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H&r free file Publication 971 - Additional Material Table of Contents How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). H&r free file Questions & AnswersThis section answers questions commonly asked by taxpayers about innocent spouse relief. H&r free file . H&r free file What is joint and several liability? . H&r free file How can I get relief from joint and several liability? . H&r free file What are the rules for innocent spouse relief? . H&r free file What are erroneous items? . H&r free file What is an understated tax? . H&r free file Will I qualify for innocent spouse relief in any situation where there is an understated tax? . H&r free file What are the rules for separation of liability relief? . H&r free file Why would a request for separation of liability relief be denied? . H&r free file What are the rules for equitable relief? . H&r free file How do state community property laws affect my ability to qualify for relief? . H&r free file How do I request relief? . H&r free file When should I file Form 8857? . H&r free file Where should I file Form 8857? . H&r free file I am currently undergoing an examination of my return. H&r free file How do I request innocent spouse relief? . H&r free file What if the IRS has given me notice that it will levy my account for the tax liability and I decide to request relief? . H&r free file What is injured spouse relief? . H&r free file What is joint and several liability? When you file a joint income tax return, the law makes both you and your spouse responsible for the entire tax liability. H&r free file This is called joint and several liability. H&r free file Joint and several liability applies not only to the tax liability you show on the return but also to any additional tax liability the IRS determines to be due, even if the additional tax is due to the income, deductions, or credits of your spouse or former spouse. H&r free file You remain jointly and severally liable for taxes, and the IRS still can collect from you, even if you later divorce and the divorce decree states that your former spouse will be solely responsible for the tax. H&r free file There are three types of relief for filers of joint returns: “innocent spouse relief,” “separation of liability relief,” and “equitable relief. H&r free file ” Each type has different requirements. H&r free file They are explained separately below. H&r free file To qualify for innocent spouse relief, you must meet all of the following conditions. H&r free file You must have filed a joint return which has an understated tax. H&r free file The understated tax must be due to erroneous items of your spouse (or former spouse). H&r free file You must establish that at the time you signed the joint return, you did not know, and had no reason to know, that there was an understated tax. H&r free file Taking into account all of the facts and circumstances, it would be unfair to hold you liable for the understated tax. H&r free file You must request relief within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Erroneous items are any deductions, credits, or bases that are incorrectly stated on the return, and any income that is not properly reported on the return. H&r free file You have an understated tax if the IRS determined that your total tax should be more than the amount actually shown on your return. H&r free file For example, you reported total tax on your 2008 return of $2,500. H&r free file IRS determined in an audit of your 2008 return that the total tax should be $3,000. H&r free file You have a $500 understated tax. H&r free file No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file How can I get relief from joint and several liability? There are three types of relief for filers of joint returns: “innocent spouse relief,” “separation of liability relief,” and “equitable relief. H&r free file ” Each type has different requirements. H&r free file They are explained separately below. H&r free file To qualify for innocent spouse relief, you must meet all of the following conditions. H&r free file You must have filed a joint return which has an understated tax. H&r free file The understated tax must be due to erroneous items of your spouse (or former spouse). H&r free file You must establish that at the time you signed the joint return, you did not know, and had no reason to know, that there was an understated tax. H&r free file Taking into account all of the facts and circumstances, it would be unfair to hold you liable for the understated tax. H&r free file You must request relief within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Erroneous items are any deductions, credits, or bases that are incorrectly stated on the return, and any income that is not properly reported on the return. H&r free file You have an understated tax if the IRS determined that your total tax should be more than the amount actually shown on your return. H&r free file For example, you reported total tax on your 2008 return of $2,500. H&r free file IRS determined in an audit of your 2008 return that the total tax should be $3,000. H&r free file You have a $500 understated tax. H&r free file No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file What are the rules for innocent spouse relief? To qualify for innocent spouse relief, you must meet all of the following conditions. H&r free file You must have filed a joint return which has an understated tax. H&r free file The understated tax must be due to erroneous items of your spouse (or former spouse). H&r free file You must establish that at the time you signed the joint return, you did not know, and had no reason to know, that there was an understated tax. H&r free file Taking into account all of the facts and circumstances, it would be unfair to hold you liable for the understated tax. H&r free file You must request relief within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Erroneous items are any deductions, credits, or bases that are incorrectly stated on the return, and any income that is not properly reported on the return. H&r free file You have an understated tax if the IRS determined that your total tax should be more than the amount actually shown on your return. H&r free file For example, you reported total tax on your 2008 return of $2,500. H&r free file IRS determined in an audit of your 2008 return that the total tax should be $3,000. H&r free file You have a $500 understated tax. H&r free file No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file What are “erroneous items”? Erroneous items are any deductions, credits, or bases that are incorrectly stated on the return, and any income that is not properly reported on the return. H&r free file You have an understated tax if the IRS determined that your total tax should be more than the amount actually shown on your return. H&r free file For example, you reported total tax on your 2008 return of $2,500. H&r free file IRS determined in an audit of your 2008 return that the total tax should be $3,000. H&r free file You have a $500 understated tax. H&r free file No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file What is an “understated tax”? You have an understated tax if the IRS determined that your total tax should be more than the amount actually shown on your return. H&r free file For example, you reported total tax on your 2008 return of $2,500. H&r free file IRS determined in an audit of your 2008 return that the total tax should be $3,000. H&r free file You have a $500 understated tax. H&r free file No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file Will I qualify for innocent spouse relief in any situation where there is an understated tax? No. H&r free file There are many situations in which you may owe tax that is related to your spouse (or former spouse), but not be eligible for innocent spouse relief. H&r free file For example, you and your spouse file a joint return on which you report $10,000 of income and deductions, but you knew that your spouse was not reporting $5,000 of dividends. H&r free file You are not eligible for innocent spouse relief because you have knowledge of the understated tax. H&r free file Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file What are the rules for separation of liability relief? Under this type of relief, you allocate (separate) the understated tax (plus interest and penalties) on your joint return between you and your spouse (or former spouse). H&r free file The understated tax allocated to you is generally the amount you are responsible for. H&r free file To qualify for separation of liability relief, you must have filed a joint return and meet either of the following requirements at the time you file Form 8857. H&r free file You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. H&r free file (Under this rule, you are no longer married if you are widowed. H&r free file ) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12-month period ending on the date you file Form 8857. H&r free file In addition to the above requirements, you must file a Form 8857 within 2 years after the date on which the IRS first began collection activity against you after July 22, 1998. H&r free file Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file Why would a request for separation of liability relief be denied? Even if you meet the requirements listed earlier, a request for separation of liability relief will not be granted in the following situations. H&r free file The IRS proves that you and your spouse (or former spouse) transferred assets to one another as part of a fraudulent scheme. H&r free file The IRS proves that at the time you signed your joint return, you had actual knowledge of any erroneous items giving rise to the deficiency that are allocable to your spouse (or former spouse). H&r free file Your spouse (or former spouse) transferred property to you to avoid tax or the payment of tax. H&r free file Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file What are the rules for equitable relief? Equitable relief is only available if you meet all of the following conditions. H&r free file You do not qualify for innocent spouse relief, separation of liability relief, or relief from liability arising from community property law. H&r free file You have an understated tax or underpaid tax. H&r free file See Note later. H&r free file You did not pay the tax. H&r free file However, see Refunds , earlier, for exceptions. H&r free file The IRS determines that it is unfair to hold you liable for the understated or underpaid tax taking into account all the facts and circumstances. H&r free file You and your spouse (or former spouse) did not transfer assets to one another as a part of a fraudulent scheme. H&r free file Your spouse (or former spouse) did not transfer