taxes

Hotel Occupancy Tax - Filing for a Refund

Before filing for a refund, determine which of the following applies to you.

  • I am the seller of the taxable item and I hold a Texas hotel tax permit (read more on our permitted seller webpage).
  • I am filing for a federal government entity or a state agency that does not use USAS to reimburse employee travel expenses (submit Form 12-104, Texas Claim for Refund of State Hotel Occupancy Tax (PDF) (Form 00-985 not required);
  • I am a purchaser who does not have a hotel tax permit. If you do not hold a Texas hotel tax permit and you are the purchaser, you must first ask the seller for a refund of any tax paid in error. The seller can either grant the refund or give you Form 00-985, Assignment of Right to Refund (PDF), which allows you to file a refund claim directly with the Comptroller.

You also need to ensure the refund you are requesting is within the statute of limitations (the amount of time a person has to request a refund; generally, within four years from the date the tax was due and payable).

Note: If the Comptroller is currently auditing you for hotel tax that was overpaid, ask the auditor about including any refund in the audit. This may decrease the penalty and interest assessed in the audit and increase your refund.

Refund Claim Requirements

To request a refund from the Comptroller’s office, you must:

  • submit a claim in writing that states fully and in detail each reason or ground on which the claim is founded (Form 00-957, Texas Claim for Assigned Refund (PDF));
  • identify the period during which the claimed overpayment was made; and
  • submit the claim within the applicable limitations period, generally within four years from the date the tax was due and payable.

You may also need to provide the following:

  • If anyone other than the person or entity to whom the refund is due (such as an accountant or attorney) files a refund claim, submit Form 01-137, Limited Power of Attorney (PDF).
  • If the person seeking a refund of tax they paid is not the person who remitted the tax to the Comptroller’s office, submit Form 00-985, Assignment of Right to Refund (PDF). A separate form is required for each vendor to whom the tax was paid in error, and each form must be signed by authorized personnel.
Statute of Limitations

Generally, a person or business has four years from the date on which the tax was due and payable to make a refund claim. A state agency may apply for a refund of state hotel tax no later than two years after the end of the fiscal year in which the travel occurred as provided by Government Code, Chapter 403, Subchapter E. However, the statute of limitations (the amount of time a person has to request a refund) may be extended if:

  • An Agreement to Extend Period of Limitation is executed. This extends the time to file a refund request and is generally signed during an audit of your books and records.
  • Indicated by a completed audit or examination of your books and records. This is described in our publication Contesting Disagreed Audits, Examinations and Refund Denials (PDF) under “Your Options After Receiving A Texas Notification of Audit Results or Texas Notification of Exam Results.”

The statute of limitations keeps running unless a tolling event occurs. The statute of limitations is tolled (the clock stops running) when all refund claim requirements are met.

Submitting a Refund Claim

To file your claim electronically, email your request to refundreq.revacct@cpa.texas.gov or mail it to:

Texas Comptroller of Public Accounts
Attn: Sales and Motor Vehicle Tax Refunds
111 E. 17th Street
Austin, TX 78774-0100

If you have questions about filing a refund claim or about a claim you have already submitted, call the Comptroller’s office at 1-800-531-5441, ext. 34545.

Refund Claim Review and Supporting Documentation

The Comptroller’s office uses supporting documentation to verify refund claims and can request additional information for each transaction during the verification process. The items can include, but are not limited to:

  • purchaser or seller’s name and address;
  • copy of the hotel folio, billing statement or invoice, if applicable;
  • date(s) of lodging;
  • specific reason for the refund, such as statutory authority;
  • amount of state, municipal and county hotel tax paid separately stated;
  • name of employee, if tax reimbursed on travel voucher;
  • general ledger;
  • exemption certificates;
  • total amount of state hotel tax refund requested;
  • proof of payment;
  • executed contracts;
  • name of city where hotel is located; and
  • canceled checks or credit memo acceptance forms as proof that tax a seller collected in error was refunded to the customer(s).

If the Comptroller’s office requests that you submit invoices and you have more than 10, please provide these in a schedule format. Use the sample schedule (PDF) as a guide.

Refund Claim Outcomes

There are three possible outcomes to a refund claim: approved, incomplete or denied/partially denied.

Approved Claims

After the Comptroller’s office has approved a refund claim, we will mail a refund check to the person or entity entitled to the refund. Factors such as the timely filing discount, penalties, credit interest or an existing liability can affect the refund amount.

We will send a refund check unless the claimant is set up to receive refunds by direct deposit. If you have not already been set up for direct deposit, contact the Revenue Accounting Division at 512-463-4561 to obtain Form 74-221, Tax Refund Direct Deposit Authorization to initiate the process to receive payments electronically.

Incomplete Claims

The statute of limitations will not be tolled (does not end) until a refund claim includes all of the required elements. The Comptroller’s office will notify the claimant of the additional information needed.

Denied or Partially Denied Claims

The Comptroller’s office will notify the claimant if the refund cannot be granted in full or in part and will identify the reason(s) for the denial. The claimant can contest the denial by requesting a refund hearing within 30 days of the denial.

If a refund hearing is requested timely, the Comptroller’s office can issue a written demand notice for all documentation needed to verify the claim. This documentation must be submitted within 180 days of the date of the demand notice. Documents not timely submitted as requested by the demand notice cannot be introduced as evidence in a refund hearing.