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Yes, the difference is off-road is not taxed. The dye is just an indicator that it is off road fuel which was not taxed for law enforcement purposes.

In the past before environmental regulations were what they are today, there could be various other differences like sulfur content, based on the purpose of the fuel. I think at this point, ULSD is what everything uses, even heating oil. Anything else is basically a specialty product.
 

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That is correct. Red dye just means it was sold tax-free. If you're in a registered motor vehicle and get stopped/stop at a required inspection point, and they dip your tank(s) and see red fuel then you're in trouble.
 

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Last I remember it was a $10K fine using off-road in an on-road vehicle.
 
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