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Free tax services online Internal Revenue Bulletin:  2012-14  April 2, 2012  Rev. Free tax services online Proc. Free tax services online 2012-23 Table of Contents SECTION 1. Free tax services online PURPOSE SECTION 2. Free tax services online BACKGROUND SECTION 3. Free tax services online SCOPE SECTION 4. Free tax services online APPLICATION. Free tax services online 01 Limitations on Depreciation Deductions for Certain Automobiles. Free tax services online . Free tax services online 02 Inclusions in Income of Lessees of Passenger Automobiles. Free tax services online SECTION 5. Free tax services online EFFECTIVE DATE SECTION 6. Free tax services online DRAFTING INFORMATION SECTION 1. Free tax services online PURPOSE This revenue procedure provides: (1) limitations on depreciation deductions for owners of passenger automobiles first placed in service by the taxpayer during calendar year 2012, including separate tables of limitations on depreciation deductions for trucks and vans; and (2) the amounts that must be included in income by lessees of passenger automobiles first leased by the taxpayer during calendar year 2012, including a separate table of inclusion amounts for lessees of trucks and vans. Free tax services online The tables detailing these depreciation limitations and lessee inclusion amounts reflect the automobile price inflation adjustments required by § 280F(d)(7) of the Internal Revenue Code. Free tax services online SECTION 2. Free tax services online BACKGROUND . Free tax services online 01 For owners of passenger automobiles, § 280F(a) imposes dollar limitations on the depreciation deduction for the year the taxpayer places the passenger automobile in service and for each succeeding year. Free tax services online For passenger automobiles placed in service after 1988, § 280F(d)(7) requires the Internal Revenue Service to increase the amounts allowable as depreciation deductions by a price inflation adjustment amount. Free tax services online The method of calculating this price inflation amount for trucks and vans placed in service in or after calendar year 2003 uses a different CPI “automobile component” (the “new trucks” component) than that used in the price inflation amount calculation for other passenger automobiles (the “new cars” component), resulting in somewhat higher depreciation deductions for trucks and vans. Free tax services online This change reflects the higher rate of price inflation for trucks and vans since 1988. Free tax services online . Free tax services online 02 Section 401(a) of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Pub. Free tax services online L. Free tax services online No. Free tax services online 111-312, 124 Stat. Free tax services online 3296 (Dec. Free tax services online 17, 2010) (the “Act”) extended the 50 percent additional first year depreciation deduction under § 168(k) to qualified property acquired by the taxpayer after December 31, 2007, and before January 1, 2013, if no written binding contract for the acquisition of the property existed before January 1, 2008, and if the taxpayer places the property in service generally before January 1, 2013. Free tax services online Section 168(k)(2)(F)(i) increases the first year depreciation allowed under § 280F(a)(1)(A)(i) by $8,000 for passenger automobiles to which the additional first year depreciation deduction under § 168(k) (hereinafter, referred to as “§ 168(k) additional first year depreciation deduction”) applies. Free tax services online . Free tax services online 03 Section 168(k)(2)(D)(i) provides that the § 168(k) additional first year depreciation deduction does not apply to any property required to be depreciated under the alternative depreciation system of § 168(g), including property described in § 280F(b)(1). Free tax services online Section 168(k)(2)(D)(iii) permits a taxpayer to elect out of the § 168(k) additional first year depreciation deduction for any class of property. Free tax services online Section 168(k)(4), as amended by the Act, permits a corporation to elect to increase the alternative minimum tax (“AMT”) credit limitation under § 53(c), instead of claiming the § 168(k) additional first year depreciation deduction for all eligible qualified property placed in service after December 31, 2010, that is round 2 extension property (as defined in § 168(k)(4)(I)(iv)). Free tax services online Accordingly, this revenue procedure provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction applies. Free tax services online This revenue procedure also provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction does not apply, either because taxpayer (1) purchased the passenger automobile used; (2) did not use the passenger automobile during 2012 more than 50 percent for business purposes; (3) elected out of the § 168(k) additional first year depreciation deduction pursuant to § 168(k)(2)(D)(iii); or (4) elected to increase the § 53 AMT credit limitation in lieu of claiming § 168(k) additional first year depreciation. Free tax services online . Free tax services online 04 Section 280F(c) requires a reduction in the deduction allowed to the lessee of a leased passenger automobile. Free tax services online The reduction must be substantially equivalent to the limitations on the depreciation deductions imposed on owners of passenger automobiles. Free tax services online Under § 1. Free tax services online 280F-7(a) of the Income Tax Regulations, this reduction requires a lessee to include in gross income an amount determined by applying a formula to the amount obtained from a table. Free tax services online One table applies to lessees of trucks and vans and another table applies to all other passenger automobiles. Free tax services online Each table shows inclusion amounts for a range of fair market values for each taxable year after the passenger automobile is first leased. Free tax services online SECTION 3. Free tax services online SCOPE . Free tax services online 01 The limitations on depreciation deductions in section 4. Free tax services online 01(2) of this revenue procedure apply to passenger automobiles (other than leased passenger automobiles) that are placed in service by the taxpayer in calendar year 2012, and continue to apply for each taxable year that the passenger automobile remains in service. Free tax services online . Free tax services online 02 The tables in section 4. Free tax services online 02 of this revenue procedure apply to leased passenger automobiles for which the lease term begins during calendar year 2012. Free tax services online Lessees of these passenger automobiles must use these tables to determine the inclusion amount for each taxable year during which the passenger automobile is leased. Free tax services online See Rev. Free tax services online Proc. Free tax services online 2007-30, 2007-1 C. Free tax services online B. Free tax services online 1104, for passenger automobiles first leased during calendar year 2007; Rev. Free tax services online Proc. Free tax services online 2008-22, 2008-1 C. Free tax services online B. Free tax services online 658, for passenger automobiles first leased during calendar year 2008; Rev. Free tax services online Proc. Free tax services online 2009-24, 2009-17 I. Free tax services online R. Free tax services online B. Free tax services online 885, for passenger automobiles first leased during calendar year 2009; Rev. Free tax services online Proc. Free tax services online 2010-18, 2010-9 I. Free tax services online R. Free tax services online B. Free tax services online 427, as amplified and modified by section 4. Free tax services online 03 of Rev. Free tax services online Proc. Free tax services online 2011-21, 2011-12 I. Free tax services online R. Free tax services online B. Free tax services online 560, for passenger automobiles first leased during calendar year 2010; and Rev. Free tax services online Proc. Free tax services online 2011-21, for passenger automobiles first leased during calendar year 2011. Free tax services online SECTION 4. Free tax services online APPLICATION . Free tax services online 01 Limitations on Depreciation Deductions for Certain Automobiles. Free tax services online (1) Amount of the inflation adjustment. Free tax services online (a) Passenger automobiles (other than trucks or vans). Free tax services online Under § 280F(d)(7)(B)(i), the automobile price inflation adjustment for any calendar year is the percentage (if any) by which the CPI automobile component for October of the preceding calendar year exceeds the CPI automobile component for October 1987. Free tax services online Section 280F(d)(7)(B)(ii) defines the term “CPI automobile component” as the automobile component of the Consumer Price Index for all Urban Consumers published by the Department of Labor. Free tax services online The new car component of the CPI was 115. Free tax services online 2 for October 1987 and 143. Free tax services online 419 for October 2011. Free tax services online The October 2011 index exceeded the October 1987 index by 28. Free tax services online 219. Free tax services online