Internal Revenue Service, Treasury § 48.4081–2
practical and commercial fitness solely sentence in the definition of terminal by reason of its possible or rare use as are effective January 2, 1998. a fuel in the propulsion engine of a [T.D. 8659, 61 FR 10453, Mar. 14, 1996, as highway vehicle, train, or boat. amended by T.D. 8748, 63 FR 25, Jan. 2, 1998] (iii) Cross reference. For the tax on blended taxable fuel, see § 48.4081–3(g). § 48.4081–1T Taxable fuel; definitions For the back-up tax on certain uses of (temporary). liquids other than diesel fuel, see (a) [Reserved] § 48.4082–4. (b) Definitions. (3) Gasoline blendstocks—(i) In general. Kerosene means, after June 30, 1998— Except as provided in paragraph (1) The two grades of kerosene (No. 1– (c)(3)(ii) of this section, gasoline K and No. 2–K) described in ASTM blendstocks means— Specification D 3699; and (A) Alkylate; (2) Kerosene-type jet fuel described in (B) Butane; ASTM Specification D 1655 and mili- tary specifications MIL–T–5624R and (C) Butene; MIL–T–83133D (Grades JP–5 and JP–8). (D) Catalytically cracked gasoline; For availability of ASTM and military (E) Coker gasoline; specification material, see § 48.4081– (F) Ethyl tertiary butyl ether 1(c)(2)(i). (ETBE); (G) Hexane; [T.D. 8774, 63 FR 35801, July 1, 1998] (H) Hydrocrackate; § 48.4081–2 Taxable fuel; tax on re- (I) Isomerate; moval at a terminal rack. (J) Methyl tertiary butyl ether (a) Overview. This section provides (MTBE); the general rule that all removals of (K) Mixed xylene (not including any taxable fuel at a terminal rack are sub- separated isomer of xylene); ject to tax and the position holder with (L) Natural gasoline; respect to the fuel is liable for the tax. (M) Pentane; (b) Imposition of tax. Except as pro- (N) Pentane mixture; vided in § 48.4081–4 (relating to gasoline (O) Polymer gasoline; blendstocks) and § 48.4082–1 (relating to (P) Raffinate; dyed diesel fuel), tax is imposed on the removal of taxable fuel from a ter- (Q) Reformate; minal if the taxable fuel is removed at (R) Straight-run gasoline; the rack. (S) Straight-run naphtha; (c) Liability for tax—(1) In general. The (T) Tertiary amyl methyl ether position holder with respect to the tax- (TAME); able fuel is liable for the tax imposed (U) Tertiary butyl alcohol (gasoline under paragraph (b) of this section. grade) (TBA); (2) Joint and several liability of terminal (V) Thermally cracked gasoline; operator; unregistered position holder—(i) (W) Toluene; and In general. The terminal operator is (X) Transmix containing gasoline. jointly and severally liable for the tax imposed under paragraph (b) of this (ii) Exclusion. Gasoline blendstocks section if— does not include any product that can- (A) The position holder with respect not, without further processing, be to the taxable fuel is a person other used in the production of finished gaso- than the terminal operator and is not a line. For example, a mixed hydro- taxable fuel registrant; and carbon stream that is produced in a (B) The terminal operator has not natural gas processing plant is not a met the conditions of paragraph gasoline blendstock if the stream can- (c)(2)(ii) of this section. not be used to produce finished gaso- (ii) Conditions for avoidance of liabil- line without further processing. ity. A terminal operator is not liable (d) Effective date. This section is ap- for tax under this paragraph (c)(2) if, at plicable January 1, 1994, except that in the time of the removal, the terminal paragraph (b) of this section the defini- operator— tion of aviation gasoline and the third (A) Is a taxable fuel registrant;
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