property to you for the main purpose of avoiding tax or the payment of tax. H&r free file You did not file or fail to file your return with the intent to commit fraud. H&r free file The income tax liability for which you seek relief is attributable to your spouse (or former spouse) with whom you filed the joint return. H&r free file For exceptions to this condition, see item (8) under Conditions for Getting Equitable Relief , earlier. H&r free file You timely file Form 8857 as explained earlier in Exception for equitable relief under How To Request Relief. H&r free file Note. H&r free file Unlike innocent spouse relief or separation of liability relief, if you qualify for equitable relief, you can also get relief from an underpaid tax. H&r free file (An underpaid tax is tax that is properly shown on the return, but has not been paid. H&r free file ) Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or resume collecting from you. H&r free file The 10-year period will be increased by the amount of time your request for relief was pending plus 60 days. H&r free file See Publication 594 for more information. H&r free file Injured spouse relief is different from innocent spouse relief. H&r free file When a joint return is filed and the refund is used to pay one spouse's past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or federal non-tax debt, such as a student loan, the other spouse may be considered an injured spouse. H&r free file The injured spouse can get back his or her share of the joint overpayment using Form 8379, Injured Spouse Allocation. H&r free file You are considered an injured spouse if: You are not legally obligated to pay the past-due amount, and You meet any of the following conditions: You made and reported tax payments (such as federal income tax withholding or estimated tax payments). H&r free file You had earned income (such as wages, salaries, or self-employment income) and claimed the earned income credit or the additional child tax credit. H&r free file You claimed a refundable tax credit, such as the health coverage tax credit or the refundable credit for prior year minimum tax. H&r free file Note. H&r free file If your residence was in a community property state at any time during the year, you may file Form 8379 even if only item (1) above applies. H&r free file . H&r free file How do state community property laws affect my ability to qualify for relief? Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. H&r free file Generally, community property laws require you to allocate community income and expenses equally between both spouses. H&r free file However, community property laws are not taken into account in determining whether an item belongs to you or to your spouse (or former spouse) for purposes of requesting any relief from liability. H&r free file      File Form 8857, Request for Innocent Spouse Relief, to ask the IRS for relief. H&r free file You must file an additional Form 8857 if you are requesting relief for more than three years. H&r free file If you are requesting innocent spouse relief or separation of liability relief, file Form 8857 no later than two years after the date on which the IRS first began collection activities against you after July 22, 1998. H&r free file If you are requesting equitable relief, see Exception for equitable relief. H&r free file under How To Request Relief, earlier, for when to file Form 8857. H&r free file If you are requesting relief from liability arising from community property law, see How and When To Request Relief under Community Property Laws, earlier, for when to file Form 8857. H&r free file Use the address or fax number shown in the Instructions for Form 8857. H&r free file File Form 8857 at the address or send it to the fax number shown in the Instructions for Form 8857. H&r free file Do not file it with the employee assigned to examine your return. H&r free file Generally, the IRS has 10 years to collect an amount you owe. H&r free file This is the collection statute of limitations. H&r free file By law, the IRS is not allowed to collect from you after the 10-year period ends. H&r free file If you request relief for any tax year, the IRS cannot collect from you for that year while your request is pending. H&r free file But interest and penalties continue to accrue. H&r free file Your request is generally considered pending from the date the IRS receives your Form 8857 until the date your request is resolved. H&r free file This includes the time the Tax Court is considering your request. H&r free file After your case is resolved, the IRS can begin or
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Brandon, MS

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The H&r Free File

H&r free file 1. H&r free file   Fuel Taxes Table of Contents Definitions Information Returns Registration RequirementsAdditional information. H&r free file Gasoline and Aviation GasolineTaxable Events Gasoline Blendstocks Diesel Fuel and KeroseneTaxable Events Dyed Diesel Fuel and Dyed Kerosene Alaska and Feedstocks Back-up Tax Diesel-Water Fuel Emulsion Kerosene for Use in AviationTaxable Events Liability For Tax Surtax on any liquid used in a fractional ownership program aircraft as fuel Certificate for Commercial Aviation and Exempt UsesExempt use. H&r free file Reseller statement. H&r free file Other Fuels (Including Alternative Fuels)Taxable Events Compressed Natural Gas (CNG)Taxable Events Fuels Used on Inland WaterwaysFishing vessels. H&r free file Deep-draft ocean-going vessels. H&r free file Passenger vessels. H&r free file Ocean-going barges. H&r free file State or local governments. H&r free file Cellulosic or Second Generation Biofuel Not Used as Fuel Biodiesel Sold as But Not Used as Fuel Definitions Excise taxes are imposed on all the following fuels. H&r free file Gasoline, including aviation gasoline and gasoline blendstocks. H&r free file Diesel fuel, including dyed diesel fuel. H&r free file Diesel-water fuel emulsion. H&r free file Kerosene, including dyed kerosene and kerosene used in aviation. H&r free file Other Fuels (including alternative fuels). H&r free file Compressed natural gas (CNG). H&r free file Fuels used in commercial transportation on inland waterways. H&r free file Any liquid used in a fractional ownership program aircraft as fuel. H&r free file The following terms are used throughout the discussion of fuel taxes. H&r free file Other terms are defined in the discussion of the specific fuels to which they pertain. H&r free file Agri-biodiesel. H&r free file   Agri-biodiesel means biodiesel derived solely from virgin oils, including esters derived from virgin vegetable oils from corn, soybeans, sunflower seeds, cottonseeds, canola, crambe, rapeseeds, safflowers, flaxseeds, rice bran, mustard seeds, and camelina, and from animal fats. H&r free file Approved terminal or refinery. H&r free file   This is a terminal operated by a registrant that is a terminal operator or a refinery operated by a registrant that is a refiner. H&r free file Biodiesel. H&r free file   Biodiesel means the monoalkyl esters of long chain fatty acids derived from plant or animal matter that meet the registration requirements for fuels and fuel additives established by the Environmental Protection Agency (EPA) under section 211 of the Clean Air Act, and the requirements of the American Society of Testing Materials (ASTM) D6751. H&r free file Blended taxable fuel. H&r free file   This means any taxable fuel produced outside the bulk transfer/terminal system by mixing taxable fuel on which excise tax has been imposed and any other liquid on which excise tax has not been imposed. H&r free file This does not include a mixture removed or sold during the calendar quarter if all such mixtures removed or sold by the blender contain less than 400 gallons of a liquid on which the tax has not been imposed. H&r free file Blender. H&r free file   This is the person that produces blended taxable fuel. H&r free file Bulk transfer. H&r free file   This is the transfer of taxable fuel by pipeline or vessel. H&r free file Bulk transfer/terminal system. H&r free file   This is the taxable fuel distribution system consisting of refineries, pipelines, vessels, and terminals. H&r free file Fuel in the supply tank of any engine, or in any tank car, railcar, trailer, truck, or other equipment suitable for ground transportation is not in the bulk transfer/terminal system. H&r free file Cellulosic biofuel. H&r free file   Cellulosic biofuel means any liquid fuel produced from any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis that meets the registration requirements for fuels and fuel additives established by the EPA under section 211 of the Clean Air Act. H&r free file Cellulosic biofuel does not include any alcohol with a proof of less than 150 (without regard to denaturants). H&r free file For fuels sold or used after December 31, 2009, cellulosic biofuel does not include fuel of which more than 4% (determined by weight) is any combination of water and sediment, fuel of which the ash content is more than 1%, or fuel that has an acid number greater than 25. H&r free file Also see Second generation biofuel below. H&r free file Diesel-water fuel emulsion. H&r free file   A diesel-water fuel emulsion means an emulsion at least 14% of which is water. H&r free file The emulsion additive used to produce the fuel must be registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003. H&r free file Dry lease aircraft exchange. H&r free file   See later, under Surtax on any liquid used in a fractional ownership program aircraft as fuel. H&r free file Enterer. H&r free file   This is the importer of record (under customs law) for the taxable fuel. H&r free file However, if the importer of record is acting as an agent, such as a customs broker, the person for whom the agent is acting is the enterer. H&r free file If there is no importer of record, the owner at the time of entry into the United States is the enterer. H&r free file Entry. H&r free file   Taxable fuel is entered into the United States when it is brought into the United States and applicable customs law requires that it be entered for consumption, use, or warehousing. H&r free file This does not apply to fuel brought into Puerto Rico (which is part of the U. H&r free file S. H&r free file customs territory), but does apply to fuel brought into the United States from Puerto Rico. H&r free file Fractional ownership aircraft program and fractional program aircraft. H&r free file   See later, under Surtax on any liquid used in a fractional ownership program aircraft as fuel. H&r free file Measurement of taxable fuel. H&r free file   Volumes of taxable fuel can be measured on the basis of actual volumetric gallons or gallons adjusted to 60 degrees Fahrenheit. H&r free file Other fuels. H&r free file   