Therefore, the automobile price inflation adjustment for 2012 for passenger automobiles (other than trucks and vans) is 24. Free tax services online 5 percent (28. Free tax services online 219/115. Free tax services online 2 x 100%). Free tax services online The dollar limitations in § 280F(a) are multiplied by a factor of 0. Free tax services online 245, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations applicable to passenger automobiles (other than trucks and vans) for calendar year 2012. Free tax services online This adjustment applies to all passenger automobiles (other than trucks and vans) that are first placed in service in calendar year 2012. Free tax services online (b) Trucks and vans. Free tax services online To determine the dollar limitations for trucks and vans first placed in service during calendar year 2012, the Service uses the new truck component of the CPI instead of the new car component. Free tax services online The new truck component of the CPI was 112. Free tax services online 4 for October 1987 and 146. Free tax services online 607 for October 2011. Free tax services online The October 2011 index exceeded the October 1987 index by 34. Free tax services online 207. Free tax services online Therefore, the automobile price inflation adjustment for 2012 for trucks and vans is 30. Free tax services online 43 percent (34. Free tax services online 207/112. Free tax services online 4 x 100%). Free tax services online The dollar limitations in § 280F(a) are multiplied by a factor of 0. Free tax services online 3043, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations for trucks and vans. Free tax services online This adjustment applies to all trucks and vans that are first placed in service in calendar year 2012. Free tax services online (2) Amount of the limitation. Free tax services online Tables 1 through 4 contain the dollar amount of the depreciation limitation for each taxable year for passenger automobiles a taxpayer places in service in calendar year 2012. Free tax services online Use Table 1 for a passenger automobile (other than a truck or van), and Table 2 for a truck or van, placed in service in calendar year 2012 for which the § 168(k) additional first year depreciation deduction applies. Free tax services online Use Table 3 for a passenger automobile (other than a truck or van), and Table 4 for a truck or van, placed in service in calendar year 2012 for which the § 168(k) additional first year depreciation deduction does not apply. Free tax services online REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 1 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 2 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,360 2nd Tax Year $5,300 3rd Tax Year $3,150 Each Succeeding Year $1,875 REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 3 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 4 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,360 2nd Tax Year $5,300 3rd Tax Year $3,150 Each Succeeding Year $1,875 . Free tax services online 02 Inclusions in Income of Lessees of Passenger Automobiles. Free tax services online A taxpayer must follow the procedures in § 1. Free tax services online 280F-7(a) for determining the inclusion amounts for passenger automobiles first leased in calendar year 2012. Free tax services online In applying these procedures, lessees of passenger automobiles other than trucks and vans should use Table 5 of this revenue procedure, while lessees of trucks and vans should use Table 6 of this revenue procedure. Free tax services online REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 5 DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2012 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $18,500 $19,000 2 4 5 6 8 19,000 19,500 2 4 7 7 9 19,500 20,000 2 5 8 8 10 20,000 20,500 3 5 9 10 11 20,500 21,000 3 6 9 12 12 21,000 21,500 3 7 10 12 14 21,500 22,000 3 8 11 13 16 22,000 23,000 4 8 13 15 17 23,000 24,000 4 10 15 17 20 24,000 25,000 5 11 17 19 23 25,000 26,000 6 12 19 21 26 26,000 27,000 6 14 20 24 28 27,000 28,000 7 15 22 26 31 28,000 29,000 7 16 25 28 33 29,000 30,000 8 18 25 32 35 30,000 31,000 9 19 27 34 38 31,000 32,000 9 20 30 36 41 32,000 33,000 10 21 32 38 43 33,000 34,000 10 23 33 41 46 34,000 35,000 11 24 35 43 49 35,000 36,000 12 25 37 45 52 36,000 37,000 12 27 39 47 54 37,000 38,000 13 28 41 49 57 38,000 39,000 13 29 43 52 59 39,000 40,000 14 30 45 54 62 40,000 41,000 14 32 47 56 65 41,000 42,000 15 33 49 58 68 42,000 43,000 16 34 51 61 70 43,000 44,000 16 36 52 63 73 44,000 45,000 17 37 54 66 75 45,000 46,000 17 38 57 