Table of Contents
- Definitions
- Information Returns
- Registration Requirements
- Gasoline and Aviation Gasoline
- Diesel Fuel and Kerosene
- Diesel-Water Fuel Emulsion
- Kerosene for Use in Aviation
- Other Fuels (Including Alternative Fuels)
- Compressed Natural Gas (CNG)
- Fuels Used on Inland Waterways
- Alcohol Sold as But Not Used as Fuel
- Biodiesel Sold as But Not Used as Fuel
Excise taxes are imposed on all the following fuels.
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Gasoline, including aviation gasoline and gasoline blendstocks.
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Diesel fuel, including dyed diesel fuel.
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Diesel-water fuel emulsion.
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Kerosene, including dyed kerosene and kerosene used in aviation.
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Other Fuels (including alternative fuels).
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Compressed natural gas (CNG).
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Fuels used in commercial transportation on inland waterways.
The following terms are used throughout the discussion of fuel taxes. Other terms are defined in the discussion of the specific fuels to which they pertain.
Form 720-TO and Form 720-CS are information returns used to report monthly receipts and disbursements of liquid products. A liquid product is any liquid transported into storage at a terminal or delivered out of a terminal. For a list of products, see the product code table in the Instructions for Forms 720-TO and 720-CS.
The returns are due the last day of the month following the month in which the transaction occurs. Generally, these returns can be filed on paper or electronically. For information on filing electronically, see Publication 3536, Motor Fuel Excise Tax EDI Guide. Publication 3536 is only available on the IRS website.
The following discussion applies to excise tax registration requirements for activities relating to fuels only. See Form 637 for other persons who must register and for more information about registration.
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Blender,
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Enterer,
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Pipeline operator,
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Position holder,
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Refiner,
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Terminal operator,
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Vessel operator,
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Train operator who uses dyed diesel fuel in his or her trains and incurs liability for tax at the train rate, or
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Producer or importer of alcohol, biodiesel, agri-biodiesel, and renewable diesel.
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Feedstock user,
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Industrial user,
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Throughputter that is not a position holder,
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Ultimate vendor,
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Diesel-water fuel emulsion producer,
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Credit card issuer, or
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Alternative fuel claimant.
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Qualified ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from coal, including peat),
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Partially exempt ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from natural gas), or
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Denatured alcohol.
The tax on gasoline is $.184 per gallon. The tax on aviation gasoline is $.194 per gallon. Tax is imposed on the removal, entry, or sale of gasoline. Each of these events is discussed later. Also, see the special rules that apply to gasoline blendstocks, later.
If the tax is paid on the gasoline in more than one event, a refund may be allowed for the “second” tax paid. See Refunds of Second Tax in chapter 2.
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The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator.
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The exchange transaction occurs before or at the same time as removal across the rack by the receiving person.
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The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO.
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The transaction is subject to a written contract.
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The terminal operator is a registrant.
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The terminal operator has an unexpired notification certificate (discussed later) from the position holder.
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The terminal operator has no reason to believe any information on the certificate is false.
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It is made by bulk transfer and the refiner, the owner of the gasoline immediately before the removal, or the operator of the pipeline or vessel is not a registrant.
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It is made at the refinery rack.
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The gasoline is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel.
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The gasoline is received at a facility operated by a registrant and located within the bulk transfer/terminal system.
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The removal from the refinery is by railcar.
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The same person operates the refinery and the facility at which the gasoline is received.
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It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant.
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It is not made by bulk transfer.
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The importer of record has an unexpired notification certificate (discussed later) from the enterer.
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The importer of record has no reason to believe any information in the certificate is false.
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No tax was previously imposed (as discussed earlier) on any of the following events.
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The removal from the refinery.
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The entry into the United States.
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The removal from a terminal by an unregistered position holder.
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Upon removal from the pipeline or vessel, the gasoline is not received at an approved terminal or refinery (or at another pipeline or vessel).
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The owner is a registrant.
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The owner has an unexpired notification certificate (discussed later) from the operator of the terminal or refinery where the gasoline is received.
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The owner has no reason to believe any information on the certificate is false.