See Other Fuels (Including Alternative Fuels), later, and Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2. H&r free file Pipeline operator. H&r free file   This is the person that operates a pipeline within the bulk transfer/terminal system. H&r free file Position holder. H&r free file   This is the person that holds the inventory position in the taxable fuel in the terminal, as reflected in the records of the terminal operator. H&r free file You hold the inventory position when you have a contractual agreement with the terminal operator for the use of the storage facilities and terminaling services for the taxable fuel. H&r free file A terminal operator that owns taxable fuel in its terminal is a position holder. H&r free file Rack. H&r free file   This is a mechanism capable of delivering fuel into a means of transport other than a pipeline or vessel. H&r free file Refiner. H&r free file   This is any person that owns, operates, or otherwise controls a refinery. H&r free file Refinery. H&r free file   This is a facility used to produce taxable fuel and from which taxable fuel may be removed by pipeline, by vessel, or at a rack. H&r free file However, this term does not include a facility where only blended fuel, and no other type of fuel, is produced. H&r free file For this purpose, blended fuel is any mixture that would be blended taxable fuel if produced outside the bulk transfer/terminal system. H&r free file Registrant. H&r free file   This is a taxable fuel registrant (see Registration Requirements, later). H&r free file Removal. H&r free file   This is any physical transfer of taxable fuel. H&r free file It also means any use of taxable fuel other than as a material in the production of taxable fuel or Other Fuels. H&r free file However, taxable fuel is not removed when it evaporates or is otherwise lost or destroyed. H&r free file Renewable diesel. H&r free file   See Renewable Diesel Credits in chapter 2. H&r free file Sale. H&r free file   For taxable fuel not in a terminal, this is the transfer of title to, or substantial incidents of ownership in, taxable fuel to the buyer for money, services, or other property. H&r free file For taxable fuel in a terminal, this is the transfer of the inventory position if the transferee becomes the position holder for that taxable fuel. H&r free file Second generation biofuel. H&r free file   This is any liquid fuel derived by, or from, qualified feedstocks, and meets the registration requirements for fuels and fuel additives established by the Environmental Protection Agency under section 211 of the Clean Air Act (42 U. H&r free file S. H&r free file C. H&r free file 7545). H&r free file It also includes certain liquid fuel which is derived by, or from, any cultivated algae, cyanobacteria, or lemna. H&r free file It is not alcohol of less than 150 proof (disregard any added denaturants). H&r free file See Form 6478 for more information. H&r free file State. H&r free file   This includes any state, any of its political subdivisions, the District of Columbia, and the American Red Cross. H&r free file An Indian tribal government is treated as a state only if transactions involve the exercise of an essential tribal government function. H&r free file Taxable fuel. H&r free file   This means gasoline, diesel fuel, and kerosene. H&r free file Terminal. H&r free file   This is a storage and distribution facility supplied by pipeline or vessel, and from which taxable fuel may be removed at a rack. H&r free file It does not include a facility at which gasoline blendstocks are used in the manufacture of products other than finished gasoline if no gasoline is removed from the facility. H&r free file A terminal does not include any facility where finished gasoline, diesel fuel, or kerosene is stored if the facility is operated by a registrant and all such taxable fuel stored at the facility has been previously taxed upon removal from a refinery or terminal. H&r free file Terminal operator. H&r free file   This is any person that owns, operates, or otherwise controls a terminal. H&r free file Throughputter. H&r free file   This is any person that is a position holder or that owns taxable fuel within the bulk transfer/terminal system (other than in a terminal). H&r free file Vessel operator. H&r free file   This is the person that operates a vessel within the bulk transfer/terminal system. H&r free file However, vessel does not include a deep draft ocean-going vessel. H&r free file Information Returns Form 720-TO and Form 720-CS are information returns used to report monthly receipts and disbursements of liquid products. H&r free file A liquid product is any liquid transported into storage at a terminal or delivered out of a terminal. H&r free file For a list of products, see the product code table in the Instructions for Forms 720-TO and 720-CS. H&r free file The returns are due the last day of the month following the month in which the transaction occurs. H&r free file Generally, these returns can be filed on paper or electronically. H&r free file For information on filing electronically, see Publication 3536, Motor Fuel Excise Tax EDI Guide. H&r free file Publication 3536 is only available on the IRS website. H&r free file Form 720-TO. H&r free file   This information return is used by terminal operators to report receipts and disbursements of all liquid products to and from all approved terminals. H&r free file Each terminal operator must file a separate form for each approved terminal. H&r free file Form 720-CS. H&r free file   This information return must be filed by bulk transport carriers (barges, vessels, and pipelines) who receive liquid product from an approved terminal or deliver liquid product to an approved terminal. H&r free file Registration Requirements The following discussion applies to excise tax registration requirements for activities relating to fuels only. H&r free file See Form 637 for other persons who must register and for more information about registration. H&r free file Persons that are required to be registered. H&r free file   You are required to be registered if you are a: Blender; Enterer; Pipeline operator; Position holder; Refiner; Terminal operator; Vessel operator; Producer or importer of alcohol, biodiesel, agri-biodiesel, and renewable diesel; or Producer of cellulosic or second generation biofuel. H&r free file Persons that may register. H&r free file   You may, but are not required to, register if you are a: Feedstock user, Industrial user, Throughputter that is not a position holder, Ultimate vendor, Diesel-water fuel emulsion producer, Credit card issuer, or Alternative fuel claimant. H&r free file Ultimate vendors, credit card issuers, and alternative fuel claimants do not need to be registered to buy or sell fuel. H&r free file However, they must be registered to file claims for certain sales and uses of fuel. H&r free file See Form 637 for more information. H&r free file Taxable fuel registrant. H&r free file   This is an enterer, an industrial user, a refiner, a terminal operator, or a throughputter who received a Letter of Registration under the excise tax registration provisions and whose registration has not been revoked or suspended. H&r free file The term registrant as used in the discussions of these fuels means a taxable fuel registrant. H&r free file Additional information. H&r free file   See the Form 637 instructions for the information you must submit when you apply for registration. H&r free file Failure to register. H&r free file   The penalty for failure to register if you must register, unless due to reasonable cause, is $10,000 for the initial failure, and then $1,000 each day thereafter you fail to register. H&r free file Gasoline and Aviation Gasoline Gasoline. H&r free file   Gasoline means all products commonly or commercially known or sold as gasoline with an octane rating of 75 or more that are suitable for use as a motor fuel. H&r free file Gasoline includes any gasoline blend other than: Qualified ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from coal, including peat), Partially exempt ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from natural gas), or Denatured alcohol. H&r free file Gasoline also includes gasoline blendstocks, discussed later. H&r free file Aviation gasoline. H&r free file   This means all special grades of gasoline suitable for use in aviation reciprocating engines and covered by ASTM specification D910 or military specification MIL-G-5572. H&r free file Taxable Events The tax on gasoline is $. H&r free file 184 per gallon. H&r free file The tax on aviation gasoline is $. H&r free file 194 per gallon. H&r free file When used in a fractional ownership program aircraft, gasoline also is subject to a surtax of $. H&r free file 141 per gallon. H&r free file See Surtax on any liquid used in a fractional ownership program aircraft as fuel, later. H&r free file Tax is imposed on the removal, entry, or sale of gasoline. H&r free file Each of these events is discussed later. H&r free file Also, see the special rules that apply to gasoline blendstocks, later. H&r free file If the tax is paid on the gasoline in more than one event, a refund may be allowed for the “second” tax paid. H&r free file See Refunds of Second Tax in chapter 2. H&r free file Removal from terminal. H&r free file   All removals of gasoline at a terminal rack are taxable. H&r free file The position holder for that gasoline is liable for the tax. H&r free file Two-party exchanges. H&r free file   In a two-party exchange, the receiving person, not the delivering person, is liable for the tax imposed on the removal of taxable fuel from the terminal at the terminal rack. H&r free file A two-party exchange means a transaction (other than a sale) where the delivering person and receiving person are both taxable fuel registrants and all of the following apply. H&r free file The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator. H&r free file The exchange transaction occurs before or at the same time as removal across the rack by the receiving person. H&r free file The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO. H&r free file The transaction is subject to a written contract. H&r free file Terminal operator's liability. H&r free file   The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator and is not a registrant. H&r free file   However, a terminal operator meeting all the following conditions at the time of the removal will not be liable for the tax. H&r free file The terminal operator is a registrant. H&r free file The terminal operator has an unexpired notification certificate (discussed later) from the position holder. H&r free file The terminal operator has no reason to believe any information on the certificate is false. H&r free file Removal from refinery. H&r free file   The