Dyed diesel

What is dyed diesel?

Dyed diesel (also known as marked fuel, farm fuel, or "red-dyed" diesel) is fuel with red dye added to indicate there are no federal or state fuel taxes paid. It's commonly used for non-highway farming equipment, construction equipment, generators, and marine vessels.

Using dyed diesel

Dyed diesel users must have a license for on-road use. This license allows approved government agencies and organizations to use dyed special fuel (diesel or biodiesel) when operating licensed motor vehicles on public roadways.

Legal non-highway use

• Tractors and farm equipment ("Q" decal vehicles) used within 25 miles of the registered address
• Construction equipment
• Stationary engines, such as a generator or welders
• Marine vessels

Illegal use

It's illegal to use dyed diesel in vehicles that drive on Washington public roadways or highways. Examples of illegal use include:

• Operating a farm vehicle, registered with a "Q" decal, with dyed diesel beyond the 25-mile radius
• Having dyed diesel in the fuel tank of a licensed vehicle
• Fueling a licensed vehicle with dyed diesel from your bulk storage tank (both the vehicle and the tank are subject to penalties)
• Using a farm vehicle that's registered in Canada and filled with marked fuel on U.S. highways

Penalties for illegal use of dyed diesel

If you illegally use dyed diesel, you must pay a fine of $10/gallon or $1,000 per tank, whichever is greater.

Penalty examples

• If you have 3 registered vehicles, each with a 20-gallon capacity, you could face a fine of $3,000. (3 vehicles x $1,000 minimum fine = $3,000)
• If you fuel a licensed vehicle from your own 150-gallon dyed diesel slip tank or bulk storage tank, you could face a fine for both the tank and the vehicle:
  • $1,500 for the bulk storage tank ($10 x 150 gallons = $1,500), and
  • $1,000 for the vehicle tank ($1,000 minimum fine)
• Each additional time you use dyed diesel illegally, you will be subject to an increased penalty.

Fuel tax evasion

We partner with Washington State Patrol (WSP) to enforce fuel taxes.

How to report suspected fuel tax evasion

You can report fuel tax evasion by:

• Phone: 800-497-3835 (800-497-FUEL)
• Email: evasion@dol.wa.gov
• Mail to:
  Fuel Tax Unit
  Department of Licensing
  PO Box 9228
  Olympia, WA 98507-9228

Refund for tax-paid non-dyed (clear) diesel

If you paid at least $20 in fuel taxes in the last 13 months, you may be eligible for a refund if you used the fuel for:

• Boating
• Construction
• Farming
• Logging
• Landscape or lawn maintenance
• Export
• Auxiliary equipment (such as the dumping mechanism on a dump truck or the boom on a boom truck)

Visit the fuel tax refunds page to see if you qualify.

More information about dyed diesel

• Attention truckers: No dyed fuel in highway vehicles
• IRS publication 510: Excise taxes (including fuel tax credits and refunds)
• Internal Revenue Services (IRS) website

Related laws and rules

• Fuel tax account (RCW 82.38)
• Fuel tax rules and regulations (WAC 308–77)

Related information

• Fuel tax refund (includes rates per gallon)
• Fuel licenses: Dyed diesel user
• Reports and data: Licensed dyed diesel users