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The seller is a registrant.
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The seller has an unexpired notification certificate (discussed later) from the buyer.
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The seller has no reason to believe any information on the certificate is false.
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The buyer's principal place of business is not in the United States.
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The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel.
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The seller is a registrant and the exporter of record.
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The fuel was exported.
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Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty, or
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Anyone who willfully causes the person to fail to pay the tax.
Gasoline blendstocks may be subject to $.001 per gallon LUST tax as discussed below.
Gasoline includes gasoline blendstocks. The previous discussions apply to these blendstocks. However, if certain conditions are met, the removal, entry, or sale of gasoline blendstocks are taxed at $.001 per gallon or are not subject to the excise tax.
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Alkylate,
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Butane,
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Butene,
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Catalytically cracked gasoline,
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Coker gasoline,
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Ethyl tertiary butyl ether (ETBE),
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Hexane,
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Hydrocrackate,
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Isomerate,
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Methyl tertiary butyl ether (MTBE),
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Mixed xylene (not including any separated isomer of xylene),
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Natural gasoline,
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Pentane,
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Pentane mixture,
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Polymer gasoline,
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Raffinate,
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Reformate,
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Straight-run gasoline,
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Straight-run naphtha,
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Tertiary amyl methyl ether (TAME),
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Tertiary butyl alcohol (gasoline grade) (TBA),
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Thermally cracked gasoline, and
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Toluene.
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The person has an unexpired certificate (discussed later) from the buyer.
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The person has no reason to believe any information in the certificate is false.
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The seller has an unexpired certificate (discussed next) from the buyer.
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The seller has no reason to believe any information in the certificate is false.
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The date 1 year after the effective date (not earlier than the date signed) of the certificate.
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The date a new certificate is provided to the seller.
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The date the seller is notified that the buyer's right to provide a certificate has been withdrawn.
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The person is a registrant.
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The person has an unexpired notification certificate (discussed earlier) from the operator of the terminal or refinery where the gasoline blendstocks are received.
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The person has no reason to believe any information on the certificate is false.
Generally, diesel fuel and kerosene are taxed in the same manner as gasoline (discussed earlier). However, special rules (discussed later) apply to dyed diesel fuel and dyed kerosene, and to undyed diesel fuel and undyed kerosene sold or used in Alaska for certain nontaxable uses and undyed kerosene used for a feedstock purpose.
Diesel fuel means:
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Any liquid that without further processing or blending is suitable for use as a fuel in a diesel-powered highway vehicle or train, and
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Transmix.
A liquid is suitable for this use if the liquid has practical and commercial fitness for use in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. A liquid may possess this practical and commercial fitness even though the specified use is not the predominant use of the liquid. However, a liquid does not possess this practical and commercial fitness solely by reason of its possible or rare use as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. Diesel fuel does not include gasoline, kerosene, excluded liquid, No. 5 and No. 6 fuel oils covered by ASTM specification D396, or F-76 (Fuel Naval Distillate) covered by military specification MIL-F-16884.
An excluded liquid is either of the following.
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A liquid that contains less than 4% normal paraffins.
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A liquid with all the following properties.
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Distillation range of 125 degrees Fahrenheit or less.
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Sulfur content of 10 ppm or less.
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Minimum color of +27 Saybolt.
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Transmix means a by-product of refined products created by the mixing of different specification products during pipeline transportation.
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One of the two grades of kerosene (No. 1-K and No. 2-K) covered by ASTM specification D3699.
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Kerosene-type jet fuel covered by ASTM specification D1655 or military specification MIL-DTL-5624T (Grade JP-5) or MIL-DTL-83133E (Grade JP-8). See Kerosene for Use in Aviation, later.
The tax on diesel fuel and kerosene is $.244 per gallon. It is imposed on the removal, entry, or sale of diesel fuel and kerosene. Each of these events is discussed later. Only the $.001 LUST tax applies to dyed diesel fuel and dyed kerosene, discussed later.
If the tax is paid on the diesel fuel or kerosene in more than one event, a refund may be allowed for the “second” tax paid. See Refunds of Second Tax, in chapter 2.