removal of gasoline from a refinery is taxable if the removal meets either of the following conditions. H&r free file It is made by bulk transfer and the refiner, the owner of the gasoline immediately before the removal, or the operator of the pipeline or vessel is not a registrant. H&r free file It is made at the refinery rack. H&r free file The refiner is liable for the tax. H&r free file Exception. H&r free file   The tax does not apply to a removal of gasoline at the refinery rack if all the following requirements are met. H&r free file The gasoline is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel. H&r free file The gasoline is received at a facility operated by a registrant and located within the bulk transfer/terminal system. H&r free file The removal from the refinery is by railcar. H&r free file The same person operates the refinery and the facility at which the gasoline is received. H&r free file Entry into the United States. H&r free file   The entry of gasoline into the United States is taxable if the entry meets either of the following conditions. H&r free file It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant. H&r free file It is not made by bulk transfer. H&r free file The enterer is liable for the tax. H&r free file Importer of record's liability. H&r free file   The importer of record is jointly and severally liable for the tax with the enterer if the importer of record is not the enterer of the taxable fuel and the enterer is not a taxable fuel registrant. H&r free file   However, an importer of record meeting both of the following conditions at the time of the entry will not be liable for the tax. H&r free file The importer of record has an unexpired notification certificate (discussed later) from the enterer. H&r free file The importer of record has no reason to believe any information in the certificate is false. H&r free file Customs bond. H&r free file   The customs bond will not be charged for the tax imposed on the entry of the gasoline if at the time of entry the surety has an unexpired notification certificate from the enterer and has no reason to believe any information in the certificate is false. H&r free file Removal from a terminal by unregistered position holder or unregistered pipeline or vessel operator. H&r free file   The removal by bulk transfer of gasoline from a terminal is taxable if the position holder for the gasoline or the operator of the pipeline or vessel is not a registrant. H&r free file The position holder is liable for the tax. H&r free file The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator. H&r free file However, see Terminal operator's liability under Removal from terminal, earlier, for an exception. H&r free file Bulk transfers not received at approved terminal or refinery. H&r free file   The removal by bulk transfer of gasoline from a terminal or refinery, or the entry of gasoline by bulk transfer into the United States, is taxable if the following conditions apply. H&r free file No tax was previously imposed (as discussed earlier) on any of the following events. H&r free file The removal from the refinery. H&r free file The entry into the United States. H&r free file The removal from a terminal by an unregistered position holder. H&r free file Upon removal from the pipeline or vessel, the gasoline is not received at an approved terminal or refinery (or at another pipeline or vessel). H&r free file   The owner of the gasoline when it is removed from the pipeline or vessel is liable for the tax. H&r free file However, an owner meeting all the following conditions at the time of the removal will not be liable for the tax. H&r free file The owner is a registrant. H&r free file The owner has an unexpired notification certificate (discussed later) from the operator of the terminal or refinery where the gasoline is received. H&r free file The owner has no reason to believe any information on the certificate is false. H&r free file The operator of the facility where the gasoline is received is liable for the tax if the owner meets these conditions. H&r free file The operator is jointly and severally liable if the owner does not meet these conditions. H&r free file Sales to unregistered person. H&r free file   The sale of gasoline located within the bulk transfer/terminal system to a person that is not a registrant is taxable if tax was not previously imposed under any of the events discussed earlier. H&r free file   The seller is liable for the tax. H&r free file However, a seller meeting all the following conditions at the time of the sale will not be liable for the tax. H&r free file   The seller is a registrant. H&r free file The seller has an unexpired notification certificate (discussed later) from the buyer. H&r free file The seller has no reason to believe any information on the certificate is false. H&r free file The buyer of the gasoline is liable for the tax if the seller meets these conditions. H&r free file The buyer is jointly and severally liable if the seller does not meet these conditions. H&r free file Exception. H&r free file   The tax does not apply to a sale if all of the following apply. H&r free file The buyer's principal place of business is not in the United States. H&r free file The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel. H&r free file The seller is a registrant and the exporter of record. H&r free file The fuel was exported. H&r free file Removal or sale of blended gasoline. H&r free file   The removal or sale of blended gasoline by the blender is taxable. H&r free file See Blended taxable fuel under Definitions, earlier. H&r free file   The blender is liable for the tax. H&r free file The tax is figured on the number of gallons not previously subject to the tax on gasoline. H&r free file   Persons who blend alcohol with gasoline to produce an alcohol fuel mixture outside the bulk transfer/terminal system must pay the gasoline tax on the volume of alcohol in the mixture. H&r free file See Form 720 to report this tax. H&r free file You also must be registered with the IRS as a blender. H&r free file See Form 637. H&r free file   However, if an untaxed liquid is sold as taxed taxable fuel and that untaxed liquid is used to produce blended taxable fuel, the person that sold the untaxed liquid is jointly and severally liable for the tax imposed on the blender's sale or removal of the blended taxable fuel. H&r free file Notification certificate. H&r free file   The notification certificate is used to notify a person of the registration status of the registrant. H&r free file A copy of the registrant's letter of registration cannot be used as a notification certificate. H&r free file A model notification certificate is shown in the Appendix as Model Certificate C. H&r free file A notification certificate must contain all information necessary to complete the model. H&r free file   The certificate may be included as part of any business records normally used for a sale. H&r free file A certificate expires on the earlier of the date the registrant provides a new certificate, or the date the recipient of the certificate is notified that the registrant's registration has been revoked or suspended. H&r free file The registrant must provide a new certificate if any information on a certificate has changed. H&r free file Additional persons liable. H&r free file   When the person liable for the tax willfully fails to pay the tax, joint and several liability for the tax is imposed on: Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty, or Anyone who willfully causes the person to fail to pay the tax. H&r free file Gasoline Blendstocks Gasoline blendstocks may be subject to $. H&r free file 001 per gallon LUST tax as discussed below. H&r free file Gasoline includes gasoline blendstocks. H&r free file The previous discussions apply to these blendstocks. H&r free file However, if certain conditions are met, the removal, entry, or sale of gasoline blendstocks are taxed at $. H&r free file 001 per gallon or are not subject to the excise tax. H&r free file Blendstocks. H&r free file   Gasoline blendstocks are: Alkylate, Butane, Butene, Catalytically cracked gasoline, Coker gasoline, Ethyl tertiary butyl ether (ETBE), Hexane, Hydrocrackate, Isomerate, Methyl tertiary butyl ether (MTBE), Mixed xylene (not including any separated isomer of xylene), Natural gasoline, Pentane, Pentane mixture, Polymer gasoline, Raffinate, Reformate, Straight-run gasoline, Straight-run naphtha, Tertiary amyl methyl ether (TAME), Tertiary butyl alcohol (gasoline grade) (TBA), Thermally cracked gasoline, and Toluene. H&r free file   However, gasoline blendstocks do not include any product that cannot be used without further processing in the production of finished gasoline. H&r free file Not used to produce finished gasoline. H&r free file   Gasoline blendstocks not used to produce finished gasoline are not taxable (other than LUST) if the following conditions are met. H&r free file Removals and entries not connected to sale. H&r free file   Nonbulk removals and entries are not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) is a registrant. H&r free file Removals and entries connected to sale. H&r free file   Nonbulk removals and entries are not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) is a registrant, and at the time of the sale, meets the following requirements. H&r free file The person has an unexpired certificate (discussed later) from the buyer. H&r free file The person has no reason to believe any information in the certificate is false. H&r free file Sales after removal or entry. H&r free file   The sale of a gasoline blendstock that was not subject to tax on its nonbulk removal or entry, as discussed earlier, is taxable. H&r free file The seller is liable for the tax. H&r free file However, the sale is not taxable if, at the time of the sale, the seller meets the following requirements. H&r free file The seller has an unexpired certificate (discussed next) from the buyer. H&r free file The seller has no reason to believe any information in the certificate is false. H&r free file Certificate of buyer. H&r free file   The certificate from the buyer certifies the gasoline blendstocks will not be used to produce finished gasoline. H&r free file The certificate may be included as part of any business records normally used for a sale. H&r free file A model certificate is shown in the Appendix as Model Certificate D. H&r free file The certificate must contain all information necessary to complete the model. H&r free file   A certificate expires on the earliest of the following dates. H&r free file The date 1 year after the effective date (not earlier than the date signed) of the certificate. H&r free file The date a new certificate is provided to the seller. H&r free file The date the seller is notified that