26 U.S.C. § 6421 — Gasoline used for certain nonhighway purposes, used by local transit systems, or sold for certain exempt purposes
submitted 70 years ago by ch. 462 to r/title-26-INTERNAL-REVENUE-CODE · 1,532 words · no verdicts yet
This section provides payments for gasoline used off-highway, in qualifying buses, or for specified exempt purposes. It defines off-highway business use, limits claims, and excludes certain farm, aviation, and train uses.
(a) Nonhighway uses. Except as subsection (i) provides, the Secretary* must pay the ultimate purchaser, without interest, for gasoline used in an off-highway business use: gallons used multiplied by the section 4081 tax rate. Except as subsection (f)(2) provides, the same calculation applies to gasoline used as aircraft fuel.
(b) Intercity, local, or school buses. (1) Except as paragraph (2) and subsection (i) provide, the Secretary must make the same payment for gasoline used in an automobile bus while it provides paid passenger land transportation open to the public, or transports students and employees of schools as defined in section 4221(d)(7)(C). (2) The public-transport rule does not apply to an unscheduled bus operating off regular routes unless it seats at least 20 adults besides the driver.
(c) Exempt purposes. If gasoline is sold for a purpose in section 4221(a)(2), (3), (4), (5), or (6), the Secretary pays the buyer the gallons times the section 4081 rate. This applies despite subsection (f)(2) and (3), and subsection (a) does not apply to that gasoline.
(d) Claims. (1) Unless paragraph (2) applies, a person may file only one claim under each of subsections (a), (b), and (c) for gasoline used during the person’s taxable year*. The claim must meet the income-tax overpayment-claim deadline for that year. (2) Quarterly payments based on aggregate amounts under this section and section 6427 are governed by section 6427(i)(2). (3) For this subsection, gasoline is treated as used for subsection (c)’s purpose when sold for that purpose.
(e) Definitions. (1) “Gasoline” has the section 4083(a) meaning. (2) “Off-highway business use” means use in a trade or business*, or section 212 income-producing activity, other than fuel in a highway vehicle registered or required to be registered for highway use, or, for a U.S.-owned highway vehicle, use on a highway. It normally excludes motorboats, but includes vessels used in fishing or whaling. It includes a vehicle meeting both tests for mobile machinery: (i) its chassis has permanently mounted machinery for construction, manufacturing, processing, farming, mining, drilling, timbering, or similar work unrelated to highway transport; the chassis is specially designed only as the machinery’s carriage, mount, and, where applicable, power source; and the special design prevents use, without substantial structural changes, as a vehicle component for transporting another load; and (ii) public-highway use is under 7,500 miles in the taxable year, disregarding use by a section 501(c) organization exempt under section 501(a).
(f) Exclusions. (1) This section does not apply to gasoline used on a farm for farming purposes within section 6420(c)(1)-(3). (2) It does not apply to aircraft gasoline used in noncommercial aviation, or to commercial aviation for the Leaking Underground Storage Tank Trust Fund* rate and, for fuel bought after September 30, 1995, the part of section 4081(a)(2)(A) not exceeding 4.3 cents per gallon. (3) For gasoline used in a train, it does not apply to that Trust Fund rate or the part of section 4081(a)(2)(A) not exceeding the section 4041(a)(1)(C)(ii) rate.
(g) Applicable law. Section 4081 tax laws, including penalties, apply to these payments as if they were refunds of that tax, when consistent. The Secretary may examine books and witnesses under section 7602(a)(1)-(3) as if the claimant were liable for tax.
(h) Regulations. The Secretary may regulate payment conditions consistently with this section.
(i) Income-tax credit instead. (1) Payments under (a) and (b) go only to the United States or its agency or instrumentality; a State or political subdivision or their agency or instrumentality; or a section 501(a)-exempt organization that need not file a subtitle A return. (2) This limit does not apply to a claim filed under (d)(2). (3) Income-tax credit rules are in section 34.
(j) Cross-references. Excessive-claim penalty: section 6675. Fraud penalties: chapter 75, including section 7201 and following. Indian tribal government* treatment as a State: section 7871.
Except as provided in subsection (i), if gasoline is used in an off-highway business use, the Secretary* shall pay (without interest) to the ultimate purchaser of such gasoline an amount equal to the amount determined by multiplying the number of gallons so used by the rate at which tax was imposed on such gasoline under section 4081. Except as provided in paragraph (2) of subsection (f) of this section, in the case of gasoline used as a fuel in an aircraft, the Secretary shall pay (without interest) to the ultimate purchaser of such gasoline an amount equal to the amount determined by multiplying the number of gallons of gasoline so used by the rate at which tax was imposed on such gasoline under section 4081.