67 78 46,000 47,000 18 39 59 70 80 47,000 48,000 19 40 61 72 83 48,000 49,000 19 42 62 75 86 49,000 50,000 20 43 64 77 89 50,000 51,000 20 45 66 79 91 51,000 52,000 21 46 68 81 94 52,000 53,000 21 47 70 84 96 53,000 54,000 22 48 72 86 99 54,000 55,000 23 49 74 88 102 55,000 56,000 23 51 76 90 104 56,000 57,000 24 52 78 92 107 57,000 58,000 24 54 79 95 110 58,000 59,000 25 55 81 97 113 59,000 60,000 26 56 83 100 115 60,000 62,000 26 58 86 103 119 62,000 64,000 28 60 90 108 124 64,000 66,000 29 63 94 112 129 66,000 68,000 30 66 97 117 135 68,000 70,000 31 68 102 121 140 70,000 72,000 32 71 105 126 145 72,000 74,000 33 74 109 130 151 74,000 76,000 35 76 113 135 156 76,000 78,000 36 78 117 140 161 78,000 80,000 37 81 120 145 166 80,000 85,000 39 86 127 152 176 85,000 90,000 42 92 137 163 189 90,000 95,000 45 98 147 175 202 95,000 100,000 48 105 155 187 215 100,000 110,000 52 115 170 203 235 110,000 120,000 58 127 189 227 262 120,000 130,000 64 140 208 250 288 130,000 140,000 70 153 227 272 315 140,000 150,000 75 166 246 296 340 150,000 160,000 81 179 265 318 368 160,000 170,000 87 192 284 341 394 170,000 180,000 93 204 304 364 420 180,000 190,000 99 217 323 387 446 190,000 200,000 105 230 342 409 473 200,000 210,000 111 243 361 432 499 210,000 220,000 116 256 380 455 526 220,000 230,000 122 269 399 478 552 230,000 240,000 128 282 418 501 578 240,000 and up 134 294 437 524 605 REV. Free tax services online PROC. Free tax services online 2012-23 TABLE 6 DOLLAR AMOUNTS FOR TRUCKS AND VANS WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2012 Fair Market Value of Truck or Van Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $19,000 $19,500 1 4 5 6 7 19,500 20,000 2 4 6 7 9 20,000 20,500 2 5 7 8 10 20,500 21,000 2 5 8 10 11 21,000 21,500 3 6 9 10 13 21,500 22,000 3 6 10 12 14 22,000 23,000 3 8 11 14 15 23,000 24,000 4 9 13 16 18 24,000 25,000 4 10 15 19 21 25,000 26,000 5 11 17 21 24 26,000 27,000 6 12 19 23 26 27,000 28,000 6 14 21 25 29 28,000 29,000 7 15 23 27 32 29,000 30,000 7 17 24 30 34 30,000 31,000 8 18 26 32 37 31,000 32,000 9 19 28 34 40 32,000 33,000 9 20 31 36 42 33,000 34,000 10 21 33 39 44 34,000 35,000 10 23 34 41 48 35,000 36,000 11 24 36 44 50 36,000 37,000 12 25 38 46 53 37,000 38,000 12 27 40 48 55 38,000 39,000 13 28 42 50 58 39,000 40,000 13 29 44 53 60 40,000 41,000 14 31 45 55 63 41,000 42,000 14 32 48 57 66 42,000 43,000 15 33 50 59 69 43,000 44,000 16 34 52 61 72 44,000 45,000 16 36 53 64 74 45,000 46,000 17 37 55 66 77 46,000 47,000 17 38 58 68 79 47,000 48,000 18 40 59 70 82 48,000 49,000 19 41 61 73 84 49,000 50,000 19 42 63 75 87 50,000 51,000 20 43 65 78 89 51,000 52,000 20 45 66 80 93 52,000 53,000 21 46 68 83 95 53,000 54,000 21 48 70 84 98 54,000 55,000 22 49 72 87 100 55,000 56,000 23 50 74 89 103 56,000 57,000 23 51 76 92 105 57,000 58,000 24 52 78 94 108 58,000 59,000 24 54 80 96 111 59,000 60,000 25 55 82 98 114 60,000 62,000 26 57 85 101 118 62,000 64,000 27 60 88 106 123 64,000 66,000 28 62 93 110 128 66,000 68,000 29 65 96 115 134 68,000 70,000 30 67 100 120 139 70,000 72,000 32 70 103 125 144 72,000 74,000 33 72 108 129 149 74,000 76,000 34 75 111 134 155 76,000 78,000 35 78 115 138 160 78,000 80,000 36 80 119 143 165 80,000 85,000 38 85 125 151 175 85,000 90,000 41 91 135 163 187 90,000 95,000 44 98 144 174 201 95,000 100,000 47 104 154 185 214 100,000 110,000 52 113 169 202 234 110,000 120,000 57 127 187 225 261 120,000 130,000 63 139 207 248 287 130,000 140,000 69 152 226 271 313 140,000 150,000 75 165 245 294 339 150,000 160,000 81 178 264 316 366 160,000 170,000 87 190 283 340 392 170,000 180,000 92 204 302 362 419 180,000 190,000 98 216 322 385 445 190,000 200,000 104 229 340 409 471 200,000 210,000 110 242 359 431 498 210,000 220,000 116 255 378 454 524 220,000 230,000 122 267 398 477 551 230,000 240,000 127 281 416 500 577 240,000 and up 133 294 435 523 603 SECTION 5. Free tax services online EFFECTIVE DATE This revenue procedure applies to passenger automobiles that a taxpayer first places in service or first leases during calendar year 2012. Free tax services online SECTION 6. Free tax services online DRAFTING INFORMATION The principal author of this revenue procedure is Bernard P. Free tax services online Harvey of the Office of Associate Chief Counsel (Income Tax & Accounting). Free tax services online For further information regarding this revenue procedure, contact Mr. Free tax services online Harvey at (202) 622-4930 (not a toll-free call). Free tax services online Prev  Up  Next   Home   More Internal Revenue Bulletins
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Understanding Your CP2566 Notice

