Get an Instant Quote on Motor Fuels Tax Continuous Bond – Compressed Natural Gas
Introduction
From our perspective, compressed natural gas (CNG) distributors in Texas want more than regulatory approval—they’re aiming for long-term operational consistency. The Texas – Motor Fuels Tax Continuous Bond – Compressed Natural Gas allows those operating in the CNG space to comply with state tax law while signaling financial integrity. Mandated by the Texas Comptroller of Public Accounts, this bond guarantees that all taxes, interest, and penalties tied to the sale or use of compressed natural gas are paid in full and on time.
For businesses transporting or selling CNG as a motor fuel, this bond is more than a formality—it’s a safeguard. The state wants to collect taxes on fuel as it enters commerce, and this continuous bond acts as a backstop. Whether you operate across state lines or focus on regional fueling hubs, holding this bond makes license acquisition and renewals seamless. Those already familiar with fuel compliance may also be familiar with related instruments like the Texas – Motor Fuels Tax Continuous (Gasoline) Bond, which applies to other fuel types. In either case, the purpose is the same—safeguard state revenue and keep operations compliant.
Bonding Requirements Create Confusion Without Clear Direction
We’ve noticed that many CNG suppliers don’t fully understand how the Texas bonding requirement works. Some businesses confuse it with general liability insurance or assume a one-time filing is enough. Others underestimate the bond amount required or delay filing until after beginning operations—leading to costly delays and permit suspensions.
According to Texas Tax Code §162.361(b), any person who acts as a dealer, supplier, or user of compressed natural gas must file a continuous bond. This bond must equal twice the maximum tax liability for a reporting period, with a typical minimum amount of $30,000. Without this bond, the Comptroller will not issue or renew permits—and any CNG distribution would be unauthorized.
The misunderstanding doesn’t end at filing. Even businesses that secure the correct bond often fail to update it as sales volumes change, putting their permits at risk. That’s why proactive planning and knowledgeable guidance are essential.
Swiftbonds Provides Fast, Reliable Bond Support for CNG Dealers
Based on our experience supporting energy businesses across Texas, Swiftbonds has developed a straightforward system for issuing and maintaining the Texas – Motor Fuels Tax Continuous Bond – Compressed Natural Gas. Our role is to make this process painless—from calculating the proper bond amount to getting it filed with the state.
We help clients avoid the guesswork. With expertise in bonds tied to compressed fuels, traditional gasoline, and diesel, our team ensures your documentation is complete and correct. Whether you’re applying for your first fuel license or updating your bond based on new volume, Swiftbonds delivers accurate, fast results. This process mirrors how we support similar filings, like the Texas – Motor Fuels Tax Continuous Bond – Diesel Fuel, which requires the same approach but for a different fuel class.
Steps to Secure a Compressed Natural Gas Bond
What we’ve discovered is that clients succeed when they follow a structured approach:
Step 1: Define Fuel Activity
Identify whether your operation qualifies as a CNG dealer, supplier, or user under Texas law.
Step 2: Calculate Tax Liability
Review your past or projected CNG volumes and determine the peak tax owed during any reporting period. Multiply this by two to get your bond amount.
Step 3: Request a Bond Quote
Send financials and your CNG registration details to Swiftbonds to begin underwriting.
Step 4: Review and Sign Bond
After receiving the completed bond, review the terms and sign. This step confirms your responsibility.
Step 5: Submit to the Comptroller
File the bond with the Texas Comptroller to activate your fuel license. This may be done electronically.
Step 6: Update Annually
Reevaluate your fuel tax volume each year. Swiftbonds will help adjust the bond if needed and manage renewal deadlines.
Timely Filing Protects Fuel Operations
We’ve found that early planning avoids unnecessary licensing setbacks. Waiting until the last minute to calculate your bond or submit documentation can create bottlenecks. Worse, if you’re distributing CNG without a bond in place, your operation may face penalties or suspension under state law.
Swiftbonds’ streamlined onboarding process means you can file within a business day in most cases—assuming financial documentation is ready. Getting this done early keeps your business on track and your inventory moving.
Lack of Bonding Leads to Business Risk
In our observation, businesses without this bond face more than licensing hurdles—they risk fines, back taxes, and even reputational damage. When the state cannot collect from the operator directly, they claim funds through the bond. If that bond lapses or was filed incorrectly, your operation takes the financial hit directly.
Permits tied to fuel tax compliance must be maintained year-round. Failure to do so can affect your relationship with suppliers, increase audit frequency, and limit your access to expansion capital. The right bond avoids these issues before they start.
Proper Bonding Builds Trust and Operational Freedom
We’ve learned that maintaining an accurate and current Texas – Motor Fuels Tax Continuous Bond – Compressed Natural Gas helps businesses gain favor with regulators and suppliers alike. It reflects fiscal discipline and long-term planning. As your operation scales, a strong bond history also makes it easier to expand into related fuel types—such as gasoline or diesel—using complementary filings like the Texas – Motor Fuels Tax Continuous (Gasoline) Bond.
With Swiftbonds, you can maintain all fuel bonds under one service model, reducing complexity and making state interaction far smoother.
State Statutes
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Texas Tax Code §162.361(b) – Requires continuous bonding for compressed natural gas dealers and users, covering all tax liabilities for each reporting period.
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Texas Tax Code §162.361(d) – Bond amount must equal twice the highest monthly liability, with a minimum of $30,000 and a maximum of $600,000.
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Texas Tax Code §162.212(d) – Bond must be renewed annually and remain active year-round unless released by the Comptroller.
Conclusion
We’ve come to appreciate that the Texas – Motor Fuels Tax Continuous Bond – Compressed Natural Gas is more than just a tax tool—it’s a pathway to legal, confident operations in Texas’ growing CNG sector. For dealers, users, and distributors, this bond supports growth, compliance, and peace of mind.
Swiftbonds simplifies every step. Whether you’re managing multiple fuel types or starting fresh with compressed gas, our process helps you get bonded fast and correctly. That confidence allows you to focus on delivering fuel—not worrying about compliance gaps.
Frequently Asked Questions
Who must file a CNG continuous bond in Texas?
We’ve often noticed confusion about this. Any dealer, user, or supplier of compressed natural gas as motor fuel in Texas must file a continuous bond to cover fuel tax liability.
How is the bond amount determined?
We’ve often noticed underestimation of the amount. The bond must equal twice the maximum amount of tax owed for any single reporting period, with a $30,000 minimum.
Can this bond be used for multiple fuel types?
We’ve often noticed this question from multi-fuel operators. No, CNG requires a separate bond. However, related bonds like the Texas – Motor Fuels Tax Continuous Bond – Diesel Fuel may be filed alongside it for other fuel types.
What happens if the bond is canceled or expires?
We’ve often noticed license lapses tied to this issue. If the bond is not active, the Comptroller may suspend or revoke your fuel permit until a valid bond is filed.
How long does it take to secure this bond?
We’ve often noticed time crunches for license renewals. Most bonds can be issued within one business day after underwriting approval, especially with Swiftbonds’ rapid service.