If the gauge works with a test light hooked to ground, chances are good that the float has a breech in it's outer membrane, and has filled with fuel. Air pressure and temperatures cause the float to expand and contract,this effect is often coupled with electrolysis of dissimilar metals where the plated steel hook holds the float to the sender. Eventually the thin brass skin of the float ruptures from metal fatigue, and a pumping action ensues, causing the float to take on fuel, 'till it sinks. .
Plastic aftermarket floats often develop a leak at one end, where the ''bellybutton'' is melted to form a plug.
To remove the fuel sending unit's lock ring, (once the tank is empty) use a hammer and a piece of brass (to avoid sparks), and coax the lock ring counter-clockwise. Test light should flash a fairly consistent cadence if the original electro-mechanical instrument constant voltage regulator is functioning correctly.Modern transistorized cvrs will cause a weak but steady glow of the test light.
The o-ring is usually replaced when the sending unit is re-installed. Coat the o-ring with petroleum jelly, ( Vasoline) to hold it in place during assembly.