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Free tax services online 3. Free tax services online   Environmental Taxes Table of Contents Oil Spill Liability Tax ODCs Imported Taxable Products Floor Stocks Tax Environmental taxes are imposed on crude oil and petroleum products (oil spill liability), the sale or use of ozone-depleting chemicals (ODCs), and imported products containing or manufactured with ODCs. Free tax services online In addition, a floor stocks tax is imposed on ODCs held on January 1 by any person (other than the manufacturer or importer of the ODCs) for sale or for use in further manufacture. Free tax services online Figure the environmental tax on Form 6627. Free tax services online Enter the tax on the appropriate lines of Form 720 and attach Form 6627 to Form 720. Free tax services online For environmental tax purposes, United States includes the 50 states, the District of Columbia, the Commonwealth of Puerto Rico, any possession of the United States, the Commonwealth of the Northern Mariana Islands, the Trust Territory of the Pacific Islands, the continental shelf areas (applying the principles of section 638), and foreign trade zones. Free tax services online No one is exempt from the environmental taxes, including the federal government, state and local governments, Indian tribal governments, and nonprofit educational organizations. Free tax services online Oil Spill Liability Tax The oil spill liability tax is reported on Form 6627, Environmental Taxes, and Form 720, Quarterly Federal Excise Tax Return (IRS Nos. Free tax services online 18 and 21). Free tax services online The oil spill liability tax rate is $. Free tax services online 08 per barrel and generally applies to crude oil received at a U. Free tax services online S. Free tax services online refinery and to petroleum products entered into the United States for consumption, use, or warehousing. Free tax services online The tax also applies to certain uses and the exportation of domestic crude oil. Free tax services online Crude oil includes crude oil condensates and natural gasoline. Free tax services online Petroleum products include crude oil, refined and residual oil, and other liquid hydrocarbon refinery products. Free tax services online Crude oil. Free tax services online   Tax is imposed on crude oil when it is received at a United Sates refinery. Free tax services online The operator of the refinery is liable for the tax. Free tax services online   Tax is imposed on domestic crude oil used or exported before it is received at a United States refinery. Free tax services online However, the use of crude oil for extracting oil or natural gas on the premises where such crude oil was produced is not taxable. Free tax services online The user or exporter is liable for the tax. Free tax services online Imported petroleum products. Free tax services online   Tax is imposed on petroleum products when they enter the United States for consumption, use, or warehousing. Free tax services online The person entering the petroleum product into the country is liable for the tax, including the tax on imported crude oil, even if it is subsequently received at a U. Free tax services online S. Free tax services online refinery. Free tax services online   Tax is imposed only once on any imported petroleum product. Free tax services online Thus, the operator of a U. Free tax services online S. Free tax services online refinery that receives imported crude oil must establish that the petroleum tax has already been imposed on such crude oil in order not to be liable for the tax. Free tax services online ODCs For a list of the taxable ODCs and tax rates, see the Form 6627 instructions. Free tax services online Taxable event. Free tax services online   Tax is imposed on an ODC when it is first used or sold by its manufacturer or importer. Free tax services online The manufacturer or importer is liable for the tax. Free tax services online Use of ODCs. Free tax services online   You use an ODC if you put it into service in a trade or business or for the production of income. Free tax services online Also, an ODC is used if you use it in the making of an article, including incorporation into the article, chemical transformation, or release into the air. Free tax services online The loss, destruction, packaging, repackaging, or warehousing of ODCs is not a use of the ODC. Free tax services online   The creation of a mixture containing an ODC is treated as a taxable use of the ODC contained in the mixture. Free tax services online An