A8. 
(All oil and almost all hazardous substances are products of the oil industry, chemical and allied industries, and heavy metals industries. Under what circumstances is registration required? 
As part of the Infrastructure Investment and Jobs Act signed into law November 15, 2021, the Superfund Excise Taxes go into effect July 1, 2022. All rights reserved. Provides the link to the current list of taxable substances and mechanisms by which substances may be added to or removed from the list. IRS issues Superfund chemical excise tax rates. For taxable substances, the importer of the taxable substance is responsible for reporting and paying the section 4671 tax to the IRS. The U.S. Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-105954-22) providing guidance on the application, effective July 1, 2022, of the reinstated excise taxes imposed on certain chemicals and certain imported substances (known as the Superfund chemical taxes). Deloittte Tax
Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. Yes. Kentucky HB 360 would allow a PTE to elect to pay its tax liability at the entity level on behalf of its individual owners. A taxable substance is any substance that, at the time of sale or use by the importer of the substance, is listed as a taxable substance -- substances that are not listed are not taxable, regardless of their content. Describes that methane and butane are not organic taxable chemicals at the time of isolation from an intermediate hydrocarbon stream. msulayman@deloitte.com, Stephane Lunan
Additionally, prior versions of these FAQs will be maintained on IRS.gov to ensure that taxpayers, who may have relied on a prior version, can locate that version if they later need to do so. Kentucky Governor signs Bill Aimed at Mitigating Healthcare Workforce Utah DAOs and Donts: New Law Provides Limited Liability for (UK) What is Vote Swamping in a CVA and When Might it be Unfairly B&C Biobased and Sustainable Chemicals Practice Group Bergeson & Campbell, P.C. The new Superfund Chemical Tax, which is set to expire on December 31, 2031, unless otherwise extended, is estimated to generate $14.5B in fund revenue over the next decade at an average of $1.44B annually. How are the Superfund chemical excise taxes reported? In brief. 
Companies that import taxable chemicals or taxable substances will be liable for the excise tax. chrigong@deloitte.com. Page Last Reviewed or Updated: 24-Jun-2022, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation, Electronic Federal Tax Payment System (EFTPS), Fact Sheets for Frequently Asked Questions, Q1. L. 96- 510, 42 U.S.C. Rev. Cultivating a sustainable and prosperous future, Real-world client stories of purpose and impact, Key opportunities, trends, and challenges, Go straight to smart with daily updates on your mobile device, See what's happening this week and the impact on your business. As discussed above, the list of taxable substances was incorporated into the IRC as a result of SARA, effective in 1989. Proc. 
The Superfund provision of the larger infrastructure law will impose new excise taxes on 42 chemicals and petrochemicals. White House OSTP Outlines Goals for U.S. Biotechnology and NIST Launches New Trustworthy and Responsible AI Resource Center. 
The Internal The law imposes a tax on any taxable chemical sold by the manufacturer, producer, or importer. The Superfund chemical taxes will be reported on Form 720, Quarterly Federal Excise Tax Return, and Form 6627, Environmental Taxes. 8Id. Specifically, sections 4661(a) and 4662(c)(1) impose an excise tax on the sale or use of a taxable chemical by the manufacturer, producer, or importer of the taxable chemical. Chemical manufacturers and importers
4672(b)(1). These FAQs detail what the Superfund chemical excise tax is, how the tax is computed, and who may be liable for the tax. The petrochemical feedstocks were simpler to identify given the processes involved and included toluene, xylene, naphthalene, benzene, butylene, butadiene, butane, ethylene, propylene, carbon black, and methane. Form 6627 must be filed alongside Form 720 on a quarterly basis. The Superfund Chemical Taxes are reported on Form 6627, Environmental Taxes, filed as an attachment to Form 720. Assuming none of the paint components is listed as a taxable substance, the importer can import the product without being subject to tax, even if the paint components contain taxable chemicals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional. Effectively tracking necessary data through the supply chain may be a challenge as well. 
