Term
- One year, renewable
- A claim protects
- The state or federal tax agency
What is a Fuel Tax Bond?
A fuel tax bond protects the government. Fuel is taxed, and if you sell, blend, or import it, you owe those taxes. The bond promises you will pay. If you do not, the government can file a claim.
Fuel taxes add up fast, so these bonds help make sure the money is there.
Who needs a Fuel Tax Bond?
Fuel distributors, suppliers, blenders, and importers often need one. Trucking companies that report fuel use under IFTA may need one too.
Your state revenue office or the federal government sets the amount, based on how much fuel you handle.
How does a Fuel Tax Bond work?
The path looks like this:
- The state or federal agency sets the bond amount, based on your fuel volume.
- You buy the bond from Junno Surety for a yearly premium.
- You file the bond with your fuel tax license.
- You report and pay your fuel taxes on time.
- If you fail to pay, the agency files a claim against the bond.
On-time tax filing keeps your bond claim free and your license active.
How much does a Fuel Tax Bond cost?
You pay a small percent of the bond amount, based on your credit and the size of the bond. Junno Surety prices at the industry rate minus 5%.
Because these bonds can be large, even a small saving on the rate helps. We will shop our markets for your best price.
What happens if someone files a claim?
A claim happens when you owe fuel tax and do not pay it. The agency files a claim, the bond pays the unpaid tax up to the bond amount, and then you repay the bond company.
How to get your Fuel Tax Bond from Junno Surety
Junno Surety handles fuel tax bonds of many sizes. Send us your state and the required amount, and we will get you a fast, fair quote.
We are a licensed surety bond agency and can often issue your fuel tax bond the same day. Start your free quote → or call (762) 499-0237.
Things to know about a Fuel Tax Bond
Fuel tax bonds can be large, because fuel taxes add up fast. That means your credit and your business numbers matter when we set your rate. Strong credit and clean books get you the best price. The amount is based on how much fuel you handle, so a growing business may see a larger bond at renewal. Keep careful fuel and tax records, and file on time every period. Many fuel sellers also report under IFTA, an agreement that simplifies fuel taxes across states. Whatever your setup, on-time filing keeps your license active and your bond claim free. We will shop our markets to find your best rate.
Frequently asked questions
Who needs a fuel tax bond?
Companies that distribute, supply, blend, or import fuel, and some trucking firms that report fuel use under IFTA.
How is the amount set?
The state or federal agency bases it on how much fuel you handle. More volume means a larger bond.
How much does it cost?
A small percent of the bond amount, based on your credit. We price at the industry rate minus 5%.
What is IFTA?
IFTA is the International Fuel Tax Agreement. It lets trucking companies report fuel taxes for many states on one return. Some IFTA accounts require a bond.
Why is my fuel tax bond so large?
The amount is based on the fuel taxes you are expected to owe. Since fuel taxes are high, the bond amount can be high too.