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Scheduled transportation along regular routes regardless of the size of the bus.
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Nonscheduled transportation if the seating capacity of the bus is at least 20 adults (not including the driver).
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The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator.
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The exchange transaction occurs before or at the same time as completion of removal across the rack by the receiving person.
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The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO.
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The transaction is subject to a written contract.
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The terminal operator is a registrant.
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The terminal operator has an unexpired notification certificate (discussed under Gasoline) from the position holder.
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The terminal operator has no reason to believe any information on the certificate is false.
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It is made by bulk transfer and the refiner, the owner of the fuel immediately before the removal, or the operator of the pipeline or vessel is not a registrant.
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It is made at the refinery rack.
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The diesel fuel or kerosene is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel.
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The diesel fuel or kerosene is received at a facility operated by a registrant and located within the bulk transfer/terminal system.
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The removal from the refinery is by:
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Railcar and the same person operates the refinery and the facility at which the diesel fuel or kerosene is received, or
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For diesel fuel only, a trailer or semi-trailer used exclusively to transport the diesel fuel from a refinery (described in (1)) to a facility (described in (2)) less than 20 miles from the refinery.
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It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant.
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It is not made by bulk transfer.
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The importer of record has an unexpired notification certificate (discussed under Gasoline) from the enterer.
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The importer of record has no reason to believe any information in the certificate is false.
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No tax was previously imposed (as discussed earlier) on any of the following events.
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The removal from the refinery.
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The entry into the United States.
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The removal from a terminal by an unregistered position holder.
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Upon removal from the pipeline or vessel, the diesel fuel or kerosene is not received at an approved terminal or refinery (or at another pipeline or vessel).
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The owner is a registrant.
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The owner has an unexpired notification certificate (discussed under Gasoline) from the operator of the terminal or refinery where the diesel fuel or kerosene is received.
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The owner has no reason to believe any information on the certificate is false.
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The seller is a registrant.
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The seller has an unexpired notification certificate (discussed under Gasoline) from the buyer.
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The seller has no reason to believe any information on the certificate is false.
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The buyer's principal place of business is not in the United States.
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The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel.
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The seller is a registrant and the exporter of record.
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The fuel was exported.
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Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty; or
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Anyone who willfully causes the person to fail to pay the tax.
Dyed diesel fuel and dyed kerosene are subject to $.001 per gallon LUST tax as discussed below, unless the fuel is for export.
The excise tax is not imposed on the removal, entry, or sale of diesel fuel or kerosene (other than the LUST tax) if all the following tests are met.
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The person otherwise liable for tax (for example, the position holder) is a registrant.
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In the case of a removal from a terminal, the terminal is an approved terminal.
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The diesel fuel or kerosene satisfies the dyeing requirements (described next).
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It contains the dye Solvent Red 164 (and no other dye) at a concentration spectrally equivalent to at least 3.9 pounds of the solid dye standard Solvent Red 26 per thousand barrels of fuel or any dye of a type and in a concentration that has been approved by the Commissioner.
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Is indelibly dyed by mechanical injection. See section 6 of Notice 2005-80 for transition rules that apply until final regulations are issued by the IRS.
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Provided by the terminal operator to any person that receives dyed diesel fuel or dyed kerosene at a terminal rack of that operator, and
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Posted by a seller on any retail pump or other delivery facility where it sells dyed diesel fuel or dyed kerosene for use by its buyer.
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Any dyed fuel is sold or held for sale by the person for a use the person knows or has reason to know is not a nontaxable use of the fuel.
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Any dyed fuel is held for use or used by the person for a use other than a nontaxable use and the person knew, or had reason to know, that the fuel was dyed.
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The person willfully alters, chemically or otherwise, or attempts to so alter, the strength or composition of any dye in dyed fuel.
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The person has knowledge that a dyed fuel that has been altered, as described in (3) above, sells or holds for sale such fuel for any use for which the person knows or has reason to know is not a nontaxable use of the fuel.
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Fraud or a mistake in the chemical analysis, or
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Mathematical calculation of the penalty.