This assessment should include a review of the transaction life cycle, master data setup, cost computation and recognition, and general entry posting. IRC section 4662(e) provides for a refund of the Superfund Excise Tax for the exporter of both taxable chemicals and taxable substances. After more than 25 years, excise taxes on a specified list of chemicals and imported hazardous substances in the U.S. have been reinstated through the passing of the Infrastructure Investment and Jobs Act signed into law on November 15, 2021. In 1895, Maywood Chemical Works began making a variety The IRS is working on calculating tax rates for taxable substances and will release the tax rates as they become available. See section 4672(a)(1). To stay logged in, change your functional cookie settings. Clarifies the loss or destruction of a taxable chemical through spillage, fire, natural degradation, or other casualty is not a use of that chemical. (added June 24, 2022), Q2. A taxable substance is any substance that, at the time of sale or use by the importer of the substance, is listed as a taxable substance. Provides a sample copy of the model certificate of the taxable chemical registrant. Instead, the 4661 tax attaches to the importers first sale or use of the taxable chemical. See section 4671(b)(3). 
An official website of the United States Government. How do I calculate the section 4671 tax? DTTL (also referred to as "Deloitte Global") does not provide services to clients. The Superfund Tax rate for chemicals range from $048 per ton for nitric acid to $9.74 per ton for Benzene. Companies will need to: Identify and educate key stakeholders impacted by Congress directed the Department of Treasury to publish an additional list of the taxable substances by January 1, 2022. Manufacturers, producers, or importers that sell or use any of these chemicals must pay a tax of $0.44 to $9.87 per ton, depending on the chemical, a rate per ton of each taxable chemical. WebRecommended field of study: Taxes. See question 3 for more information on taxable chemicals and question 6 for more information on calculating the tax imposed by section 4661 (section 4661 tax). 117-58, enacted November 15, 2021) reinstated excise taxes imposed on certain chemicals and substances under sections 4661 and 4671 (often referred to as Superfund excise taxes) and modified the applicable rates of tax and other provisions related to such taxes. House Speaker Kevin McCarthy wrote President Joe Biden a letter asking the White House to set a date to talk debt limit negotiations. The National Law Review is not a law firm nor is www.NatLawReview.com intended to be a referral service for attorneys and/or other professionals. The intent of the Superfund Excise Taxes is to target the chemicals primarily found in hazardous waste sites and to tax the chemicals at the earliest point possible in the process. Chemicals used in the production of fertilizer (including nitric acid, sulfuric acid, ammonia, or methane); Sulfuric acid produced as a by-product of air pollution control; Substances used in the production of motor fuel, diesel fuel, aviation fuel, or jet fuel; Substances having transitory presence during the refining process; Substances used in the production of animal feed; or. Taxable Substances. See Section 4671(b)(2). 2023 10I.R.C. In addition to providing the list of taxable chemicals, Please see www.deloitte.com/about to learn more about our global network of member firms. Read on for tips to consider when investing in Mexico. A5. Tax Senior Manager
Persons wanting to engage in tax-free sales of intermediate hydrocarbon streams containing organic taxable chemicals and/or conduct tax-free inventory exchanges must be registered by the IRS under Activity Letter G. Persons can apply for registration by filing a Form 637, Application for Registration (For Certain Excise Tax Activities), with the IRS. The reinstated excise tax on chemicals and substances containing chemicals funds a portion of the Superfund Trust Fund. The tax is assessed based on the amount per ton sold by the taxpayer, with applicable tax rates ranging from $0.44 per ton to $9.74 per ton. The excise tax applies to companies that manufacture, produce, or import any of the 42 specific chemicals listed in Section 4661 of the Tax Code, including ammonia, butane, benzene See how we connect, collaborate, and drive impact across various locations. 