SERVICE EXTENDS PROVISIONAL REGISTRATION REQUIREMENTS APPLICABLE TO TAX-FREE PURCHASES OF DIESEL FUEL AND AVIATION FUEL.

Notice 88-55

This notice extends until May 31, 1988, the period during which certain persons will be deemed to be registered as a producer under section 4101 of the Internal Revenue Code with respect to sales of fuel taxable under section 4091 of such Code, in accordance with the provisions of Notice 88-30, 1988-13 I.R.B. 7, as corrected by Anouncement 88-64, 1988-16 I.R.B. 35. Notice 88-30 described issues arising from the changes made by section 10502 of the Revenue Act of 1987 (P.L. 100-203, 101 Stat. 1330) ("1987 Act") to the excise tax on diesel fuel and aviation fuel that the Internal Revenue Service intends to address in regulations. The 1987 Act added sections 4091, 4092, and 4093 to the Code, which, beginning on April 1, 1988, moved the point of collection of the diesel fuel and aviation fuel tax from the sale by the retailer to the sale by the producer. See also Notice 88-44, 1988-16 I.R.B. 26, relating to the floor stocks tax imposed under section 10502(f) of the 1987 Act on taxable fuel held by a taxable person on April 1, 1988.

Section III(B)(1)(b) of Notice 88-30 states that the regulations relating to sales of fuel taxable under section 4091 will provide that on or after April 1, 1988, and before May 1, 1988, taxable fuel may be sold tax-free to a person who (but for not being registered under section 4101) meets the definition of the term "producer" as set forth in section III(B)(1)(a) of Notice 88-30, and that such person shall be deemed to be a registered producer during such period, provided that --

(i) The seller of taxable fuel to such person in the normal course of its business maintains on file copies of invoices of sales of taxable fuel showing the name of the purchaser, the date of sale, the type and volume of product sold, and a written statement clearly indicating that the purchaser is a producer who has furnished a certification required by section III(B)(1)(b)(ii) of Notice 88-30 to the seller, and

(ii) The seller obtains from such purchaser and keeps on file a certification, signed under penalties of perjury by a person having authority to bind the purchaser, stating the name, address, employer identification number of the purchaser, and the title of the person signing the certification.

Section III(B)(1)(b)(ii) of Notice 88-30 also provided that the certfication required by such section may cover sales of taxable fuel to a person who (but for not being registered under section 4101) meets the definition of the term "producer" as set forth in section III(B)(1)(a) of Notice 88-30, for the period from April 1, 1988, to April 30, 1988, inclusive, and shall take the following form:

"The undersigned purchaser ("Purchaser") hereby certifies that Purchaser is a producer of taxable fuel who is a refiner, compounder, blender, or wholesale distributor of a taxable fuel or a dealer selling any taxable fuel exclusively to producers of such taxable fuel. If Purchaser claims an exemption as a wholesale distributor, Purchaser certifies that Purchaser sells a taxable fuel to producers, retailers, or to users who purchase in bulk quantities and deliver into bulk storage tanks.

"Purchaser understands that any fraudulent use of this- certification to purchase any taxable fuel free of tax will subject Purchaser to penalties of perjury, which may include fine and imprisonment."

      E.I.N.:  ____________                   ____________

Section III(B)(1)(c) of Notice 88-30 states that the regulations will provide that on or after May 1, 1988, taxable fuel may be sold tax-free by a producer or importer of taxable fuel to a producer of taxable fuel under section 4091, provided that certain requirements are met.

The Internal Revenue Service recognizes that, because of time constraints, many persons who (but for not being registered under section 4101) meet the definition of the term "producer" have not yet received the Certificate of Registry required under Notice 88-30 in order to purchase taxable fuel tax-free on or after May 1, 1988. Therefore, the regulations will provide that the period during which such persons will be deemed to be a registered producer of taxable fuel for purposes of purchasing fuel tax-free as a producer under section 4093(b), and for purposes of incurring liability for the tax imposed by section 4091 is extended to include the period from May 1, 1988, to May 31, 1988, inclusive. Accordingly, a certification furnished to a seller under section III(B)(1)(b)(ii) of Notice 88-30 may be modified in writing to apply to the period from April 1, 1988, to May 31, 1988, inclusive.

Section III(B)(1)(d) of Notice 88-30 provides that an application for registry submitted on or before April 30, 1988, will be approved on a conditional basis only. In accordance with the rule of the preceding paragraph, the period during which an application for registry will be approved on a conditional basis only is also extended through May 31, 1988.

EFFECT ON OTHER DOCUMENTS

Notice 88-30 is modified.

ADMINISTRATIVE PRONOUNCEMENT

This document serves as an "administrative pronouncement" as that term is described in section 1.6661-3(b) (2) of the Income Tax Regulations and may be relied upon to the same extent as a revenue ruling or revenue procedure.

DRAFTING INFORMATION

The principal author of this notice is Lauren G. Shaw of the Legislation and Regulations Division of Chief Counsel. For further information regarding this notice, contact Ms. Shaw on (202) 566-3287 (not a toll-free call).