<<Prev Rule Texas Administrative Code Next Rule>>

TITLE 34 PUBLIC FINANCE

PART 1 COMPTROLLER OF PUBLIC ACCOUNTS
CHAPTER 3 TAX ADMINISTRATION
SUBCHAPTER O STATE SALES AND USE TAX
RULE §3.325 Refunds, Interest, and Payments Under Protest
(a) Tax paid to state. Any person, his attorney, assignee, executor, or administrator may request from the
comptroller a refund of any tax remitted to the state but that was not due.
(1) A claim for refund of an amount paid pursuant to a deficiency determination is timely for all transactions
that are included in the deficiency determination if made in accordance with subparagraphs (B) or (C) of this
paragraph. A claim for refund for items that are not included in a deficiency determination must be made in
accordance with subparagraph (A) of this paragraph. The refund request must be made within:
(A) four years from the date on which the tax was due and payable as defined in Tax Code, §151.401; or
(B) six months after a determination for the periods for which refund is claimed becomes final; or
(C) six months after any determination would have become final had payment not been made before the due
date.
(2) Before the expiration of the statute of limitations, the comptroller and a taxpayer may agree in writing to an
extension of the statute of limitations.
(3) An extension of the statute of limitations applies only to the periods that are specified in the agreement. Any
assessment or refund request that pertains to periods for which limitations have been extended must be made
prior to the expiration date of the agreement. Following expiration of the agreement, the statute of limitations
applies to subsequent assessments and refund requests as if no extension had been agreed.
(4) The request for refund must be made in writing and must state the specific grounds upon which the claim is
founded. The request must also indicate the period for which the claimed overpayment was made.
(5) In determining the statute of limitations for filing a refund claim, the time during which an administrative
proceeding is pending before the comptroller for the same period is not counted. A taxpayer may not file a sales
tax refund claim for the same transaction and for the same time period as a refund claim previously denied.
(6) Failure to file a claim within the limitation prescribed by this section constitutes a waiver of any demand
against the state on account of the overpayment.
(b) Tax paid to seller. A person who remits tax to a permitted seller may request from the seller or the
comptroller a refund of Texas tax paid in error. The following procedures must be used.
(1) Seller who requests a refund from the comptroller.
(A) Before a seller refunds to a purchaser tax collected in error, the seller must obtain from the purchaser a
properly completed exemption or resale certificate that meets all the requirements of §3.285 of this title (relating
to Sales for Resale; Resale Certificate) and §3.287 of this title (relating to Exemption Certificates). The seller
must retain the certificate to document the basis for the refund.
(B) After the seller has refunded or, with the purchaser's written consent, credited the tax to the account of the
purchaser, the seller may then seek reimbursement from the state in accordance with the procedures that are
outlined in subsection (a) of this section or take a credit on the seller's next return in the amount refunded or
credited to the account of the purchaser.
(2) A purchaser who requests a refund from the comptroller.
(A) A purchaser who requests a refund from the comptroller must submit to the comptroller a written request
that states the basis for the refund and includes the following information:
(i) the seller's name, address, and either the sales tax permit number or information that will enable the
comptroller to identify the seller's sales tax permit number;
(ii) the invoice number, if applicable;
(iii) the date of purchase;
(iv) a description of the item purchased;
(v) the basis for the refund;
(vi) information that identifies the local taxing authorities for which tax was paid; and
 (vii) a statement or reasonable estimate of the amount of the tax refund requested.
(B) The comptroller may require a person to submit additional information to verify the refund claim. The
person must show to the satisfaction of the comptroller that the refund is due and make available to the
comptroller any documentation that the comptroller requires to process the refund.
(C) A purchaser who holds a sales and use tax permit may amend the return for the period in which the
overpayment was made or file a refund claim with the comptroller for sales tax paid in error to a seller. The
refund claim must identify the period in which the tax was originally paid. The purchaser must retain, for the
period required in Tax Code, Chapter 111, all documentation that is necessary to support the credit.
(c) Interest.
(1) Except as provided by paragraphs (2) and (3) of this subsection, in a comptroller's final decision on a claim
for refund or in an audit, interest accrues at the rate that is set in Tax Code, §111.060, on the amount that is
found to be erroneously paid:
(A) beginning on the later of 60 days after the date of payment or the due date of the tax report; and
(B) ending on, as determined by the comptroller, either:
(i) the date of allowance of credit that results from a final decision that the comptroller has issued, or from an
audit; or
(ii) a date that is not more than 10 days before the date of the refund warrant.
(2) The interest rate for a refund that is granted for a period for which a report is due after December 31, 1999,
is the rate set in Tax Code, §111.060. A refund for a period for which a report is due before January 1, 2000,
does not accrue interest.
(3) Credits taken by a taxpayer on the taxpayer's return do not accrue interest.
(4) No taxes, penalties, or interest will be refunded to a person who has collected the taxes from another person
until all taxes are first refunded to the party from whom they were collected.
(d) Payments under protest. A person who intends to file suit under Tax Code, Chapter 112, Subchapter B, must
submit to the comptroller a letter of protest with the payment of the tax that is the subject of the protest. See
subsection (e) of §3.9 of this title (relating to Electronic Filing of Returns and Reports; Electronic Transfer of
Certain Payments by Certain Taxpayers). The letter of protest must state fully and in detail every reason that the
taxpayer contends that the assessment is unlawful or unauthorized, and must accompany the payment. If the
payment and letter of protest do not accompany one another, the payment will not be deemed to have been made
under protest. For the taxpayer's convenience, the comptroller will advise the taxpayer of the amount of payment
under protest that the comptroller has received and the date of the payment.
Source Note: The provisions of this §3.325 adopted to be effective April 13, 1979, 4 TexReg 1105; amended to
be effective May 24, 1982, 7 TexReg 1750; amended to be effective February 29, 1984, 9 TexReg 1028;
amended to be effective February 2, 1987, 12 TexReg 186; amended to be effective November 19, 1987, 12
TexReg 4121; amended to be effective May 28, 2001, 26 TexReg 3823