ODC is contained in a mixture only if the chemical identity of the ODC is not changed. Free tax services online Generally, tax is imposed when the mixture is created and not on its sale or use. Free tax services online However, you can choose to have the tax imposed on its sale or use by checking the appropriate box on Form 6627. Free tax services online You can revoke this choice only with IRS consent. Free tax services online   The creation of a mixture for export or for use as a feedstock is not a taxable use of the ODCs contained in the mixture. Free tax services online Exceptions. Free tax services online   The following may be exempt from the tax on ODCs. Free tax services online Metered-dose inhalers. Free tax services online Recycled ODCs. Free tax services online Exported ODCs. Free tax services online ODCs used as feedstock. Free tax services online Metered-dose inhalers. Free tax services online   There is no tax on ODCs used or sold for use as propellants in metered-dose inhalers. Free tax services online For a sale to be nontaxable, you must obtain from the purchaser an exemption certificate that you rely on in good faith. Free tax services online The certificate must be in substantially the form as the sample certificate set forth in Regulations section 52. Free tax services online 4682-2(d)(5). Free tax services online The certificate may be included as part of the sales documentation. Free tax services online Keep the certificate with your records. Free tax services online Recycled ODCs. Free tax services online   There is no tax on any ODC diverted or recovered in the United States as part of a recycling process (and not as part of the original manufacturing or production process). Free tax services online There is no tax on recycled Halon-1301 or recycled Halon-2402 imported from a country that has signed the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol). Free tax services online   The Montreal Protocol is administered by the United Nations (U. Free tax services online N. Free tax services online ). Free tax services online To determine if a country has signed the Montreal Protocol, contact the U. Free tax services online N. Free tax services online The website is untreaty. Free tax services online un. Free tax services online org. Free tax services online Exported ODCs. Free tax services online   Generally, there is no tax on ODCs sold for export if certain requirements are met. Free tax services online For a sale to be nontaxable, you and the purchaser must be registered. Free tax services online See Form 637, Application for Registration (for Certain Excise Tax Activities). Free tax services online Also, you must obtain from the purchaser an exemption certificate that you rely on in good faith. Free tax services online Keep the certificate with your records. Free tax services online The certificate must be in substantially the form as the sample certificate set forth in Regulations section 52. Free tax services online 4682-5(d)(3). Free tax services online The tax benefit of this exemption is limited. Free tax services online For more information, see Regulations section 52. Free tax services online 4682-5. Free tax services online ODCs used as feedstock. Free tax services online   There is no tax on ODCs sold for use or used as a feedstock. Free tax services online An ODC is used as a feedstock only if the ODC is entirely consumed in the manufacture of another chemical. Free tax services online The transformation of an ODC into one or more new compounds qualifies as use as a feedstock, but use of an ODC in a mixture does not qualify. Free tax services online   For a sale to be nontaxable, you must obtain from the purchaser an exemption certificate that you rely on in good faith. Free tax services online The certificate must be in substantially the form as the sample certificate set forth in Regulations section 52. Free tax services online 4682-2(d)(2). Free tax services online Keep the certificate with your records. Free tax services online Credits or refunds. Free tax services online   A credit or refund (without interest) of tax paid on ODCs may be claimed if a taxed ODC is: Used as a propellant in a metered-dose inhaler (the person who used the ODC as a propellant may file a claim), Exported (the manufacturer may file a claim), or Used as a feedstock (the person who used the ODC may file a claim). Free tax services online For information on how to file for credits or refunds, see the Instructions for Form 720 or Schedule 6 (Form 8849). Free tax services online Conditions to allowance for ODCs