SECTION 1. PURPOSE
This Alcohol & Tobacco Tax & Trade Bureau (TTB) Procedure provides instruction and guidance to taxpayers electing to pay firearms and ammunition excise taxes by Electronic Funds Transfer (EFT). This procedure applies only to firearms and ammunition excise taxes and supersedes all prior procedures. This procedure was updated effective March 1, 2003. Substantive changes have occurred. The most important change is that the electronic fund transfer message format has been revised.

SECTION 2. BACKGROUND
TTB has established a voluntary electronic payment system, which allows taxpayers, at their option, to make firearms and ammunition excise tax payment by Electronic Funds Transfer (EFT). A taxpayer who elects to make tax payments by EFT must continue to make payment by EFT for a minimum of four consecutive calendar quarters.

An EFT is a non-paper, computer to computer, transfer of funds from the taxpayer’s financial institution account to the Treasury’s account at the Department of the Treasury. Such transfers are initiated through an electronic terminal and not by check, money order, or other paper instrument. The taxpayer’s financial institution, either directly or through a correspondent bank, must use the EFT system known as Fedwire. This system requires that the financial institution transmit the EFT payment to the Department of the Treasury.

SECTION 3. TAXPAYERS WRITTEN NOTIFICATION

Taxpayers who elect to make tax payments by EFT shall notify the Chief, National Revenue Center, in writing, of that fact. The notice shall be an agreement to make tax payment by EFT.

Taxpayers must submit their written notification on or before the 10th day of the calendar quarter preceding the calendar quarter in which the taxpayer will begin making payments by EFT. Once taxpayers have made this notification, they are not required to notify the Chief, National Revenue Center of their continued use of EFT in succeeding calendar quarters.

SECTION 4. DISCONTINUANCE OF TAX PAYMENTS BY EFT.

At any time after making EFT payments, for four consecutive calendar quarters, a taxpayer may elect to discontinue making payments by EFT and resume using some other approved form of payment, such as check or money order.

Taxpayers who elect to discontinue using EFT shall attach to the first tax deposit form or tax return on which they choose to discontinue paying the tax by EFT a written notification to the Chief, National Revenue Center stating that payment of firearms and ammunition excise tax will no longer be make by EFT.

SECTION 5. PREPARING AND FILING TTB TAX DEPOSIT FORMS AND TAX RETURNS.

Taxpayers paying taxes by EFT will indicate “payment made by EFT” in Item 5 of both ATF Form 5300.26, Federal Firearms and Ammunition Excise Tax Return and ATF Form 5300.27, Federal Firearms and Ammunition Excise Tax Deposit. This information is very important for the proper crediting of the taxpayer’s account. All other items on the forms will be prepared in accordance with instructions on the forms with the exception that EFT taxpayers will ignore any instruction or items indicating that the payment should accompany the tax deposit form or tax return. The use of EFT to pay taxes involves no change in the due dates of the tax deposits and tax return or the place of filing such deposits and returns.
ADDRESSES OF LOCATIONS FOR FILING THE TAX DEPOSIT AND TAX RETURN FORMS ARE SHOWN ON EACH RESPECTIVE FORM.
Taxpayers may choose to file their deposits and return on the last day prescribed by law. However, to facilitate processing, taxpayers are strongly encouraged to file their tax deposit forms and/or tax returns prior to making their EFT payments and well in advance of the filing due date. This procedure will allow TTB to more quickly match the tax deposit form and/or tax return to the EFT payment and to find any discrepancies. The longer discrepancies go undetected, the more costly they can be to the taxpayer in terms of additional penalties and interest owed.
The law (Title 26, United States Code, Section 6651(a)(2)) provides a penalty for failure to pay the amount shown as tax on a return on or before the date prescribed for payment of such tax. The law (Title 26, U.S.C., Section 6656(a)) also provides a penalty for failure to make timely deposits of taxes. The penalties shall be imposed unless it is shown that the failure to make a timely deposit or payment of tax is due to reasonable cause and not due to willful neglect. There is no such provision for forgiving interest when an EFT payment is not timely.