Except as provided in paragraph (2) and subsection (i), if gasoline is used in an automobile bus while engaged in—
furnishing (for compensation) passenger land transportation available to the general public, or
the transportation of students and employees of schools (as defined in the last sentence of section 4221(d)(7)(C)),
the Secretary shall pay (without interest) to the ultimate purchaser of such gasoline an amount equal to the product of the number of gallons of gasoline so used multiplied by the rate at which tax was imposed on such gasoline by section 4081.
Paragraph (1)(A) shall not apply in respect of gasoline used in any automobile bus while engaged in furnishing transportation which is not scheduled and not along regular routes unless the seating capacity of such bus is at least 20 adults (not including the driver).
If gasoline is sold to any person for any purpose described in paragraph (2), (3), (4), (5), or (6) of section 4221(a), the Secretary shall pay (without interest) to such person an amount equal to the product of the number of gallons of gasoline so sold multiplied by the rate at which tax was imposed on such gasoline by section 4081. The preceding sentence shall apply notwithstanding paragraphs (2) and (3) of subsection (f). Subsection (a) shall not apply to gasoline to which this subsection applies.
Except as provided in paragraph (2), not more than one claim may be filed under subsection (a), not more than one claim may be filed under subsection (b), and not more than one claim may be filed under subsection (c), by any person with respect to gasoline used during his taxable year*; and no claim shall be allowed under this paragraph with respect to gasoline used during any taxable year unless filed by such person not later than the time prescribed by law for filing a claim for credit or refund of overpayment of income tax for such taxable year. For purposes of this subsection, a person’s taxable year shall be his taxable year for purposes of subtitle A.
For payments per quarter based on aggregate amounts payable under this section and section 6427, see section 6427(i)(2).
For purposes of this subsection, gasoline shall be treated as used for a purpose referred to in subsection (c) when it is sold for such a purpose.
For purposes of this section—
The term “off-highway business use” means any use by a person in a trade or business* of such person or in an activity of such person described in section 212 (relating to production of income) otherwise than as a fuel in a highway vehicle—
which (at the time of such use), is registered, or is required to be registered, for highway use under the laws of any State or foreign country, or
which, in the case of a highway vehicle owned by the United States, is used on the highway.
Except as otherwise provided in this subparagraph, the term “off-highway business use” does not include any use in a motorboat.
The term “off-highway business use” shall include any use in a vessel employed in the fisheries or in the whaling business.
The term “off-highway business use” shall include any use in a vehicle which meets the requirements described in clause (ii).
The requirements described in this clause are—
the design-based test, and
the use-based test.
For purposes of clause (ii)(I), the design-based test is met if the vehicle consists of a chassis—
to which there has been permanently mounted (by welding, bolting, riveting, or other means) machinery or equipment to perform a construction, manufacturing, processing, farming, mining, drilling, timbering, or similar operation if the operation of the machinery or equipment is unrelated to transportation on or off the public highways,
which has been specially designed to serve only as a mobile carriage and mount (and a power source, where applicable) for the particular machinery or equipment involved, whether or not such machinery or equipment is in operation, and
which, by reason of such special design, could not, without substantial structural modification, be used as a component of a vehicle designed to perform a function of transporting any load other than that particular machinery or equipment or similar machinery or equipment requiring such a specially designed chassis.
For purposes of clause (ii)(II), the use-based test is met if the use of the vehicle on public highways was less than 7,500 miles during the taxpayer’s taxable year. This clause shall be applied without regard to use of the vehicle by any organization which is described in section 501(c) and exempt from tax under section 501(a).
This section shall not apply in respect of gasoline which was (within the meaning of paragraphs (1), (2), and (3) of section 6420(c)) used on a farm for farming purposes.
This section shall not apply in respect of gasoline which is used as a fuel in an aircraft—
in aviation which is not commercial aviation (as defined in section 4083(b)), or
in commercial aviation (as so defined) with respect to the tax imposed by section 4081 at the Leaking Underground Storage Tank Trust Fund* financing rate and, in the case of fuel purchased after September 30, 1995, at so much of the rate specified in section 4081(a)(2)(A) as does not exceed 4.3 cents per gallon.