exported. Free tax services online   To claim a credit or refund for ODCs that are exported, you must have repaid or agreed to repay the tax to the exporter, or obtained the exporter's written consent to allowance of the credit or refund. Free tax services online You must also have the evidence required by the EPA as proof that the ODCs were exported. Free tax services online Imported Taxable Products An imported product containing or manufactured with ODCs is subject to tax if it is entered into the United States for consumption, use, or warehousing and is listed in the Imported Products Table. Free tax services online The Imported Products Table is listed in Regulations section 52. Free tax services online 4682-3(f)(6). Free tax services online The tax is based on the weight of the ODCs used in the manufacture of the product. Free tax services online Use the following methods to figure the ODC weight. Free tax services online The actual (exact) weight of each ODC used as a material in manufacturing the product. Free tax services online If the actual weight cannot be determined, the ODC weight listed for the product in the Imported Products Table. Free tax services online However, if you cannot determine the actual weight and the table does not list an ODC weight for the product, the rate of tax is 1% of the entry value of the product. Free tax services online Taxable event. Free tax services online   Tax is imposed on an imported taxable product when the product is first sold or used by its importer. Free tax services online The importer is liable for the tax. Free tax services online Use of imported products. Free tax services online   You use an imported product if you put it into service in a trade or business or for the production of income or use it in the making of an article, including incorporation into the article. Free tax services online The loss, destruction, packaging, repackaging, warehousing, or repair of an imported product is not a use of that product. Free tax services online Entry as use. Free tax services online   The importer may choose to treat the entry of a product into the United States as the use of the product. Free tax services online Tax is imposed on the date of entry instead of when the product is sold or used. Free tax services online The choice applies to all imported taxable products that you own and have not used when you make the choice and all later entries. Free tax services online Make the choice by checking the box in Part II of Form 6627. Free tax services online The choice is effective as of the beginning of the calendar quarter to which the Form 6627 applies. Free tax services online You can revoke this choice only with IRS consent. Free tax services online Sale of article incorporating imported product. Free tax services online   The importer may treat the sale of an article manufactured or assembled in the United States as the first sale or use of an imported taxable product incorporated in that article if both the following apply. Free tax services online The importer has consistently treated the sale of similar items as the first sale or use of similar taxable imported products. Free tax services online The importer has not chosen to treat entry into the United States as use of the product. Free tax services online Imported products table. Free tax services online   The table lists all the products that are subject to the tax on imported taxable products and specifies the ODC weight (discussed later) of each product. Free tax services online   Each listing in the table identifies a product by name and includes only products that are described by that name. Free tax services online Most listings identify a product by both name and Harmonized Tariff Schedule (HTS) heading. Free tax services online In those cases, a product is included in that listing only if the product is described by that name and the rate of duty on the product is determined by reference to that HTS heading. Free tax services online A product is included in the listing even if it is manufactured with or contains a different ODC than the one specified in the table. Free tax services online   Part II of the table lists electronic items that are not included within any other list in the table. Free tax services online An imported product is included in this list only if the product meets one of the following tests. Free tax services online It is an electronic component whose operation involves the use of nonmechanical amplification or switching devices such as tubes, transistors, and integrated circuits. Free tax services