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Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any undyed liquid and the resulting product meets the dyeing requirements.
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Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any other liquid (other than diesel fuel or kerosene) that contains the type and amount of dye required to meet the dyeing requirements.
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The alteration or attempted alteration occurs in an exempt area of Alaska. See Removal for sale or use in Alaska, later.
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Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with diesel fuel or kerosene not meeting the dyeing requirements and the blending occurs as part of a nontaxable use (other than export), discussed later.
Tax of $.001 per gallon is imposed on:
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Undyed diesel fuel or undyed kerosene sold or used in Alaska for certain nontaxable uses (see Later sales on page 10).
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Undyed kerosene used for feedstock purposes.
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The person otherwise liable for the tax (position holder, refiner, or enterer):
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Is a registrant,
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Can show satisfactory evidence of the nontaxable nature of the transaction, and
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Has no reason to believe the evidence is false.
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In the case of a removal from a terminal, the terminal is an approved terminal.
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The owner of the fuel immediately after the removal or entry holds the fuel for its own use in a nontaxable use (discussed later) or is a qualified dealer.
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The fuel is sold in Alaska for certain nontaxable uses.
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The buyer buys the fuel for its own use in a nontaxable use or is a qualified dealer.
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The seller can show satisfactory evidence of the nontaxable nature of the transaction and has no reason to believe the evidence is false.
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The person otherwise liable for tax (position holder, refiner, or enterer) is a registrant.
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In the case of a removal from a terminal, the terminal is an approved terminal.
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Either:
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The person otherwise liable for tax uses the kerosene for a feedstock purpose, or
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The kerosene is sold for use by the buyer for a feedstock purpose and, at the time of the sale, the person otherwise liable for tax has an unexpired certificate (described later) from the buyer and has no reason to believe any information on the certificate is false.
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The date 1 year after the effective date (not earlier than the date signed) of the certificate.
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The date the seller is provided a new certificate or notice that the current certificate is invalid.
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The date the seller is notified the buyer's registration has been revoked or suspended.
Tax is imposed on the delivery of any of the following into the fuel supply tank of a diesel-powered highway vehicle or train.
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Any dyed diesel fuel or dyed kerosene for other than a nontaxable use.
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Any undyed diesel fuel or undyed kerosene on which a credit or refund (for fuel used for a nontaxable purpose) has been allowed.
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Any liquid other than gasoline, diesel fuel, or kerosene.
Generally, this back-up tax is imposed at a rate of $.244 per gallon.
Diesel-water fuel emulsion means diesel fuel at least 14 percent of which is water and for which the emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act.
A reduced tax rate of $.198 per gallon is imposed on a diesel-water fuel emulsion. To be eligible for the reduced rate, the person who sells, removes, or uses the diesel-water fuel emulsion must be registered by the IRS. If the diesel-water fuel emulsion does not meet the requirements above, or if the person who sells, removes, or uses the fuel is not registered, the diesel-water fuel emulsion is taxed at $.244 per gallon.
Generally, kerosene is taxed at $.244 per gallon unless a reduced rate applies (see Diesel Fuel and Kerosene, earlier). For kerosene removed directly from a terminal into the fuel tank of an aircraft for use in noncommercial aviation, the tax rate is $.219. The rate of $.219 also applies if kerosene is removed into any aircraft from a qualified refueler truck, tanker, or tank wagon that is loaded with the kerosene from a terminal that is located within an airport. The airport terminal does not need to be a secured airport terminal for this rate to apply. However, the refueler truck, tanker, or tank wagon must meet the requirements discussed under Certain refueler trucks, tankers, and tank wagons, treated as terminals, later.
For kerosene removed directly into the fuel tank of an aircraft for use in commercial aviation, the rate of tax is $.044 per gallon. For kerosene removed into an aircraft from a qualified refueler truck, tanker, or tank wagon, the $.044 rate applies only if the truck, tanker, or tank wagon is loaded at a terminal that is located in a secured area of the airport. See Terminal located within a secured area of an airport, later. In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix.
