Rev. Proc. 56-32

SECTION 1. PURPOSE.

The purpose of this Revenue Procedure is to furnish advice relative to the supporting records to be kept by manufacturers of cigars who pay tax on cigars by return, as required by section 270.224 of the Regulations relating to Cigars and Cigarettes (Manufacturers, Importers, and Dealers), as added by Treasury Decision 6185, page 917 of this Bulletin.

SEC. 2. BACKGROUND.

The National Office of the Internal Revenue Service has been informed that for years the manufacturers have been maintaining in their factories invoices and other commercial records of cigars removed subject to tax and for tax-exempt purposes. While such invoices and records show the quantities of cigars of each brand removed, the names and addresses of the persons to whom the cigars are shipped or delivered, and the prices charged for the cigars, in many cases such invoices and records do not show specifically the internal revenue classes of the cigars. However, it is understood that the classes of cigars can be readily determined from the information contained in such invoices and records.

SEC. 3. REQUIREMENTS OF THE REGULATIONS.

Section 270.224 of the regulations require that every manufacturer who pays tax on his cigars by return, Form 2135, Tax Return-Manufacturer or Importer of Cigars, shall keep a supporting record in addition to Form 2142, Record to be Kept by Manufacturer of Large Cigars, or Form 2143, Record to be Kept by Manufacturers of Small Cigars and Large or Small Cigarettes, as the case may be. Such additional supporting record shall show, with respect to each removal, the date of the removal, the name and address of the person to whom the cigars are shipped or delivered, and the class and quantity of cigars. However, the section further provides that where the manufacturer keeps copies of invoices or other commercial records containing the information required as to each removal, in such orderly manner that the information may be readily ascertained therefrom by revenue officers, such copies will be considered the supporting record required.

SEC. 4. ACCEPTABLE RECORDS.

The regulations will be satisfied as to supporting records where manufacturers maintain commercial records from which revenue officers may readily determine the classes of cigars removed, although such records do not show specifically the classes of the cigars removed.

SEC. 5. INQUIRIES.

Inquiries in regard to this Revenue Procedure should refer to the number thereof and should be directed to the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.