Instructions For Form 720 - Quarterly Federal Excise Tax Return (Page 4 of 18) in pdf

request a credit or refund as described below and in Notices

Use of International Air Travel Facilities

2006-50 and 2007-11.

(IRS No. 27)

Collectors. The collector may request a credit or refund

For amounts paid during 2009 the tax on international flights

only if it has repaid the tax to the person from whom the tax

is:

•

was collected, or obtained the consent of that person to the

$16.10 per person for flights that begin or end in the

allowance of the credit or refund. These requirements also

United States, or

•

apply to nontaxable service refunds.

$8.00 per person for domestic segments that begin or end

in Alaska or Hawaii (applies only to departures).

Collectors using the regular method for deposits.

Collectors using the regular method for deposits must use

Communication and Air Transportation

Form 720X to request a credit or refund.

Taxes—Uncollected Tax Report

Collectors using the alternative method for deposits.

A separate report is required to be filed by collecting agents

Collectors using the alternative method for deposits must

of communications services (local and teletypewriter

adjust their separate accounts for the credit or refund. For

service) and air transportation taxes if the person from

more information, see Alternative method on page 8.

whom the facilities or services tax (the tax) is required to be

Form 720 taxpayers. Credits or refunds for nontaxable

collected (the taxpayer) refuses to pay the tax, or it is

service that was billed after February 28, 2003, and before

impossible for the collecting agent to collect the tax. The

August 1, 2006, can be requested by taxpayers only on their

report must contain the name and address of the taxpayer,

2006 federal income tax returns. Instructions to request the

the type of facility provided or service rendered, the amount

credit or refund are available with the 2006 income tax

paid for the facility or service (the amount on which the tax is

returns. Do not use Form 8849, Form 720, or Form 843 to

based), and the date paid.

make claims for nontaxable service; the IRS will not process

Regular method taxpayers. For regular method

these claims.

taxpayers, the report must be filed by the due date of the

Air Transportation Taxes

Form 720 on which the tax would have been reported.

Alternative method taxpayers. For alternative method

Who Must File

taxpayers, the report must be filed by the due date of the

The person receiving the payment for air transportation

Form 720 that includes an adjustment to the separate

services must collect and pay over the tax and file the

account for the uncollected tax. See Alternative method on

return. Enter the amount of tax collected or considered

page 9.

collected for the quarter.

Where to file. Do not file the uncollected tax report with

Form 720. Instead, mail the report to:

Transportation of Persons by Air (IRS No. 26)

The tax on transportation of persons by air is made up of the

Internal Revenue Service

percentage tax and the domestic segment tax. Add the

Excise Tax Program

percentage tax and the domestic segment tax to get the

SE:S:SP:EX MS C9-109

total tax on transportation of persons by air.

5000 Ellin Rd.

Lanham, MD 20706

Percentage tax. The percentage tax is 7.5% for amounts

paid for taxable transportation of persons by air.

Fuel Taxes

Domestic segment tax. For amounts paid for each

First taxpayer’s report. If you are reporting gallons of

domestic segment of taxable transportation of persons by

taxable fuel that may again be subject to tax, you may need

air, the domestic segment tax is $3.60 per segment for

to file a first taxpayer’s report. The report must contain all

transportation that begins in 2009.

the information as shown in the Model Certificate B in the

Example. In January 2009, Frank Jones pays $265.20

Appendix of Pub. 510.

to a commercial airline for a flight in January from

The person who paid the first tax must:

Washington to Chicago with an intermediate stop in

•

Give a copy of the first taxpayer’s report to the buyer;

Cleveland. The flight comprises two segments. The price

•

includes the $240 fare and $25.20 excise tax [($240 × 7.5%)

File the first taxpayer’s report with Form 720 for the

+ (2 × $3.60)] for which Frank is liable. The airline collects

quarter for which the report relates; and

•

Write “EXCISE — FIRST TAXPAYER’S REPORT” across

the tax from Frank and pays it over to the government.

the top of a separate copy of the report, and by the due date

Charter flights. If an aircraft is chartered, the domestic

of Form 720, send the copy to:

segment tax for each segment of taxable transportation is

Department of the Treasury

figured by multiplying the tax by the number of passengers

Internal Revenue Service

transported on the aircraft.

Cincinnati, OH 45999-0555

Example. In March 2009, Tim Clark pays $1,125.40 to

Diesel fuel (IRS No. 60). If you are liable for the diesel fuel

an air charter service to carry seven employees from

tax on removal at the terminal rack, report these gallons on

Washington to Detroit with an intermediate stop in

line 60(a). If you are liable for the diesel fuel tax on events

Pittsburgh. The flight comprises two segments. The price

other than removal at the terminal rack, report these gallons

includes the $1,000 charter payment and $125.40 excise tax

[($1,000 × 7.5%) + (2 × $3.60 × 7 passengers)] for which

on line 60(b). If you are liable for the diesel fuel tax because

you have produced diesel fuel by blending biodiesel with

Tim is liable. The charter service collects the tax from Tim

taxed diesel fuel outside of the bulk transfer/terminal

and pays it over to the government.

system, report these gallons of biodiesel on line 60(c). If you

Rural airports. If a segment is to or from a rural airport,

report gallons on line 60(c), do not report those gallons on

the domestic segment tax does not apply.

line 60(b).

Transportation of Property by Air (IRS No. 28)

Multiply the total number of gallons subject to tax on lines

The tax is 6.25% of amounts paid for transportation of

(a), (b), and (c) by $.244 and make one entry in the tax

property by air.

column.

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Instructions For Form 720 - Quarterly Federal Excise Tax Return Page 4

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