TankRust
This is how you do it using a kit from POR-15.
POR-15 sells a complete motorcycle kit for around $36+SH here which includes a bottle of Marine-Clean, a bottle of Metal-Ready acid, a can of POR15 sealer and easy to follow instructions. Here's some photos and tips on POR-ing a tank. In my case duct tape didn't really stick to seal the holes, I had to use scotch tape. Otherwise it was pretty straight forward. Using rubber gloves and safety goggles is a must. BTW, the plasic bottles the stuff comes in make perfect funnels for the job when cut in half.
First step is to pour gasoline out and rinse the tank with water. Then remove any gum and deposits from the tank with Marine-Clean solvent for at least 20 minutes. Then rinse with warm water. Then remove rust with acid-based Metal-Ready (slosh it periodically for up to 2 hours). Next the tank needs to be flushed with hot water to get rid of the acid (some people add acetone or denatured alcohol to quicken the process). Dry the tank with a hair drier, fan, heat gun, or alike. In my experience a hair drier was simply too whimpy for the job - 3 hours of blowing high-temp into the tank still did not remove all the water. So I figured to use a shop-vac blowing in lots of room-temperature air into the tank. Went much better.
The tank must be completely totally absolutely dry before pouring the sealant in. The sealant can is quite small, but that amount is plenty. I even had to drain some stuff out. According to POR-15 it's no good to leave too much in the tank, puddled sealant does not cure well. I ended up keping the tank upside down for the final stretch of the cure. Just to have that weaker thicker coat on top of the tank, not in place of constant contact with gas (just in case, maybe I'm paranoid). Cure the sealant for at least 4 days before using the tank.
Another alternative to POR15 is Kreem which in many ways is similar to POR15 (more discussion). Which is better? That's you call. Opinions really vary. The GSTwin board seems to favor POR-15 (except Srinath). Too many people had failed their first attempt to Kreem and ended up removing loose film particles and starting again. I personally succeeded with the POR-15 treatment recently, I touched that stuff first time in my life. It was not that hard after all, just time consuming. POR-15 coating is hard, it apparently is good for really rusty tanks, it seals pinholes, creating thicker harder surface. Kreem seems to fit better for light rust situations. It forms thinner and more flexible film.
If you don't want to use the kits here's some information you may find useful. Generally speaking there are two acids to use for etching the rust -- Muriatic acid (a.k.a. Hydro-Cloric Acid) or Phosphoric acid (naval jelly). The Muriatic acid acts fast (<10 minutes) on both rust and metal, it's best when used as a first step on really rusty tanks (but watch for those pinholes, the acid will really "open" them up). Some folks reported to use small marbles, stones, bolts, a piece of metal chain, or alike to loosen rust flakes when sloshing with acid. Muriatic acid leaves bare metal which will rust again in no time (hence need for immediate coating). It may be found at Home Depot (Garden department). Phosphoric acid is much slower, but it leaves behind a smooth coating of iron phosphate over the iron, which does not rust easily, and is easily coated (e.g. with gas tank epoxy). BTW, POR15 kit Metal-Ready apears to be Phosphoric acid based. For more read this topic and also use Search at GWTwin.com forums.
Alternative to acid is less hazardous Evaporust. Autozone may have a quart for $8. Another similar product is from Rusteco.com. There is electrolysis method of rust removal discussed here.. The how-to is here. also if the rust is on the thick side, rough grain sand and or small peagravels will work as an abrasive prior to the por or kreem treatments.
If you are not comfortable messing around with 3-step process you may find a local shop to do the job (it may be on the expensive side though). Reportedly radiator shops can flush your tank with acid for about $35.