20. (a) In the manner provided in this section the director shall refund or credit any tax, penalty or interest erroneously, illegally or unconstitutionally collected or paid if application to the director for such refund shall be made within four years from the payment thereof. Such application may be made by a customer who has actually paid the tax. Such application may also be made by a person required to collect the tax, who has collected and paid over such tax to the director, provided that the application is made within four years of the payment to him by the customer, but no actual refund of moneys shall be made to such person until the person shall first establish to the satisfaction of the director, under such regulations as the director may prescribe, that the person has repaid to the customer the amount for which the application for refund is made. The director may, in lieu of any refund, allow credit on payments due from the applicant.

(b) A person shall not be entitled to a revision, refund or credit under this section of a tax, interest or penalty which had been determined to be due pursuant to the provisions of section 19 of P.L.1966, c.30 (C. 54:32B-19) where the person has had a hearing or an opportunity for a hearing as provided in said section or has failed to use the remedies therein provided unless the person otherwise meets the requirements of subsection b. of R.S.54:49-14. No refund or credit shall be made of a tax, interest or penalty paid after a determination by the director made pursuant to section 19 of P.L.1966, c.30 (C. 54:32B-19) unless it be found that such determination was erroneous, illegal or unconstitutional or otherwise improper, pursuant to law, in which event refund or credit shall be made of the tax, interest or penalty found to have been overpaid.

(c) (1) A purchaser may seek a refund of over-collected sales or use tax from the seller. This refund procedure shall provide the first course of remedy available to a purchaser seeking such a refund. A cause of action seeking a return of over-collected sales or use taxes from the seller shall not accrue until the purchaser has provided written notice to a seller and the seller has had sixty days to respond. Such notice shall contain the information necessary to determine the validity of the request.

(2) In connection with a purchaser’s request from a seller of over-collected sales or use tax, the seller shall be presumed to have a reasonable business practice, if in the collection of such sales or use taxes, the seller:

(i) uses either a provider or a system including a proprietary system, certified by the State; and

(ii) has remitted to the State all taxes collected less any deductions, credits, or collection allowances.

L.1966,c.30,s.20; amended 1992, c.175, s.32; 1998, c.106, s.7; 2005, c.126, s.32.