the buyer's right to provide a certificate has been withdrawn. H&r free file The buyer must provide a new certificate if any information on a certificate has changed. H&r free file   The IRS may withdraw the buyer's right to provide a certificate if that buyer uses the gasoline blendstocks in the production of finished gasoline or resells the blendstocks without getting a certificate from its buyer. H&r free file Received at approved terminal or refinery. H&r free file   The nonbulk removal or entry of gasoline blendstocks received at an approved terminal or refinery is not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) meets all the following requirements. H&r free file The person is a registrant. H&r free file The person has an unexpired notification certificate (discussed earlier) from the operator of the terminal or refinery where the gasoline blendstocks are received. H&r free file The person has no reason to believe any information on the certificate is false. H&r free file Bulk transfers to registered industrial user. H&r free file   The removal of gasoline blendstocks from a pipeline or vessel is not taxable (other than LUST) if the blendstocks are received by a registrant that is an industrial user. H&r free file An industrial user is any person that receives gasoline blendstocks by bulk transfer for its own use in the manufacture of any product other than finished gasoline. H&r free file Credits or Refunds. H&r free file   A credit or refund of the gasoline tax may be allowable if gasoline is used for a nontaxable purpose or exempt use. H&r free file For more information, see chapter 2. H&r free file Diesel Fuel and Kerosene Generally, diesel fuel and kerosene are taxed in the same manner as gasoline (discussed earlier). H&r free file However, special rules (discussed later) apply to dyed diesel fuel and dyed kerosene, and to undyed diesel fuel and undyed kerosene sold or used in Alaska for certain nontaxable uses and undyed kerosene used for a feedstock purpose. H&r free file Diesel fuel means: Any liquid that without further processing or blending is suitable for use as a fuel in a diesel-powered highway vehicle or train, and Transmix. H&r free file A liquid is suitable for this use if the liquid has practical and commercial fitness for use in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. H&r free file A liquid may possess this practical and commercial fitness even though the specified use is not the predominant use of the liquid. H&r free file However, a liquid does not possess this practical and commercial fitness solely by reason of its possible or rare use as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. H&r free file Diesel fuel does not include gasoline, kerosene, excluded liquid, No. H&r free file 5 and No. H&r free file 6 fuel oils covered by ASTM specification D396, or F-76 (Fuel Naval Distillate) covered by military specification MIL-F-16884. H&r free file An excluded liquid is either of the following. H&r free file A liquid that contains less than 4% normal paraffins. H&r free file A liquid with all the following properties. H&r free file Distillation range of 125 degrees Fahrenheit or less. H&r free file Sulfur content of 10 ppm or less. H&r free file Minimum color of +27 Saybolt. H&r free file Transmix means a by-product of refined products created by the mixing of different specification products during pipeline transportation. H&r free file Kerosene. H&r free file   This means any of the following liquids. H&r free file One of the two grades of kerosene (No. H&r free file 1-K and No. H&r free file 2-K) covered by ASTM specification D3699. H&r free file Kerosene-type jet fuel covered by ASTM specification D1655 or military specification MIL-DTL-5624T (Grade JP-5) or MIL-DTL-83133E (Grade JP-8). H&r free file See Kerosene for Use in Aviation, later. H&r free file   However, kerosene does not include excluded liquid, discussed earlier. H&r free file   Kerosene also includes any liquid that would be described above but for the presence of a dye of the type used to dye kerosene for a nontaxable use. H&r free file Diesel-powered highway vehicle. H&r free file   This is any self-propelled vehicle designed to carry a load over public highways (whether or not also designed to perform other functions) and propelled by a diesel-powered engine. H&r free file Specially designed mobile machinery for nontransportation functions and vehicles specially designed for off-highway transportation are generally not considered diesel-powered highway vehicles. H&r free file For more information about these vehicles and for information about vehicles not considered highway vehicles, see Off-Highway Business Use (No. H&r free file 2) in chapter 2. H&r free file Diesel-powered train. H&r free file   This is any diesel-powered equipment or machinery that rides on rails. H&r free file The term includes a locomotive, work train, switching engine, and track maintenance machine. H&r free file Taxable Events The tax on diesel fuel and kerosene is $. H&r free file 244 per gallon. H&r free file It is imposed on the removal, entry, or sale of diesel fuel and kerosene. H&r free file Each of these events is discussed later. H&r free file Only the $. H&r free file 001 LUST tax applies to dyed diesel fuel and dyed kerosene, discussed later. H&r free file If the tax is paid on the diesel fuel or kerosene in more than one event, a refund may be allowed for the “second” tax paid. H&r free file See Refunds of Second Tax in chapter 2. H&r free file Use in certain intercity and local buses. H&r free file   Dyed diesel fuel and dyed kerosene cannot be used in certain intercity and local buses. H&r free file A claim for $. H&r free file 17 per gallon may be made by the registered ultimate vendor (under certain conditions) or the ultimate purchaser for undyed diesel fuel or undyed kerosene sold for use in certain intercity or local buses. H&r free file An intercity or local bus is a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. H&r free file The bus must be engaged in one of the following activities. H&r free file Scheduled transportation along regular routes regardless of the size of the bus. H&r free file Nonscheduled transportation if the seating capacity of the bus is at least 20 adults (not including the driver). H&r free file A bus is available to the general public if the bus is available for hire to more than a limited number of persons, groups, or organizations. H&r free file Removal from terminal. H&r free file   All removals of diesel fuel and kerosene at a terminal rack are taxable. H&r free file The position holder for that fuel is liable for the tax. H&r free file Two-party exchanges. H&r free file   In a two-party exchange, the receiving person, not the delivering person, is liable for the tax imposed on the removal of taxable fuel from the terminal at the terminal rack. H&r free file A two-party exchange means a transaction (other than a sale) where the delivering person and receiving person are both taxable fuel registrants and all of the following apply. H&r free file The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator. H&r free file The exchange transaction occurs before or at the same time as completion of removal across the rack by the receiving person. H&r free file The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO. H&r free file The transaction is subject to a written contract. H&r free file Terminal operator's liability. H&r free file   The terminal operator is jointly and severally liable for the tax if the terminal operator provides any person with any bill of lading, shipping paper, or similar document indicating that diesel fuel or kerosene is dyed (discussed later). H&r free file   The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator and is not a registrant. H&r free file However, a terminal operator will not be liable for the tax in this situation if, at the time of the removal, the following conditions are met. H&r free file The terminal operator is a registrant. H&r free file The terminal operator has an unexpired notification certificate (discussed under Gasoline) from the position holder. H&r free file The terminal operator has no reason to believe any information on the certificate is false. H&r free file Removal from refinery. H&r free file   The removal of diesel fuel or kerosene from a refinery is taxable if the removal meets either of the following conditions. H&r free file It is made by bulk transfer and the refiner, the owner of the fuel immediately before the removal, or the operator of the pipeline or vessel is not a registrant. H&r free file It is made at the refinery rack. H&r free file The refiner is liable for the tax. H&r free file Exception. H&r free file   The tax does not apply to a removal of diesel fuel or kerosene at the refinery rack if all the following conditions are met. H&r free file The diesel fuel or kerosene is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel. H&r free file The diesel fuel or kerosene is received at a facility operated by a registrant and located within the bulk transfer/terminal system. H&r free file The removal from the refinery is by: Railcar and the same person operates the refinery and the facility at which the diesel fuel or kerosene is received, or For diesel fuel only, a trailer or semi-trailer used exclusively to transport the diesel fuel from a refinery (described in (1)) to a facility (described in (2)) less than 20 miles from the refinery. H&r free file Entry into the United States. H&r free file   The entry of diesel fuel or kerosene into the United States is taxable if the entry meets either of the following conditions. H&r free file It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant. H&r free file It is not made by bulk transfer. H&r free file The enterer is liable for the tax. H&r free file Importer of record's liability. H&r free file   The importer of record is jointly and severally liable for the tax with the enterer if the importer of record is not the enterer of the taxable fuel and the enterer is not a taxable fuel registrant. H&r free file   However, an importer of record meeting both of the following conditions at the time of the entry will not be liable for the tax. H&r free file The importer of record has an unexpired notification certificate (discussed under Gasoline) from the enterer. H&r free file The importer of record has no reason to believe any information in the certificate is false. H&r free file Customs bond. H&r free file   The customs bond will not be charged for the tax imposed on the entry of the diesel fuel or kerosene if at the time of entry the surety has an unexpired notification certificate from the enterer and has no reason to believe any information in the certificate is false. H&r free file Removal from a terminal by unregistered position