Instructions For Form 720 - Quarterly Federal Excise Tax Return

You may be able to use Form 8833, Treaty-Based

Alcohol sold as but not used as fuel (IRS No. 51). An

Return Position Disclosure Under Section 6114 or

excise tax is imposed if the credit was claimed on Form

7701(b), as a disclosure statement.

6478, Credit for Alcohol Used as Fuel, and any person

later:

How to file. At the top of Form 720, write “Section

1. Uses a mixture or straight alcohol for a purpose

6114 Treaty.” Provided you have no other transactions

other than fuel,

reportable on Form 720:

2. Separates the alcohol from the mixture, or

1. Check the one-time filing box on page 1. If this is

3. Mixes the straight alcohol.

your final return, check the final return box.

2. Write “None” on lines 1, 3, and 5.

Use the following table to determine the tax for each

3. Sign the return.

gallon of alcohol. Fill in the number of gallons and the

appropriate rate in the Rate column on the line for IRS

You need an EIN to file Form 720. If you do not have

No. 51. If more than one rate applies, leave the Rate

an EIN, use Form SS-4 to apply for one. See Employer

column blank and attach a schedule showing the rates

Identification Number (EIN) on page 3.

and number of gallons taxed at each rate.

Where to file. Mail the Form 720 with the attached

THEN the tax rate

statement to: Internal Revenue Service Center, P.O. Box

IF the alcohol is...

AND...

per gallon is...

21086, Philadelphia, PA 19114. Also, see the Caution

•

under Private Delivery Services on page 2.

at least 190 proof

is ethanol

$ .53

•

is methanol

.60

Exception. If you are reporting liabilities in Parts I or II

•

(Form 720), follow the instructions above for How to file,

benefited from the

.63

small ethanol

except mail the Form 720 to: Internal Revenue Service

producer credit

Center, Cincinnati, OH 45999-0009.

•

at least 150 proof but

is ethanol

$ .3926

•

Part II

less than 190 proof

is methanol

.45

•

benefited from the

.4926

Sport fishing equipment (IRS No. 41). The tax on sport

small ethanol

fishing equipment is 10% (.10) of the sales price. The tax

producer credit

is paid by the manufacturer, producer, or importer.

Taxable articles include fishing rods and poles (and

Floor Stocks Tax

component parts), reels, fly fishing lines (and other lines

not over 130 pounds test), fishing spears, spear guns,

Ozone-depleting chemicals floor stocks tax (IRS No.

spear tips, terminal tackle, fishing supplies and

20). Use Form 6627 to figure the liability for this tax.

accessories, and any parts or accessories sold on or in

Enter the amount from Form 6627, Part III, line 4, column

connection with these articles. See Pub. 510 for a

(d) on the line for IRS No. 20. Attach Form 6627 to Form

complete list of taxable articles. Add the tax on each sale

720 that is due July 31 of each year. Deposit the

during the quarter and enter the total on the line for IRS

payment by June 30 at an authorized financial institution.

No. 41.

See How To Make Deposits on page 7.

Electric outboard motors and sonar devices (IRS No.

Part III

42). The tax on an outboard motor or a sonar device for

finding fish is 3% (.03) of the sales price. The tax is paid

Line 4. Report on line 4 of Form 720 the total claims

by the manufacturer, producer, or importer. The tax is

from line 12 of Schedule C. See the instructions on

limited to $30 for each sonar device. Sonar devices for

page 8.

finding fish do not include graph recorders, digital types,

meter readouts, or combination graph recorders or

Lines 7a and 7b. Include on line 7a the amount from

combination meter readouts. Add the tax on each sale

line 10 of your previous return that you applied to this

return and the amount from line 7b. If you are applying an

during the quarter and enter the total on the line for IRS

No. 42.

amount from line 5b of Form 720X, enter that amount on

line 7b.

Bows (IRS No. 44). The tax on bows is 11% (.11) of the

Line 10. You may have any overpayment refunded or

sales price. The tax is paid by the manufacturer,

applied to your next return. Include on line 7a of your

producer, or importer. It applies to bows having a draw

next return the amount from line 10 you want to have

weight of 10 pounds or more. The tax is also imposed on

applied to that return.

the sale of any part or accessory suitable for inclusion in

or attachment to a taxable bow and any quiver suitable

If you owe other Federal tax, interest, or penalty,

for use with arrows described below. Add the tax on each

the overpayment on line 10 and line 7b will first be

sale during the quarter and enter the total on the line for

applied to the unpaid amounts.

CAUTION

IRS No. 44.

Arrow components (IRS No. 102). The tax on any

Payment of Taxes

shaft, point, nock, or vane is 12.4% (.124) of the sales

Generally, semimonthly deposits of excise taxes are

price for which the component is sold. The tax is paid by

required. A semimonthly period is the first 15 days of a

the manufacturer, producer, or importer of any

month (the first semimonthly period) or the 16th through

component used in the manufacture of any arrow that

the last day of a month (the second semimonthly period).

after assembly measures 18 inches or more in overall

length or is less than 18 inches long but is suitable for

However, no deposit is required for the situations

use with a bow that has a draw weight of 10 pounds or

listed below; the taxes are payable with the return.

•

more. Add the tax on each sale during the quarter and

The net liability for taxes listed in Part I (Form 720)

enter the total on the line for IRS No. 102.

does not exceed $2,500 for the quarter.

-6-

Instructions For Form 720 - Quarterly Federal Excise Tax Return - 2002 Page 6

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