IRS Wrongly Revoked Fuel Distributor’s Tax Exemption, Judge Says

The IRS wrongly axed a Florida fuel distributor’s tax-exempt registration in 2020 after the company failed to respond to unrelated agency inquiries, not because it failed to meet the requirements for the vendor status in question, a federal judge said.

Pro Energy LLC’s “ultimate vendor” registration—which allows a company to pursue excise tax refunds for sales to tax-exempt entities under the Internal Revenue Code—was revoked in 2020. Judge Jacqueline Becerra for the US District Court for the Southern District of Florida said the repeal was arbitrary and capricious because the record showed the IRS based its decision on the company’s ...