holder or unregistered pipeline or vessel operator. H&r free file   The removal by bulk transfer of diesel fuel or kerosene from a terminal is taxable if the position holder for that fuel or the operator of the pipeline or vessel is not a registrant. H&r free file The position holder is liable for the tax. H&r free file The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator. H&r free file However, see Terminal operator's liability under Removal from terminal, earlier, for an exception. H&r free file Bulk transfers not received at approved terminal or refinery. H&r free file   The removal by bulk transfer of diesel fuel or kerosene from a terminal or refinery or the entry of diesel fuel or kerosene by bulk transfer into the United States is taxable if the following conditions apply. H&r free file No tax was previously imposed (as discussed earlier) on any of the following events. H&r free file The removal from the refinery. H&r free file The entry into the United States. H&r free file The removal from a terminal by an unregistered position holder. H&r free file Upon removal from the pipeline or vessel, the diesel fuel or kerosene is not received at an approved terminal or refinery (or at another pipeline or vessel). H&r free file   The owner of the diesel fuel or kerosene when it is removed from the pipeline or vessel is liable for the tax. H&r free file However, an owner meeting all the following conditions at the time of the removal will not be liable for the tax. H&r free file The owner is a registrant. H&r free file The owner has an unexpired notification certificate (discussed under Gasoline) from the operator of the terminal or refinery where the diesel fuel or kerosene is received. H&r free file The owner has no reason to believe any information on the certificate is false. H&r free file The operator of the facility where the diesel fuel or kerosene is received is liable for the tax if the owner meets these conditions. H&r free file The operator is jointly and severally liable if the owner does not meet these conditions. H&r free file Sales to unregistered person. H&r free file   The sale of diesel fuel or kerosene located within the bulk transfer/terminal system to a person that is not a registrant is taxable if tax was not previously imposed under any of the events discussed earlier. H&r free file   The seller is liable for the tax. H&r free file However, a seller meeting all the following conditions at the time of the sale will not be liable for the tax. H&r free file The seller is a registrant. H&r free file The seller has an unexpired notification certificate (discussed under Gasoline) from the buyer. H&r free file The seller has no reason to believe any information on the certificate is false. H&r free file The buyer of the diesel fuel or kerosene is liable for the tax if the seller meets these conditions. H&r free file The buyer is jointly and severally liable if the seller does not meet these conditions. H&r free file Exception. H&r free file   The tax does not apply to a sale if all of the following apply. H&r free file The buyer's principal place of business is not in the United States. H&r free file The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel. H&r free file The seller is a registrant and the exporter of record. H&r free file The fuel was exported. H&r free file Removal or sale of blended diesel fuel or kerosene. H&r free file   The removal or sale of blended diesel fuel or blended kerosene by the blender is taxable. H&r free file Blended taxable fuel produced using biodiesel is subject to the tax. H&r free file See Blended taxable fuel under Definitions, earlier. H&r free file   The blender is liable for the tax. H&r free file The tax is figured on the number of gallons not previously subject to the tax. H&r free file   Persons who blend biodiesel with undyed diesel fuel to produce and sell or use a biodiesel mixture outside the bulk transfer/terminal system must pay the diesel fuel tax on the volume of biodiesel in the mixture. H&r free file Generally, the biodiesel mixture must be diesel fuel (defined earlier). H&r free file See Form 720 to report this tax. H&r free file You also must be registered by the IRS as a blender. H&r free file See Form 637 for more information. H&r free file   However, if an untaxed liquid is sold as taxable fuel and that untaxed liquid is used to produce blended taxable fuel, the person that sold the untaxed liquid is jointly and severally liable for the tax imposed on the blender's sale or removal of the blended taxable fuel. H&r free file Additional persons liable. H&r free file   When the person liable for the tax willfully fails to pay the tax, joint and several liability for the tax applies to: Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty; or Anyone who willfully causes the person to fail to pay the tax. H&r free file Credits or Refunds. H&r free file   A credit or refund is allowable for the tax on undyed diesel fuel or undyed kerosene used for a nontaxable use. H&r free file For more information, see chapter 2. H&r free file Dyed Diesel Fuel and Dyed Kerosene Dyed diesel fuel and dyed kerosene are subject to $. H&r free file 001 per gallon LUST tax as discussed below, unless the fuel is for export. H&r free file The excise tax is not imposed on the removal, entry, or sale of diesel fuel or kerosene (other than the LUST tax) if all the following tests are met. H&r free file The person otherwise liable for tax (for example, the position holder) is a registrant. H&r free file In the case of a removal from a terminal, the terminal is an approved terminal. H&r free file The diesel fuel or kerosene satisfies the dyeing requirements (described next). H&r free file Dyeing requirements. H&r free file   Diesel fuel or kerosene satisfies the dyeing requirements only if it satisfies the following requirements. H&r free file It contains the dye Solvent Red 164 (and no other dye) at a concentration spectrally equivalent to at least 3. H&r free file 9 pounds of the solid dye standard Solvent Red 26 per thousand barrels of fuel or any dye of a type and in a concentration that has been approved by the Commissioner. H&r free file Is indelibly dyed by mechanical injection. H&r free file See section 6 of Notice 2005-80 for transition rules that apply until final regulations are issued by the IRS. H&r free file Notice required. H&r free file   A legible and conspicuous notice stating either: DYED DIESEL FUEL, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE or DYED KEROSENE, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE must be: Provided by the terminal operator to any person that receives dyed diesel fuel or dyed kerosene at a terminal rack of that operator, and Posted by a seller on any retail pump or other delivery facility where it sells dyed diesel fuel or dyed kerosene for use by its buyer. H&r free file   The notice under item (1) must be provided by the time of the removal and must appear on all shipping papers, bills of lading, and similar documents accompanying the removal of the fuel. H&r free file   Any seller that fails to post the required notice under item (2) is presumed to know that the fuel will be used for a taxable use (a use other than a nontaxable use listed later). H&r free file That seller is subject to the penalty described next. H&r free file Penalty. H&r free file   A penalty is imposed on a person if any of the following situations apply. H&r free file Any dyed fuel is sold or held for sale by the person for a use the person knows or has reason to know is not a nontaxable use of the fuel. H&r free file Any dyed fuel is held for use or used by the person for a use other than a nontaxable use and the person knew, or had reason to know, that the fuel was dyed. H&r free file The person willfully alters, chemically or otherwise, or attempts to so alter, the strength or composition of any dye in dyed fuel. H&r free file The person has knowledge that a dyed fuel that has been altered, as described in (3) above, sells or holds for sale such fuel for any use for which the person knows or has reason to know is not a nontaxable use of the fuel. H&r free file   The penalty is the greater of $1,000 or $10 per gallon of the dyed diesel fuel or dyed kerosene involved. H&r free file After the first violation, the $1,000 portion of the penalty increases depending on the number of violations. H&r free file   This penalty is in addition to any tax imposed on the fuel. H&r free file   If the penalty is imposed, each officer, employee, or agent of a business entity who willfully participated in any act giving rise to the penalty is jointly and severally liable with that entity for the penalty. H&r free file   There is no administrative appeal or review allowed for the third and subsequent penalty imposed by section 6715 on any person except for: Fraud or a mistake in the chemical analysis, or Mathematical calculation of the penalty. H&r free file   If you are liable for the penalty, you may also be liable for the back-up tax, discussed later. H&r free file However, the penalty applies only to dyed diesel fuel and dyed kerosene, while the back-up tax may apply to other fuels. H&r free file The penalty may apply if the fuel is held for sale or use for a taxable use while the back-up tax does not apply unless the fuel is delivered into a fuel supply tank. H&r free file Exception to penalty. H&r free file   The penalty under item (3) will not apply in any of the following situations. H&r free file Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any undyed liquid and the resulting product meets the dyeing requirements. H&r free file Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any other liquid (other than diesel fuel or kerosene) that contains the type and amount of dye required to meet the dyeing requirements. H&r free file The alteration or attempted alteration occurs in an exempt area of Alaska. H&r free file See Removal for sale or use in Alaska, later. H&r free file Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with diesel fuel or kerosene not meeting the dyeing requirements and the blending occurs as part of a nontaxable use (other than export), discussed later. H&r free file Alaska and Feedstocks Tax of $. H&r free file 001 per gallon is imposed on: Undyed diesel fuel or undyed kerosene sold or used in Alaska for certain nontaxable uses (see Later sales on page 10). H&r free file Undyed kerosene used for feedstock purposes. H&r free file Removal for sale or use in Alaska. H&r free file   No tax is imposed on the removal, entry, or sale of diesel fuel or kerosene in Alaska for ultimate sale or use in certain areas of Alaska for certain nontaxable uses. H&r free file The removal or entry of any diesel fuel or kerosene is not taxed if all the following requirements are satisfied. H&r free file The person