[Code of Federal Regulations]
[Title 26, Volume 18]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR301.6316-5]

[Page 215-216]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 301_PROCEDURE AND ADMINISTRATION--Table of Contents
 
                               Collection
 
Sec. 301.6316-5  Manner of paying tax by foreign currency.

    (a) Time and place to pay. The unpaid tax required to be shown on a 
return filed in accordance with Sec. 301.6316-4, whether payable in 
whole or in part in foreign currency, is due and payable to the Director 
of International Operations, Internal Revenue Service, Washington, D.C. 
20225, at the time the return is filed. However, see paragraph (d) of 
this section with respect to the depositing of the foreign currency with 
the disbursing officer of the Department of State.
    (b) Certified statement. Every taxpayer who desires to pay tax in 
foreign currency under the provisions of Sec. 301.6316-1 shall first 
obtain the certified statement referred to in paragraph (b)(1) of Sec. 
301.6316-4.
    (c) Determination of the tax. In determining the tax payable for the 
taxable year in U.S. dollars, the taxpayer, with respect to amounts 
described in paragraph (a) of Sec. 301.6316-1, or amounts described in 
paragraph (b) of Sec. 301.6316-1 received before November 1, 1965, 
shall use the rates of exchange which most clearly reflect the correct 
tax liability in dollars, whether it be the official rate, the open 
market rate, or any other appropriate rate. With respect to amounts 
described in paragraph (b) of Sec. 301.6316-1 received on or after 
November 1, 1965, the taxpayer shall use the official rate of exchange 
in determining the tax payable for the taxable year in U.S. dollars. 
After determining the correct tax liability in U.S. dollars the taxpayer 
shall then ascertain, in accordance with the principles of Sec. 
301.6316-3, the portion of the tax which is attributable to amounts 
received in noncon vertible foreign currency.
    (d) Deposit of foreign currency with disbursing officer. (1) After 
the portion of the tax which is attributable to amounts received in 
nonconvertible foreign currency is determined in U.S. dollars, the 
amount so determined shall be deposited in the same nonconvertible 
foreign currency with the disbursing officer of the Department of State 
for the foreign country where the fund is located from which the 
payments in nonconvertible foreign currency are made to the taxpayer. 
The amount of foreign currency to be deposited shall be that amount 
which, when converted at the rate of exchange used on the date of 
deposit by that disbursing officer for the acquisition of such currency 
for his official disbursements, equals the portion of the tax so 
determined in U.S. dollars.
    (2) The disbursing officer may rely upon the taxpayer for the 
determination of the amount of tax payable in foreign currency but may 
not accept any such currency for deposit until the taxpayer has 
presented for inspection the certified statement referred to in 
paragraph (b)(1) of Sec. 301.6316-4. Upon acceptance of foreign 
currency for deposit the disbursing officer shall give the taxpayer a 
receipt in duplicate showing the name and address of the

[[Page 216]]

depositor, the date of the deposit, the amount of foreign currency 
deposited, and its equivalent in U.S. dollars on the date of deposit.
    (3) Every taxpayer making a deposit of foreign currency in 
accordance with this paragraph shall attach to the return required to be 
filed in accordance with Sec. 301.6316-4, in part or full payment of 
the taxes shown thereon, the original of the receipt given by the 
disbursing officer and shall pay to the Director of International 
Operations in U.S. dollars the balance, if any, of the tax shown to be 
due. Tender of such receipt to the Director of International Operations 
shall be considered as payment of tax in an amount equal to the U.S. 
dollars represented by the receipt.
    (4) A taxpayer shall make the deposit required by this paragraph in 
ample time to permit him to attach the receipt to his return for filing 
within the time prescribed by section 6072 or 6081 and Sec. Sec. 
1.6072-1, 1.6081-1, and 1.6081-2 of this chapter (Income Tax 
Regulations).