SECTION 6. ELECTRONIC FUNDS TRANSFER MESSAGES ON FEDWIRE

The instructions in this section, and the sample transfer message which follows, apply only to EFT payments made on Fedwire in connection with TTB tax returns.
Taxpayers must send a separate Fedwire message for each TTB tax deposit and/ or tax return required to be filed. Taxpayers may not use one Fedwire message to pay the tax reported on two or more tax deposits and/or tax returns. Taxpayers are responsible for making arrangements with their financial institution to send Fedwire messages. If a taxpayer's financial institution is not a member of the Federal Reserve System, the taxpayer's financial institution must use a correspondent bank having access to Fedwire.
Taxpayers must provide specific information to their financial institution so that a transfer of funds can take place. A sample Fedwire format and a description of required information are shown in Section 7. Some of the information remains constant, while the taxpayer and financial institution must provide other information, for each separate transaction. Taxpayers must take into account any deadlines established by their financial institution to transmit the Fedwire payment timely into the Treasury Account. Penalties and interest for late payment may be assessed when a payment has not been credited timely into the Treasury Account.
Taxpayers should follow up with their financial institution to ensure that the payment was made. Such confirmation should include: verification that funds were removed from the taxpayer's account and an acknowledgement by the financial institution that the payment was delivered to the Department of Treasury. This information will be useful if it becomes necessary to resolve any discrepancies. It will also serve as the record of payment to be retained as part of the taxpayer's records. Taxpayers and their financial institutions should use extreme care in providing information for EFT messages sent on Fedwire. Failure to supply correct information can result in errors that may subject the taxpayer to penalties and interest for late payment. Taxpayers are strongly urged to carefully review this section and Section 7 below with their financial institution well in advance of the date on which the first EFT message is to be sent on Fedwire.

SECTION 7. SAMPLE ELECTRONIC FUNDS TRANSFER (EFT) MESSAGE

An item definition of required information for a funds transfer message to the Treasury and a sample EFT message are given below.

Definition of Required Information for Funds Transfer Messages to Treasury

*SAMPLE OF FUNDS TRANSFER FORMAT

ORIGINATOR TO BENEFICIARY INFORMATION: Should contain the appropriate information to identify the taxpayer and tax deposit/return. The Originator to Beneficiary information field tag is used to signify the beginning of the free-form third party text. An example of data in this category for the Bureau would be as follows:

Tax Payer Name: The taxpayer's name as it appears on the TTB Tax Deposit/ Return.

Tax Deposit/Return Identification: Identify the tax deposit/return for which the Fedwire message is being made. The form number of the tax deposit/return should be provided by the taxpayer to its’ financial institution. The form number shall be followed by the taxable period. For example:

5300.26 1/1/03 – 3/31/03
5300.27 1/1/03 - 1/15/03

Employer Identification Number: This number is familiar to taxpayers and is very important to TTB for identifying taxpayers. The letters "EIN" should appear before the number.

Depositors should inform their financial institution to use due care and insure that all information is provided in the prescribed format. Failure to provide the information in the prescribed format may cause a delay in the transfer of funds resulting in assessment of penalties for failure to pay and failure to make timely EFT deposits and assessment of interest.

SECTION 8. OTHER METHODS OF ELECTRONIC PAYMENT
Taxpayers may also choose to pay their taxes electronically by using Remittance Express to process their payments though the Automated Clearing House (ACH) network. The data MUST be provided to your financial institution for proper inclusion in the prescribed transaction format.
The prescribed transaction format or payment type within ACH for TTB is Cash Concentration and Disbursement plus addendum record (CCD+). Remittance Express supports the CCD+ format that includes an addendum record necessary to completely identify your account and provide information concerning your payment to TTB.
If you choose to use Remittance Express to process your tax payments to TTB, you must complete and submit a Letter of Intent for Remitter. A sample of this letter is found in section 12 below.
The following is a brief synopsis of how remittance express works.

A. Taxpayer will transmit electronic payment instructions and accompanying remittance data to their financial institution SUFFICIENTLY IN ADVANCE TO PASS PAYMENT TO THE ACH 1 BUSINESS DAY PRIOR TO THE DUE DATE.

