[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: 26CFR48.6421-2]

[Page 216-217]
 
                       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 O_Refunds and Other Administrative Provisions of Special 
            Application to Retailers and Manufacturers Taxes
 
Sec. 48.6421-2  Credits or payments to ultimate purchasers of gasoline 
used in intercity, local, or school buses.

    (a) In general. If gasoline is used in an intercity or local bus 
while engaged in furnishing (for compensation) passenger land 
transportation available to the general public or in a school bus 
engaged in the transportation of students or employees of schools, a 
credit (under the circumstances described in paragraph (b) of this 
section) or a payment (under the circumstances described in paragraph 
(c) of this section) in respect to the gasoline shall be allowed or made 
to the ultimate purchaser of the gasoline. The credit or payment under 
this section shall be 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 the gasoline by section 4081. No interest shall be paid on 
any payment allowed under paragraph (c) of this section. However, 
interest may be paid on an overpayment (as defined by section 6401) 
arising from a credit allowed under paragraph (b) of this section. See 
section 34(a) relating to credit for certain uses of gasoline and 
special fuels, (and lubricating oil used prior to January 7, 1983). See 
Sec. 48.6421-3 for the time within which a claim for credit or payment 
must be made under this section. See Sec. 48.6421-4 for the meaning of 
``gasoline.''

[[Page 217]]

    (b) Allowance of income tax credit. Except as provided in paragraph 
(c) of this section, repayment under this section of the tax paid under 
section 4081 of gasoline used while engaged in furnishing (for 
compensation) passenger land transportation available to the general 
public or in school bus transportation operations by a person subject to 
income tax may be obtained only by claiming a credit for the amount of 
this tax against the tax imposed by subtitle A of the Code. The amount 
of the credit shall be an amount equal to the payment which would be 
made under section 6421 with respect to gasoline used during the taxable 
year for this passenger land transportation or school bus operations if 
section 6421(i) and paragraph (c) of this section did not apply. See 
section 34(a)(2).
    (c) Allowance of payment. Payments in respect of gasoline upon which 
tax was paid under section 4081 that is used while engaged in furnishing 
(for compensation) passenger land transportation available to the 
general public or in school bus transportation operations shall be made 
only to--
    (1) The United States or any agency or instrumentality thereof, a 
State, or political subdivision of a State, or an agency or 
instrumentality of one or more States or political subdivisions of a 
State, or the District of Columbia,
    (2) An organization which is exempt from tax under section 501(a) 
and is not required to make a return of the income tax imposed under 
subtitle A for its taxable year, or
    (3) A person described in section 6421(c)(2) to whom $1,000 or more 
is payable (without regard to paragraph (b) of this section) under this 
section with respect to gasoline used during any of the first three 
quarters of the person's taxable year.
    (d) Supporting evidence required. Each claim under this section for 
credit or payment must include a statement showing--
    (1) The total number of gallons of gasoline purchased and used 
during the period covered by the claim for each intercity or local bus 
while engaged in furnishing (for compensation) passenger land 
transportation available to the general public multiplied by the rate at 
which tax was imposed on the gasoline by section 4081.
    (2) The total number of gallons of gasoline purchased and used in 
each bus while engaged in school bus transportation operations 
multiplied by the rate at which tax was imposed on the gasoline by 
section 4081, and
    (3) If a claim on Form 843 is being filed, the internal revenue 
district or service center with which the claimant last filed an income 
tax return (if any).

[T.D. 8043, 50 FR 32040, Aug. 8, 1985, as amended by T.D. 8879, 65 FR 
17161, Mar. 31, 2000]