For kerosene removed directly into the fuel tank of an aircraft for a use exempt from tax under Internal Revenue Code section 4041(c) (such as use in an aircraft for the exclusive use of a state or local government), the rate of tax is $.001. There is no tax on kerosene removed directly into the fuel tank of an aircraft for use in foreign trade. The kerosene must be removed from a qualifying refueler truck, tanker, or tank wagon loaded at a terminal located within a secured area of an airport. See Terminal located within a secured area of an airport, later. In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix. The position holder is liable for the $.001 per gallon tax.
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Such terminal is located within an area of an airport.
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Any kerosene for use in aviation that is loaded in a refueler truck, tanker, or tank wagon at a terminal is for delivery into aircraft at the airport in which the terminal is located.
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Except in exigent circumstances, such as those identified in Notice 2005-80, no vehicle registered for highway use is loaded with kerosene for use in aviation at the terminal.
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The refueler truck, tanker, or tank wagon meets the following requirements:
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Has storage tanks, hose, and coupling equipment designed and used for fueling aircraft,
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Is not registered for highway use, and
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Is operated by the terminal operator or a person that makes a daily accounting to the terminal operator of each delivery of fuel from the refueler truck, tanker, or tank wagon. Information reporting will be required by terminal operators regarding this provision. Until the format of this information reporting is issued, taxpayers are required to retain records regarding the daily accounting, but are not required to report such information.
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If the kerosene is removed directly into the fuel tank of an aircraft for use in commercial aviation, the operator of the aircraft in commercial aviation is liable for the tax on the removal at the rate of $.044 per gallon. However, the position holder is liable for the LUST tax for kerosene for use in aviation removed directly into the fuel tank of an aircraft for use exempt from tax under Internal Revenue Code section 4041(c) (except foreign trade). For example, for kerosene removed directly into the aircraft for use in military aircraft, the position holder is liable for the tax.
For the aircraft operator to be liable for the tax $.044 rate, the position holder must meet the following requirements:
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Is a taxable fuel registrant,
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Has an unexpired certificate (a model certificate is shown in the Appendix as Model Certificate K) from the operator of the aircraft, and
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Has no reason to believe any of the information in the certificate is false.
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Any use exclusively for the purpose of skydiving.
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Certain air transportation by seaplane. See Seaplanes under Transportation of Persons by Air in chapter 4.
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Any use of an aircraft owned or leased by a member of an affiliated group and unavailable for hire by nonmembers. For more information, see Aircraft used by affiliated corporations under Special Rules on Transportation Taxes, in chapter 4.
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Any use of an aircraft that has a maximum certificated takeoff weight of 6,000 pounds or less, unless the aircraft is operated on an established line. For more information, see Small aircraft under Special Rules on Transportation Taxes, in chapter 4.
A certificate is required from the aircraft operator:
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To support aircraft operator liability for tax on removal of kerosene for use in aviation directly into the fuel tank of an aircraft in commercial aviation, or
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For exempt uses.
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The date 1 year after the effective date (not earlier than the date signed) of the certificate.
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The date the buyer provides the seller a new certificate or notice that the current certificate is invalid.
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The date the IRS or the buyer notifies the seller that the buyer's right to provide a certificate has been withdrawn.
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The aircraft operator puts the reseller's name, address, and EIN on the certificate in place of the position holder's information; and
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The reseller provides the position holder with a statement of the kerosene reseller.
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The reseller's name, address, and EIN;
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The position holder's name, address, and EIN; and
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A statement that the reseller has no reason to believe that any information in the accompanying aircraft operator's certificate is false.
A claim may be made by the ultimate purchaser (the operator) for taxed kerosene for use in aviation used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia). A claim may be made by a registered ultimate vendor for certain sales. For more information, see chapter 2.
Other Fuels means any liquid except gas oil, fuel oil, or any product taxable under Internal Revenue Code section 4081. Other Fuels include alternative fuels. Alternative fuels are:
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Liquefied petroleum gas (LPG),
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“P Series” fuels,
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Compressed natural gas (CNG) (discussed later),
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Liquefied hydrogen,
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Any liquid fuel derived from coal (including peat) through the Fischer-Tropsch process,
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Liquid fuel derived from biomass, and
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Liquefied natural gas (LNG).