In the case of gasoline used as a fuel in a train, this section shall not apply with respect to—
the Leaking Underground Storage Tank Trust Fund financing rate under section 4081, and
so much of the rate specified in section 4081(a)(2)(A) as does not exceed the rate applicable under section 4041(a)(1)(C)(ii).
All provisions of law, including penalties, applicable in respect to the tax imposed by section 4081 shall, insofar as applicable and not inconsistent with this section, apply in respect of the payments provided for in this section to the same extent as if such payments constituted refunds of overpayments of the tax so imposed.
For the purpose of ascertaining the correctness of any claim made under this section, or the correctness of any payment made in respect of any such claim, the Secretary shall have the authority granted by paragraphs (1), (2), and (3) of section 7602(a) (relating to examination of books and witnesses) as if the claimant were the person liable for tax.
The Secretary may by regulations prescribe the conditions, not inconsistent with the provisions of this section, under which payments may be made under this section.
Payment shall be made under subsections (a) and (b) only to—
the United States or any agency or instrumentality thereof, a State, a political subdivision of a State, or any agency or instrumentality of one or more States or political subdivisions, or
an organization exempt from tax under section 501(a) (other than an organization required to make a return of the tax imposed under subtitle A for its taxable year).
Paragraph (1) shall not apply to a payment of a claim filed under subsection (d)(2).
For allowance of credit against the tax imposed by subtitle A, see section 34.
For civil penalty for excessive claims under this section, see section 6675.
For fraud penalties, etc., see chapter 75 (section 7201 and following, relating to crimes, other offenses, and forfeitures).
For treatment of an Indian tribal government* as a State (and a subdivision of an Indian tribal government as a political subdivision of a State), see section 7871.
Source credit: (Added June 29, 1956, ch. 462, title II, § 208(c), 70 Stat. 394; amended July 25, 1956, ch. 725, § 2, 70 Stat. 644; Pub. L. 85–859, title I, §§ 163(d)(3), 164(a), Sept. 2, 1958, 72 Stat. 1312; Pub. L. 86–342, title II, § 201(d)(2), Sept. 21, 1959, 73 Stat. 615; Pub. L. 87–61, title II, § 201(e), June 29, 1961, 75 Stat. 124; Pub. L. 87–508, § 5(c)(2), June 28, 1962,76 Stat. 118; Pub. L. 89–44, title VIII, § 809(b), June 21, 1965, 79 Stat. 166; Pub. L. 91–258, title II, §§ 205(b)(1), (c)(8), 207(b), May 21, 1970, 84 Stat. 241, 242, 248; Pub. L. 91–605, title III, § 303(a)(11), Dec. 31, 1970, 84 Stat. 1744; Pub. L. 94–280, title III, § 303(a)(11), May 5, 1976, 90 Stat. 456; Pub. L. 94–455, title XIX, § 1906(a)(27)(A)(i), (B)–(D), (b)(13)(A), Oct. 4, 1976, 90 Stat. 1827, 1828, 1834; Pub. L. 95–599, title V, § 502(a)(10), Nov. 6, 1978, 92 Stat. 2756; Pub. L. 95–618, title II, §§ 222(a)(1), 233(a)(1), (3)(A), Nov. 9, 1978, 92 Stat. 3186, 3190; Pub. L. 96–222, title I, § 108(c)(1), Apr. 1, 1980, 94 Stat. 226; Pub. L. 97–424, title V, §§ 511(c)(1), (3), 515(b)(7), 516(a)(6), Jan. 6, 1983, 96 Stat. 2170, 2171, 2182, 2183; Pub. L. 97–473, title II, § 202(b)(12), Jan. 14, 1983, 96 Stat. 2610; Pub. L. 98–369, div. A, title IV, § 