Instructions For Form 720 - 2017 (Page 5 of 20) in pdf

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

EPA under the Clean Air Act, section 211 (as in effect on

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

March 31, 2003); and (c) the taxpayer must be registered by

the collecting agent to collect the tax. The report must

the IRS. If these requirements are not met, you must report

contain the name and address of the taxpayer, the type of

the sale, removal, or use of a diesel-water emulsion as

facility provided or service rendered, the amount paid for the

diesel.

facility or service (the amount on which the tax is based), and

IRS Nos. 105, 107, 119, and 111. Tax is imposed at $.001

the date paid.

per gallon on removals, entries, and sales of gasoline, diesel,

Regular method taxpayers. For regular method taxpayers,

and kerosene described as exempt transactions. Multiply the

the report must be filed by the due date of the Form 720 on

total number of gallons subject to tax for each fuel by $.001

which the tax would have been reported.

and enter the amount in the tax column for the following IRS

Nos.

Alternative method taxpayers. For alternative method

IRS No. 105, dyed diesel, LUST tax.

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

IRS No. 107, dyed kerosene, LUST tax.

Form 720 that includes an adjustment to the separate

IRS No. 119, LUST tax, other exempt removals; report

account for the uncollected tax. See Alternative method (IRS

gasoline blendstocks, kerosene used for a feedstock

Nos. 22, 26, 27, and 28), later.

purpose, and diesel or kerosene sold or used in Alaska.

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

IRS No. 111, kerosene for use in aviation, LUST tax on

uncollected tax report with Form 720. Instead, mail the

nontaxable uses; report gallons of kerosene removed directly

report to:

from a terminal into the fuel tank of an aircraft for nontaxable

uses.

Department of the Treasury

Kerosene (IRS No. 35). If you are liable for the kerosene

Internal Revenue Service

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

Cincinnati, OH 45999

line 35(a). If you are liable for the kerosene tax on events

other than removal at the terminal rack, report these gallons

Fuel Taxes

of kerosene on line 35(b).

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

Multiply the total number of gallons subject to tax on lines

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

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

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

Also see Schedule T. Two-Party Exchange Information

information as shown in the Model Certificate B in the

Reporting, later, if applicable.

Appendix of Pub. 510.

Kerosene for use in aviation (IRS Nos. 69, 77, and 111).

The person who paid the first tax must do all of the

Generally, kerosene is taxed at $.244 per gallon.

following.

For kerosene removed directly from a terminal into the fuel

Give a copy of the first taxpayer's report to the buyer.

tank of an aircraft for use in noncommercial aviation, the tax

File the first taxpayer's report with Form 720 for the quarter

rate is $.219 per gallon. Report these gallons on the line for

for which the report relates.

IRS No. 69.

Write “EXCISE—FIRST TAXPAYER'S REPORT” across

For kerosene removed directly from a terminal into the fuel

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

tank of an aircraft for use in commercial aviation (other than

of Form 720, send the copy to:

foreign trade), the tax rate is generally $.044 per gallon.

Report these gallons on the line for IRS No. 77.

Department of the Treasury

For kerosene removed directly from a terminal into the fuel

Internal Revenue Service

tank of an aircraft for nontaxable uses, the tax rate is

Cincinnati, OH 45999-0555

generally $.001 per gallon. Report these gallons on the line

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

for IRS No. 111.

on removal at the terminal rack, report these gallons on

For kerosene removed directly from a terminal into the fuel

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

tank of a fractional ownership program aircraft after March

other than removal at the terminal rack, report these gallons

31, 2012, a surtax of $.141 per gallon also applies. Also

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

report these gallons on the line for IRS No. 13.

you have produced diesel by blending biodiesel with taxed

Other fuels (IRS No. 79). You are liable for the tax on the

diesel outside of the bulk transfer/terminal system, report

fuels listed below when they are delivered into the fuel supply

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

tank of a motor vehicle or motorboat (or trains for B-100).

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

Use the following table to determine the tax for each gallon.

Multiply the total number of gallons subject to tax on lines

Fill in the number of gallons and the appropriate rate in the

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

Rate column on the line for IRS No. 79. If more than one rate

column.

applies, leave the Rate column blank and attach a schedule

Also see Schedule T. Two-Party Exchange Information

showing the rates and number of gallons taxed at each rate.

Reporting, later, if applicable.

Dieselwater emulsion (IRS No. 104). If you are liable for

the reduced rate (see below) of tax on a diesel-water

emulsion removal at the terminal rack or other taxable event,

report these gallons on the line for IRS No. 104.

Requirements. All of the following requirements must be

met to be eligible for the reduced rate: (a) the diesel-water

emulsion must contain at least 14% water; (b) the emulsion

additive must be registered by a U.S. manufacturer with the

Instructions for Form 720 (Rev. 12017)

Instructions For Form 720 - 2017 Page 5

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