otherwise liable for the tax (position holder, refiner, or enterer): Is a registrant, Can show satisfactory evidence of the nontaxable nature of the transaction, and Has no reason to believe the evidence is false. H&r free file In the case of a removal from a terminal, the terminal is an approved terminal. H&r free file The owner of the fuel immediately after the removal or entry holds the fuel for its own use in a nontaxable use (discussed later) or is a qualified dealer. H&r free file   If all three of the requirements above are not met, then tax is imposed at $. H&r free file 244 per gallon. H&r free file   A qualified dealer is any person that holds a qualified dealer license from the state of Alaska or has been registered by the IRS as a qualified retailer. H&r free file Satisfactory evidence may include copies of qualified dealer licenses or exemption certificates obtained for state tax purposes. H&r free file Later sales. H&r free file   The excise tax applies to diesel fuel or kerosene sold by a qualified dealer after the removal or entry. H&r free file The tax is imposed at the time of the sale and the qualified dealer is liable for the tax. H&r free file However, the sale is not taxable (other than the LUST tax at $. H&r free file 001 per gallon) if all the following requirements are met. H&r free file The fuel is sold in Alaska for certain nontaxable uses. H&r free file The buyer buys the fuel for its own use in a nontaxable use or is a qualified dealer. H&r free file The seller can show satisfactory evidence of the nontaxable nature of the transaction and has no reason to believe the evidence is false. H&r free file Feedstock purposes. H&r free file   The $. H&r free file 001 per gallon LUST tax is imposed on the removal or entry of undyed kerosene if all the following conditions are met. H&r free file The person otherwise liable for tax (position holder, refiner, or enterer) is a registrant. H&r free file In the case of a removal from a terminal, the terminal is an approved terminal. H&r free file Either: The person otherwise liable for tax uses the kerosene for a feedstock purpose, or The kerosene is sold for use by the buyer for a feedstock purpose and, at the time of the sale, the person otherwise liable for tax has an unexpired certificate (described later) from the buyer and has no reason to believe any information on the certificate is false. H&r free file   If all of the requirements above are not met, then tax is imposed at $. H&r free file 244 per gallon. H&r free file   Kerosene is used for a feedstock purpose when it is used for nonfuel purposes in the manufacture or production of any substance other than gasoline, diesel fuel, or Other Fuels. H&r free file For example, kerosene is used for a feedstock purpose when it is used as an ingredient in the production of paint, but is not used for a feedstock purpose when it is used to power machinery at a factory where paint is produced. H&r free file A feedstock user is a person that uses kerosene for a feedstock purpose. H&r free file A registered feedstock user is a person that has been registered by the IRS as a feedstock user. H&r free file See Registration Requirements, earlier. H&r free file Later sales. H&r free file   The excise tax ($. H&r free file 244 per gallon) applies to kerosene sold for use by the buyer for a feedstock purpose (item (3)(b) above) if the buyer in that sale later sells the kerosene. H&r free file The tax is imposed at the time of the later sale and that seller is liable for the tax. H&r free file Certificate. H&r free file   The certificate from the buyer certifies the buyer is a registered feedstock user and the kerosene will be used by the buyer for a feedstock purpose. H&r free file The certificate may be included as part of any business records normally used for a sale. H&r free file A model certificate is shown in the Appendix as Model Certificate G. H&r free file Your certificate must contain all information necessary to complete the model. H&r free file   A certificate expires on the earliest of the following dates. H&r free file The date 1 year after the effective date (not earlier than the date signed) of the certificate. H&r free file The date the seller is provided a new certificate or notice that the current certificate is invalid. H&r free file The date the seller is notified the buyer's registration has been revoked or suspended. H&r free file   The buyer must provide a new certificate if any information on a certificate has changed. H&r free file Back-up Tax Tax is imposed on the delivery of any of the following into the fuel supply tank of a diesel-powered highway vehicle. H&r free file Any dyed diesel fuel or dyed kerosene for other than a nontaxable use. H&r free file Any undyed diesel fuel or undyed kerosene on which a credit or refund (for fuel used for a nontaxable purpose) has been allowed. H&r free file Any liquid other than gasoline, diesel fuel, or kerosene. H&r free file Generally, this back-up tax is imposed at a rate of $. H&r free file 244 per gallon. H&r free file Liability for tax. H&r free file   Generally, the operator of the vehicle into which the fuel is delivered is liable for the tax. H&r free file In addition, the seller of the diesel fuel or kerosene is jointly and severally liable for the tax if the seller knows or has reason to know that the fuel will be used for other than a nontaxable use. H&r free file Exemptions from the back-up tax. H&r free file   The back-up tax does not apply to a delivery of diesel fuel or kerosene for uses 1, 2, 6, 7, 12, 13, 14, and 15 listed under Definitions of Nontaxable Uses in chapter 2. H&r free file   In addition, since the back-up tax is imposed only on the delivery into the fuel supply tank of a diesel-powered vehicle or train, the tax does not apply to diesel fuel or kerosene used as heating oil or in stationary engines. H&r free file Diesel-Water Fuel Emulsion Diesel-water fuel emulsion means diesel fuel at least 14% of which is water and for which the emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003. H&r free file A reduced tax rate of $. H&r free file 198 per gallon is imposed on a diesel-water fuel emulsion. H&r free file To be eligible for the reduced rate, the person who sells, removes, or uses the diesel-water fuel emulsion must be registered by the IRS. H&r free file If the diesel-water fuel emulsion does not meet the requirements above, or if the person who sells, removes, or uses the fuel is not registered, the diesel-water fuel emulsion is taxed at $. H&r free file 244 per gallon. H&r free file Credits or refunds. H&r free file   The allowance for a credit or refund on a diesel-water fuel emulsion is discussed in chapter 2. H&r free file Kerosene for Use in Aviation Taxable Events Generally, kerosene is taxed at $. H&r free file 244 per gallon unless a reduced rate applies (see Diesel Fuel and Kerosene, earlier). H&r free file For kerosene removed directly from a terminal into the fuel tank of an aircraft for use in noncommercial aviation, the tax rate is $. H&r free file 219. H&r free file The rate of $. H&r free file 219 also applies if kerosene is removed into any aircraft from a qualified refueler truck, tanker, or tank wagon that is loaded with the kerosene from a terminal that is located within an airport. H&r free file The airport terminal does not need to be a secured airport terminal for this rate to apply. H&r free file However, the refueler truck, tanker, or tank wagon must meet the requirements discussed under Certain refueler trucks, tankers, and tank wagons, treated as terminals, later. H&r free file For kerosene removed directly into the fuel tank of an aircraft for use in commercial aviation, the rate of tax is $. H&r free file 044 per gallon. H&r free file For kerosene removed into an aircraft from a qualified refueler truck, tanker, or tank wagon, the $. H&r free file 044 rate applies only if the truck, tanker, or tank wagon is loaded at a terminal that is located in a secured area of the airport. H&r free file See Terminal located within a secured area of an airport, later. H&r free file In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix. H&r free file For kerosene removed directly into the fuel tank of an aircraft for a use exempt from tax under section 4041(c) (such as use in an aircraft for the exclusive use of a state or local government), the rate of tax is $. H&r free file 001. H&r free file There is no tax on kerosene removed directly into the fuel tank of an aircraft for use in foreign trade. H&r free file The kerosene must be removed from a qualifying refueler truck, tanker, or tank wagon loaded at a terminal located within a secured area of an airport. H&r free file See Terminal located within a secured area of an airport, later. H&r free file In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix. H&r free file The position holder is liable for the $. H&r free file 001 per gallon tax. H&r free file For kerosene removed directly from a terminal into the fuel tank of an fractional ownership program aircraft after March 31, 2012, a surtax of $. H&r free file 141 per gallon applies. H&r free file Certain refueler trucks, tankers, and tank wagons treated as terminals. H&r free file   For purposes of the tax imposed on kerosene for use in aviation removed directly into the fuel tank of an aircraft for use in commercial aviation, certain refueler trucks, tankers, and tank wagons are treated as part of a terminal if the following conditions are met. H&r free file Such terminal is located within an area of an airport. H&r free file Any kerosene for use in aviation that is loaded in a refueler truck, tanker, or tank wagon at a terminal is for delivery into aircraft at the airport in which the terminal is located. H&r free file Except in exigent circumstances, such as those identified in Notice 2005-80, no vehicle registered for highway use is loaded with kerosene for use in aviation at the terminal. H&r free file The refueler truck, tanker, or tank wagon meets the following requirements: Has storage tanks, hose, and coupling equipment designed and used for fueling aircraft, Is not registered for highway use, and Is operated by the terminal operator or a person that makes a daily accounting to the terminal operator of each delivery of fuel from the refueler truck, tanker, or tank wagon. H&r free file Information reporting will be required by terminal operators regarding this provision. H&r free file Until the format of this information reporting is issued, taxpayers are required to retain records regarding the daily accounting, but are not required to report such information. H&r free file Terminal located within a secured area of an airport. H&r free file   See Notice 2005-4 and Notice 2005-80 for the list of terminals located within a secured area of an airport. H&r free file