[Code of Federal Regulations]
[Title 26, Volume 16]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR48.4041-5]

[Page 55-56]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 48_MANUFACTURERS AND RETAILERS EXCISE TAXES--Table of Contents
 
                         Subpart F_Special Fuels
 
Sec. 48.4041-5  Sales of diesel and special motor fuels and fuel for 
use in aircraft; rules of general application.

    (a) Taxability of liquid fuel delivered into purchaser's tanks--(1) 
Fuel supply tanks. (i) The sale of diesel fuel to an owner, lessee, or 
other operator of a diesel-powered highway vehicle, or of special motor 
fuel to an owner, lessee, or other operator of a motor vehicle or 
motorboat, or of fuel to an owner, lessee, or other operator of an 
aircraft used in noncommercial aviation is considered a taxable sale of 
the liquid fuel if the liquid fuel is delivered by the seller into the 
fuel supply tank of the vehicle, motorboat, or aircraft. For purpose of 
this paragraph (a), liquid fuel sold at a location unattended by the 
seller (such as under a cardlock or meter system) on or after January 2, 
1986, is considered to be delivered into the fuel supply tank by the 
seller except as provided in paragraph (a)(1)(ii) of this section. In 
this regard, see section 6427(a) for credit or refund of tax if liquid 
fuel acquired in a transaction subject to tax is used in a nontaxable 
use.
    (ii) If the seller maintains special devices at the unattended 
location to account accurately for sales of liquid fuel for nontaxable 
uses (such as assigning a separate ``nontaxable'' meter or, in a 
cardlock system, issuing a special ``nontaxable'' card to a customer who 
regularly purchases fuel for nontaxable uses), then such sales of liquid 
fuel shall be considered nontaxable. The seller must maintain sufficient 
records of such nontaxable sales and include in these records the name 
of the purchaser, the date of the purchase, and the quantity of fuel 
purchased in each sale.
    (2) Bulk tanks. The sale of diesel fuel to an owner, lessee, or 
other operator of a diesel-powered highway vehicle, or of special motor 
fuel to an owner, lessee, or other operator of a motor vehicle or 
motorboat, or of fuel to an owner, lessee, or other operator of an 
aircraft used in noncommercial aviation is considered a taxable sale of 
the liquid fuel if--
    (i) The liquid fuel is delivered by the seller into a bulk supply 
tank (or other container) that is not the fuel supply tank of a vehicle, 
motorboat, or aircraft; and
    (ii) The purchaser furnishes a written statement to the seller 
before or at the time of the sale stating that the entire quantity of 
the liquid fuel covered by the sale is for a taxable purpose as a fuel 
in such a vehicle, motorboat, or aircraft.

[[Page 56]]


If the purchaser fails to provide the written statement required by 
paragraph (a)(2)(ii) of this section, the purchaser is liable for the 
tax on the later taxable sale or use. If a purchaser acquires both fuel 
that is to be used for taxable purposes and fuel that is to be used for 
nontaxable purposes, and the fuel that is to be used for taxable 
purposes is stored in a different storage tank (or container) from the 
tank used to store the fuel to be used for nontaxable purposes, the 
written statement described in paragraph (a)(2)(ii) of this section will 
relate to the fuel to be used for taxable purposes if proper records are 
kept by the purchaser that sufficiently identify the tanks (or 
containers) into which tax-paid fuel is delivered and the quantities of 
fuel delivered into those tanks (or containers). If only occasional 
sales for delivery into a bulk storage tank (or other container) are 
made to a purchaser, a separate statement must be furnished for each 
order. However, if sales are regularly or frequently made to a 
purchaser, a written statement covering all orders for a specified 
period not to exceed 12 calendar quarters is acceptable.
    (b) Sales for resale and to consignees. (1) A sale to a dealer for 
resale is not subject to tax even if it is known at the time of the sale 
that the liquid fuel will be resold by the dealer for use as a fuel in a 
diesel-powered highway vehicle, motor vehicle, motorboat, or aircraft.
    (2) The tax is payable by the person who makes the taxable sale. If 
a taxable liquid fuel is consigned to a person for sale and the 
consignor retains ownership in the liquid fuel until it is disposed of 
by the consignee, the consignor is the person liable for the tax when a 
taxable sale of the liquid fuel is made by the consignee. If the 
consignor transfers ownership in the taxable liquid fuel to the 
consignee before sale of the liquid fuel by the consignee, the consignee 
is the person liable for the tax upon a subsequent taxable sale of the 
liquid. However, if ownership of the liquid fuel is transferred back to 
the consignor or to another person before a taxable sale is made, as 
described in paragraph (a) of this section, and thereafter a taxable 
sale of the liquid fuel is made by such person or by another person 
acting as the person's agent, such person is liable for the tax. See 
paragraph (d) of Sec. 48.4041-8 for definition of the term ``taxable 
liquid fuel.''

[T.D. 8066, 51 FR 15, Jan. 2, 1986, as amended by T.D. 8154, 52 FR 
32008, Aug. 25, 1987]