Liquefied petroleum gas includes propane, butane, pentane, or mixtures of those products.
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They are propelled by a motor.
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They are designed for carrying or towing loads from one place to another, regardless of the type of material or load carried or towed.
Tax is imposed on the delivery of Other Fuels into the fuel supply tank of the propulsion engine of a motor vehicle or motorboat. However, there is no tax on the delivery if tax was imposed under the bulk sales rule, discussed next, or the delivery is for a nontaxable use. If the delivery is in connection with a sale, the seller is liable for the tax. If it is not in connection with a sale, the operator of the vehicle or boat is liable for the tax.
Tax is imposed on the delivery of compressed natural gas (CNG) into the fuel supply tank of the propulsion engine of a motor vehicle or motorboat. See Form 720 for the tax rate. However, there is no tax on the delivery if tax was imposed under the bulk sales rule discussed next, or the delivery is for a nontaxable use, listed later. If the delivery is in connection with a sale, the seller is liable for the tax. If it is not in connection with a sale, the operator of the boat or vehicle is liable for the tax.
If CNG is delivered into the fuel supply tank by the seller in connection with the sale of CNG for a nontaxable use, the seller is liable for the tax unless, at the time of the sale, the seller has an exemption certificate from the buyer. The seller must have no reason to believe any information in the certificate is false.
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The date 1 year after the effective date (which may be no earlier than the date signed) of the certificate.
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The date a new certificate is provided to the seller.
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The date the seller is notified the buyer's right to provide a certificate has been withdrawn.
The tax on inland waterways fuel use applies at the rate listed on Form 720. This is in addition to all other taxes imposed on the sale or use of the fuel.
Tax applies to liquid fuel used in the propulsion system of commercial transportation vessels while traveling on certain inland and intracoastal waterways. The tax generally applies to all types of vessels, including ships, barges, and tugboats. The leaking underground storage tank (LUST) tax must be paid on any liquid fuel used on inland waterways that is not subject to LUST tax under section 4041(d) or 4081. For example, Bunker C residual fuel oil is subject to the LUST tax.
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The use is in the business of transporting property for compensation or hire.
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The use is in transporting property in the business of the owner, lessee, or operator of the vessel, whether or not a fee is charged.
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Moving without cargo.
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Awaiting passage through locks.
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Moving to or from a repair facility.
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Dislodging vessels grounded on a sand bar.
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Fleeting barges into a single tow.
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Maneuvering around loading and unloading docks.
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One or more of the barges in the tow is not a LASH barge, SEABEE barge, or other ocean-going barge carried aboard an ocean-going vessel.
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One or more of the barges is not on an international voyage.
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Part of the cargo carried is not being transported internationally.
All operators of vessels used in commercial waterway transportation who acquire liquid fuel must keep adequate records of all fuel used for taxable purposes. Operators who are seeking an exclusion from the tax must keep records that will support any exclusion claimed.
Your records should include all of the following information.
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The acquisition date and quantity of fuel delivered into storage tanks or the tanks on your vessel.
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The identification number or name of each vessel using the fuel.
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The departure time, departure point, route traveled, destination, and arrival time for each vessel.
If you claim an exemption from the tax, include in your records the following additional information as it pertains to you.
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The draft of the vessel on each voyage.
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The type of vessel in which you used the fuel.
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The ultimate use of the cargo (for vessels operated by state or local governments).
If the credit was claimed (either as an excise tax credit or income tax credit) or a refund was claimed, you are liable for an excise tax if you used the mixture or straight alcohol other than as a fuel, separated the alcohol from a mixture, or mixed the straight alcohol.
Report the tax on Form 720. The rate of tax depends on the applicable rate used to figure the credit. No deposits are required.
If the credit was claimed (either as an excise tax credit or income tax credit) or a refund was claimed, you are liable for an excise tax if you used the mixture or straight biodiesel other than as a fuel, separated the biodiesel from a mixture, or mixed the straight biodiesel.
Report the tax on Form 720. The rate of tax depends on the applicable rate used to figure the credit. No deposits are required.
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