474(r)(38), July 18, 1984, 98 Stat. 846; Pub. L. 99–499, title V, § 521(c)(2), Oct. 17, 1986, 100 Stat. 1778; Pub. L. 99–514, title XVII, § 1703(c)(1), (2)(A), (B), (D), Oct. 22, 1986, 100 Stat. 2776, 2777; Pub. L. 100–17, title V, § 502(b)(7), Apr. 2, 1987, 101 Stat. 257; Pub. L. 100–203, title X, § 10502(d)(9), (10), Dec. 22, 1987, 101 Stat. 1330–444; Pub. L. 100–647, title I, § 1017(c)(6)–(8), (15), title II, § 2001(d)(3)(E), (F), Nov. 10, 1988, 102 Stat. 3576, 3577, 3595; Pub. L. 101–239, title VII, § 7841(d)(20), Dec. 19, 1989, 103 Stat. 2429; Pub. L. 101–508, title XI, § 11211(d)(6), Nov. 5, 1990, 104 Stat. 1388–427; Pub. L. 102–240, title VIII, § 8002(b)(6), Dec. 18, 1991, 105 Stat. 2203; Pub. L. 103–66, title XIII, §§ 13163(b), 13241(f)(6), (7), 13242(d)(20), (22)–(24), Aug. 10, 1993, 107 Stat. 454, 512, 524; Pub. L. 104–188, title I, § 1609(g)(4)(C), Aug. 20, 1996, 110 Stat. 1843; Pub. L. 105–34, title IX, § 902(a), Aug. 5, 1997, 111 Stat. 873; Pub. L. 105–178, title IX, §§ 9006(b)(1), 9009(b)(3), June 9, 1998, 112 Stat. 506, 507; Pub. L. 105–206, title VI, §§ 6010(g)(3), 6023(24)(A), (C), July 22, 1998, 112 Stat. 814, 826; Pub. L. 108–357, title II, § 241(a)(2)(C), title VIII, § 851(d)(1), Oct. 22, 2004, 118 Stat. 1438, 1608; Pub. L. 109–59, title XI, § 11151(b)(3), Aug. 10, 2005, 119 Stat. 1968; Pub. L. 109–280, title XII, § 1207(b)(3)(B), Aug. 17, 2006, 120 Stat. 1070; Pub. L. 115–141, div. U, title IV, § 401(a)(290), (291), Mar. 23, 2018, 132 Stat. 1198.)
- 1956Enacted · Act of June 29, 1956, ch. 462 · 70 Stat. 394
- 1956Amended · Act of July 25, 1956, ch. 725 · 70 Stat. 644
- 1958Amended · Pub. L. 85-859 · 72 Stat. 1312
- 1959Amended · Pub. L. 86-342 · 73 Stat. 615
- 1961Amended · Pub. L. 87-61 · 75 Stat. 124
- 1962Amended · Pub. L. 87-508 · 76 Stat. 118
- 1965Amended · Pub. L. 89-44 · 79 Stat. 166
- 1970Amended · Pub. L. 91-258 · 84 Stat. 241, 242, 248
- 1970Amended · Pub. L. 91-605 · 84 Stat. 1744
- 1976Amended · Pub. L. 94-280 · 90 Stat. 456
- 1976Amended · Pub. L. 94-455 · 90 Stat. 1827, 1828, 1834
- 1978Amended · Pub. L. 95-599 · 92 Stat. 2756
- 1978Amended · Pub. L. 95-618 · 92 Stat. 3186, 3190
- 1980Amended · Pub. L. 96-222 · 94 Stat. 226
- 1983Amended · Pub. L. 97-424 · 96 Stat. 2170, 2171, 2182, 2183
- 1983Amended · Pub. L. 97-473 · 96 Stat. 2610
- 1984Amended · Pub. L. 98-369 · 98 Stat. 846
- 1986Amended · Pub. L. 99-499 · 100 Stat. 1778
- 1986Amended · Pub. L. 99-514 · 100 Stat. 2776, 2777
- 1987Amended · Pub. L. 100-17 · 101 Stat. 257
- 1987Amended · Pub. L. 100-203 · 101 Stat. 1330
- 1988Amended · Pub. L. 100-647 · 102 Stat. 3576, 3577, 3595
- 1989Amended · Pub. L. 101-239 · 103 Stat. 2429
- 1990Amended · Pub. L. 101-508 · 104 Stat. 1388
- 1991Amended · Pub. L. 102-240 · 105 Stat. 2203
- 1993Amended · Pub. L. 103-66 · 107 Stat. 454, 512, 524
- 1996Amended · Pub. L. 104-188 · 110 Stat. 1843
- 1997Amended · Pub. L. 105-34 · 111 Stat. 873
- 1998Amended · Pub. L. 105-178 · 112 Stat. 506, 507
- 1998Amended · Pub. L. 105-206 · 112 Stat. 814, 826
- 2004Amended · Pub. L. 108-357 · 118 Stat. 1438, 1608
- 2005Amended · Pub. L. 109-59 · 119 Stat. 1968
- 2006Amended · Pub. L. 109-280 · 120 Stat. 1070
- 2018Amended · Pub. L. 115-141 · 132 Stat. 1198
A history note hasn’t been published yet. The record shows enactment by ch. 462 on 1956-06-29.
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