Texas – Refund Claim Regulation Declared Illegal and Invalid

SALT Report 2579 – A Travis County District Court Judge has ruled that certain provisions of the Texas regulation regarding sales tax refunds are invalid and illegal. The Judge found that the rule created additional burdens, conditions, and restrictions on tax refund claims that exceed the Comptroller’s authority as well as the provisions in the Texas sales tax refund statute §111.104.

Specifically, the Judge declared that the following rule and subsections, in effect since January 7, 2013, are invalid:

  • Rule §3.325(a)(4) – Refund request requirements
  • Rule §3.325 (b)(10) – Requirements to toll the statute of limitations, and
  • Rule §3.325 (e) – Denial of refund claims

The Comptroller plans to appeal the Judge’s decision, and as a result, the Rule and the subsection noted above will not go into effect until the issue has been fully litigated.

For Further Information

Texas Comptroller of Public Accounts – District Court Ruling

Texas Attorney General – Comptroller of Public Accounts Case List and Summary of Issues, page 85

Texas Administrative Code – Rule 3.325