online It contains components described in (1), which account for more than 15% of the cost of the product. Free tax services online   These components do not include passive electrical devices, such as resistors and capacitors. Free tax services online Items such as screws, nuts, bolts, plastic parts, and similar specially fabricated parts that may be used to construct an electronic item are not themselves included in the listing for electronic items. Free tax services online Rules for listing products. Free tax services online   Products are listed in the table according to the following rules. Free tax services online A product is listed in Part I of the table if it is a mixture containing ODCs. Free tax services online A product is listed in Part II of the table if the Commissioner has determined that the ODCs used as materials in the manufacture of the product under the predominant method are used for purposes of refrigeration or air conditioning, creating an aerosol or foam, or manufacturing electronic components. Free tax services online A product is listed in Part III of the table if the Commissioner has determined that the product meets both the following tests. Free tax services online It is not an imported taxable product. Free tax services online It would otherwise be included within a list in Part II of the table. Free tax services online   For example, floppy disk drive units are listed in Part III because they are not imported taxable products and would have been included in the Part II list for electronic items not specifically identified, but for their listing in Part III. Free tax services online ODC weight. Free tax services online   The Table ODC weight of a product is the weight, determined by the Commissioner, of the ODCs used as materials in the manufacture of the product under the predominant method of manufacturing. Free tax services online The ODC weight is listed in Part II in pounds per single unit of product unless otherwise specified. Free tax services online Modifying the table. Free tax services online   A manufacturer or importer of a product may request the IRS add a product and its ODC weight to the table. Free tax services online They also may request the IRS remove a product from the table, or change or specify the ODC weight of a product. Free tax services online To request a modification, see Regulations section 52. Free tax services online 4682-3(g) for the mailing address and information that must be included in the request. Free tax services online Floor Stocks Tax Tax is imposed on any ODC held (other than by the manufacturer or importer of the ODC) on January 1 for sale or use in further manufacturing. Free tax services online The person holding title (as determined under local law) to the ODC is liable for the tax, whether or not delivery has been made. Free tax services online These chemicals are taxable without regard to the type or size of storage container in which the ODCs are held. Free tax services online The tax may apply to an ODC whether it is in a 14-ounce can or a 30-pound tank. Free tax services online You are liable for the floor stocks tax if you hold any of the following on January 1. Free tax services online At least 400 pounds of ODCs other than halons or methyl chloroform, At least 50 pounds of halons, or At least 1,000 pounds of methyl chloroform. Free tax services online If you are liable for the tax, prepare an inventory on January 1 of the taxable ODCs held on that date for sale or for use in further manufacturing. Free tax services online You must pay this floor stocks tax by June 30 of each year. Free tax services online Report the tax on Form 6627 and Part II of Form 720 for the second calendar quarter. Free tax services online For the tax rates, see the Form 6627 instructions. Free tax services online ODCs not subject to floor stocks tax. Free tax services online   The floor stocks tax is not imposed on any of the following ODCs. Free tax services online ODCs mixed with other ingredients that contribute to achieving the purpose for which the mixture will be used, unless the mixture contains only ODCs and one or more stabilizers. Free tax services online ODCs contained in a manufactured article in which the ODCs will be used for their intended purpose without being released from the article. Free tax services online ODCs that have been reclaimed or recycled. Free tax services online ODCs sold in a qualifying sale for: Use as a feedstock, Export, or Use as a propellant in a metered-dose inhaler. Free tax services online Prev  Up  Next   Home   More Online Publications