B. Taxpayer’s financial institution insures the timely payment is formatted in the correct CCD+ format and passes the payment file into the ACH network.

C. Overnight, the ACH network delivers the payment to Treasury's Account at the ACH Remitter Bank for credit to TTB.

D. TTB retrieves the remittance data through the CA$H-LINK financial reporting system and updates TTB's accounts receivable files.

SECTION 9. REMITTANCE EXPRESS

The following is a description of the data utilized by the financial institution in originating the ACH payment to TTB.

Sample of Remittance Express Data for Financial Institutions for use in originating ACH payments to TTB
ACH CCD+ FORMAT

* These fields are pre-defined fields.
** These fields are mandatory fields specific to TTB.

SECTION 10. ADDENDUM RECORD FORMAT

An Addendum Record format MUST accompany the data from the originating ACH payment described above in Section 9.

Sample Addendum Record Format

*** This field must provide specific information for Payment Related Information to aid TTB in identifying the taxpayer and tax return.

The Mandatory information for the above Payment Related field is as follows:

(1) Taxpayers name as it appears on the TTB Tax Deposit/Return (e.g. Gun Makers, Inc);
(2) Employer Identification Number (EIN) (e.g. XX-XXXXXXX)
(3) TTB tax deposit/ return form number to which the tax payments relates to (e.g. 5300.26);
(4) The tax period BEGINNING mm/dd/yy, and ENDING mm/dd/yy dates (e.g. 01/01/00 - 01/15/00).

NOTE: EACH NUMBERED ITEM MUST BE SEPARATED BY A SPACE OR A COMMA.

SECTION 11. SAMPLE FORMAT FOR THE PAYMENT RELATED FILES IN THE ADDENDA RECORD
EXCISE TAX (FIREARMS AND AMMUNITION)

A). (Return Payment)

Wednesdays Gun Shop,54-0101010,5300.26,01/01/03-03/31/03
B) (Deposit Coupon)

Sundays Shooting Gallery,54-7676767,5300.27,01/01/03-01/15/03

FORMAT MUST INCLUDE COMMA OR SPACE
COMPANY NAME, EIN,TTB TAX DEPOSIT/RETURN FORM NUMBER,TAX PERIOD
Reminder: To ensure proper classification and posting of your payment remember be sure to supply the correct TTB form number (either 5300.26 or 5300.27).

SECTION 12. REMITTANCE EXPRESS - LETTER OF INTENT FOR REMITTER

This letter is used to designate the method of payment that your organization plans to use to remit tax payments to the Alcohol and Tobacco Tax and Trade Bureau. A sample of the letter of intent for remitter is given below.

SAMPLE: REMITTANCE EXPRESS - LETTER OF INTENT FOR REMITTER

1. Remitting Organization Information

______________________________________________________________________________
(Name of Organization)

______________________________________________________________________________
(Address)

______________________________________________________________________________
(City, State and Zip Code)

2. Organization Contact Person:____________________________________________
Phone Number:____________________________________________
Email Address:____________________________________________

3. Organization Authorizing Official:

_____________________________________________________________________
(Name and Title)

________________________________________

________________________________________
(Signature of Authorizing Official)

SECTION 13. INQUIRIES

Inquiries about paying Firearms and Ammunition Excise Tax by EFT and about preparing Fedwire messages for payments made in connection with TTB tax deposits and/or returns should be directed to the Chief, National Revenue Center, FAET Unit, 8002 Federal Office Building, 550 Main Street, Cincinnati, Ohio 45202, Telephone No. 513-684-3817 or 800-398-2282.
This was last updated on February 28, 2003

Address for FEDEWIRE ABA 021030004

Treasury NYC, Department of the Treasury
Financial Manage Service
Financial Analysis Branch
Hyattsville, MD 20782
202-874-8895

Address for Remittance Express ABA 051036706

Financial Management Service
Financial Services Division
401 14th Street, SW. lCB-310A
Washington, DC 20227
202-874-7026