This list refers to fueling operations at airport terminals as it applies to the federal excise tax on kerosene for use in aviation, and has nothing to do with the general security of airports either included or not included in the list. H&r free file Liability For Tax If the kerosene is removed directly into the fuel tank of an aircraft for use in commercial aviation, the operator of the aircraft in commercial aviation is liable for the tax on the removal at the rate of $. H&r free file 044 per gallon. H&r free file However, the position holder is liable for the LUST tax for kerosene for use in aviation removed directly into the fuel tank of an aircraft for use exempt from tax under section 4041(c) (except foreign trade). H&r free file For example, for kerosene removed directly into the aircraft for use in military aircraft, the position holder is liable for the tax. H&r free file For the aircraft operator to be liable for the tax $. H&r free file 044 rate, the position holder must meet the following requirements: Is a taxable fuel registrant, Has an unexpired certificate (a model certificate is shown in the Appendix as Model Certificate K) from the operator of the aircraft, and Has no reason to believe any of the information in the certificate is false. H&r free file Commercial aviation. H&r free file   Commercial aviation is any use of an aircraft in the business of transporting persons or property by air for pay. H&r free file However, commercial aviation does not include any of the following uses. H&r free file Any use exclusively for the purpose of skydiving. H&r free file Certain air transportation by seaplane. H&r free file See Seaplanes under Transportation of Persons by Air in chapter 4. H&r free file Any use of an aircraft owned or leased by a member of an affiliated group and unavailable for hire by nonmembers. H&r free file For more information, see Aircraft used by affiliated corporations under Special Rules on Transportation Taxes in chapter 4. H&r free file Any use of an aircraft that has a maximum certificated takeoff weight of 6,000 pounds or less, unless the aircraft is operated on an established line. H&r free file For more information, see Small aircraft under Special Rules on Transportation Taxes in chapter 4. H&r free file Any use where the surtax on fuel used in a fractional ownership program aircraft is imposed. H&r free file See Surtax on any liquid used in a fractional ownership program aircraft as fuel below. H&r free file Surtax on any liquid used in a fractional ownership program aircraft as fuel Fuel used in a fractional ownership program aircraft (as defined below) after March 31, 2012, is subject to a surtax of $. H&r free file 141 per gallon. H&r free file The fractional ownership program manager is liable for the tax. H&r free file The surtax applies in addition to any other taxes imposed on the removal, entry, use, or sale of the fuel. H&r free file If the surtax is imposed, the following air transportation taxes do not apply. H&r free file Transportation of persons by air. H&r free file Transportation of property by air. H&r free file Use of international air travel facilities. H&r free file These taxes are described under Air Transportation Taxes, later. H&r free file A fractional ownership program aircraft flight is considered noncommercial aviation, for the rules for kerosene used in noncommercial aviation, see Kerosene for Use in Aviation above. H&r free file Fractional ownership aircraft program    is a program under which:  A single fractional ownership program manager provides fractional ownership program management services on behalf of the fractional owners; There are one or more fractional owners per fractional program aircraft, with at least one fractional program aircraft having more than one owner; For at least two fractional program aircraft, none of the ownership interests in the aircraft are less than the minimum fractional ownership interest or held by the program manager; There exists a dry-lease aircraft exchange arrangement among all of the fractional owners; and There are multi-year program agreements covering the fractional ownership, fractional ownership program management services, and dry-lease aircraft exchange aspects of the program. H&r free file Fractional program aircraft. H&r free file   Any aircraft that, in any fractional ownership aircraft program, is listed as a fractional program aircraft in the management specifications issued to the manager of such program by Federal Aviation Administration under subpart K of part 91 title 14, Code of Federal Regulations, and is registered in the U. H&r free file S. H&r free file   Fractional program aircraft are not considered used for transportation of a qualified fractional owner, or on account of such qualified fractional owner when they are used for flight demonstration, maintenance or crew training. H&r free file In such situations, the flight is not commercial aviation. H&r free file Instead, the tax on the fuel used in the flight is imposed at the non-commercial aviation rate. H&r free file Fractional owner. H&r free file   Any person owning any interest (including the entire interest) in a fractional program aircraft. H&r free file Dry lease aircraft exchange. H&r free file   An agreement, documented by the written program agreements, under which the fractional program aircraft are available, on an as-needed basis without crew, to each fractional owner. H&r free file Special rule relating to deadhead service. H&r free file   A fractional program aircraft will not be considered to be used on account of a qualified fractional owner when it is used in deadhead service and a person other than a qualified fractional owner is separately charged for such service. H&r free file More information. H&r free file   See section 4043 for more information on the surtax. H&r free file Certificate for Commercial Aviation and Exempt Uses A certificate is required from the aircraft operator: To support aircraft operator liability for tax on removal of kerosene for use in aviation directly into the fuel tank of an aircraft in commercial aviation, or For exempt uses. H&r free file Certificate. H&r free file   The certificate may be included as part of any business records normally used for a sale. H&r free file See Model Certificate K in the Appendix. H&r free file   A certificate expires on the earliest of the following dates. H&r free file The date 1 year after the effective date (not earlier than the date signed) of the certificate. H&r free file The date the buyer provides the seller a new certificate or notice that the current certificate is invalid. H&r free file The date the IRS or the buyer notifies the seller that the buyer's right to provide a certificate has been withdrawn. H&r free file   The buyer must provide a new certificate if any information on a certificate has changed. H&r free file   The IRS may withdraw the buyer's right to provide a certificate if the buyer uses the kerosene for use in aviation to which a certificate relates other than as stated in the certificate. H&r free file Exempt use. H&r free file   The rate on kerosene for use in aviation is $. H&r free file 001 (LUST tax) if it is removed from any refinery or terminal directly into the fuel tank of an aircraft for an exempt use. H&r free file An exempt use includes kerosene for the exclusive use of a state or local government. H&r free file There is no tax on kerosene removed directly into the fuel tank of an aircraft for use in foreign trade. H&r free file Flash title transaction. H&r free file   A position holder is not liable for tax if, among other conditions, it obtains a certificate (described above) from the operator of the aircraft into which the kerosene is delivered. H&r free file In a “flash title transaction” the position holder sells the kerosene to a wholesale distributor (reseller) that in turn sells the kerosene to the aircraft operator as the kerosene is being removed from a terminal into the fuel tank of an aircraft. H&r free file In this case, the position holder will be treated as having a certificate from the operator of the aircraft if: The aircraft operator puts the reseller's name, address, and EIN on the certificate in place of the position holder's information; and The reseller provides the position holder with a statement of the kerosene reseller. H&r free file Reseller statement. H&r free file   This is a statement that is signed under penalties of perjury by a person with authority to bind the reseller; is provided at the bottom or on the back of the certificate (or in an attached document); and contains: The reseller's name, address, and EIN; The position holder's name, address, and EIN; and A statement that the reseller has no reason to believe that any information in the accompanying aircraft operator's certificate is false. H&r free file Credits or Refunds. H&r free file   A claim may be made by the ultimate purchaser (the operator) for taxed kerosene for use in aviation used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia). H&r free file A claim may be made by a registered ultimate vendor for certain sales. H&r free file For more information, see chapter 2. H&r free file Other Fuels (Including Alternative Fuels) Other Fuels means any liquid except gas oil, fuel oil, or any product taxable under section 4081. H&r free file Other Fuels include alternative fuels. H&r free file Alternative fuels are: Liquefied petroleum gas (LPG), “P Series” fuels, Compressed natural gas (CNG) (discussed later), Liquefied hydrogen, Any liquid fuel derived from coal (including peat) through the Fischer-Tropsch process, Liquid fuel derived from biomass, Liquefied natural gas (LNG), and Liquefied gas derived from biomass. H&r free file Liquefied petroleum gas includes propane, butane, pentane, or mixtures of those products. H&r free file Qualified methanol and ethanol fuels. H&r free file   Qualified ethanol and methanol means any liquid at least 85 percent of which consists of alcohol produced from coal, including peat. H&r free file The tax rates are listed in the Instructions for Form 720. H&r free file Partially exempt methanol and ethanol fuels. H&r free file   A reduced tax rate applies to these fuels. H&r free file Partially exempt ethanol and methanol means any liquid at least 85 percent of which consists of alcohol produced from natural gas. H&r free file The tax rates are listed in the Instructions for Form 720. H&r free file Motor vehicles. H&r free file   Motor vehicles include all types of vehicles, whether or not registered (or required to be registered) for highway use, that have both the following characteristics. H&r free file They are propelled by a motor. H&r free file They are designed for carrying or towing loads from one place to another, regardless of the type of material or load carried or t