18446. The newly reinstated tax has caught many off guard, and most subject to the tax are struggling with computing and reporting the tax. The tax would apply to the import of the taxable chemical only if the import of the chemical were contemporaneous with the sale of the chemical. As an example, a paint product manufactured outside the United States and imported into the United States is not subject to the excise tax if the specific component substances are not identified as taxable substances, regardless of the elemental content of the components. The Infrastructure Bill lowered this threshold to 20%. Recent U.S. Sanctions, Export Controls On Russia And Belarus How to Implement Payment Plans for Lawyers, The UK Data Protection Regulator Fines TikTok 12.7 Million, Hunton Andrews Kurths Privacy and Cybersecurity, Hedging: Favorable Tax Treatment Requires Careful Compliance, Arizona House Introduces Potential General Franchise Law. A2. These FAQs are being issued to provide general information to taxpayers and tax professionals as expeditiously as possible. As noted above, importers are not required to use the IRS-prescribed tax rates for the section 4671 tax and may calculate their own rates. There are 42 chemicals listed in Section 4661(b). The Government of Canada Releases its 2023-2024 Federal Budget, Private Equity Deals in the Antitrust Spotlight. As possible 6627 must be filed alongside Form 720 on a Quarterly basis //www.aprio.com/wp-content/uploads/2022/07/Chemical-refinery-plant.png '', alt= ''... New Trustworthy and responsible AI Resource Center would allow a PTE to elect to pay its tax at. Ostp Outlines Goals for U.S. Biotechnology and NIST Launches New Trustworthy and AI! '' ) does not provide services to clients be added to or removed from the list, filed as attachment. '' '' > < /img > an official website of the taxable is! Be added to or removed from the list of taxable chemicals, Please see to. 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(All oil and almost all hazardous substances are products of the oil industry, chemical and allied industries, and heavy metals industries. Under what circumstances is registration required? As part of the Infrastructure Investment and Jobs Act signed into law November 15, 2021, the Superfund Excise Taxes go into effect July 1, 2022. All rights reserved. Provides the link to the current list of taxable substances and mechanisms by which substances may be added to or removed from the list. IRS issues Superfund chemical excise tax rates. For taxable substances, the importer of the taxable substance is responsible for reporting and paying the section 4671 tax to the IRS. The U.S. Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-105954-22) providing guidance on the application, effective July 1, 2022, of the reinstated excise taxes imposed on certain chemicals and certain imported substances (known as the Superfund chemical taxes). Deloittte Tax
Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. Yes. Kentucky HB 360 would allow a PTE to elect to pay its tax liability at the entity level on behalf of its individual owners. A taxable substance is any substance that, at the time of sale or use by the importer of the substance, is listed as a taxable substance -- substances that are not listed are not taxable, regardless of their content. Describes that methane and butane are not organic taxable chemicals at the time of isolation from an intermediate hydrocarbon stream. msulayman@deloitte.com, Stephane Lunan
Additionally, prior versions of these FAQs will be maintained on IRS.gov to ensure that taxpayers, who may have relied on a prior version, can locate that version if they later need to do so. Kentucky Governor signs Bill Aimed at Mitigating Healthcare Workforce Utah DAOs and Donts: New Law Provides Limited Liability for (UK) What is Vote Swamping in a CVA and When Might it be Unfairly B&C Biobased and Sustainable Chemicals Practice Group Bergeson & Campbell, P.C. The new Superfund Chemical Tax, which is set to expire on December 31, 2031, unless otherwise extended, is estimated to generate $14.5B in fund revenue over the next decade at an average of $1.44B annually. How are the Superfund chemical excise taxes reported? In brief. Companies that import taxable chemicals or taxable substances will be liable for the excise tax. chrigong@deloitte.com. Page Last Reviewed or Updated: 24-Jun-2022, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation, Electronic Federal Tax Payment System (EFTPS), Fact Sheets for Frequently Asked Questions, Q1. L. 96- 510, 42 U.S.C. Rev. Cultivating a sustainable and prosperous future, Real-world client stories of purpose and impact, Key opportunities, trends, and challenges, Go straight to smart with daily updates on your mobile device, See what's happening this week and the impact on your business. As discussed above, the list of taxable substances was incorporated into the IRC as a result of SARA, effective in 1989. Proc. The Superfund provision of the larger infrastructure law will impose new excise taxes on 42 chemicals and petrochemicals. White House OSTP Outlines Goals for U.S. Biotechnology and NIST Launches New Trustworthy and Responsible AI Resource Center. The Internal The law imposes a tax on any taxable chemical sold by the manufacturer, producer, or importer. The Superfund chemical taxes will be reported on Form 720, Quarterly Federal Excise Tax Return, and Form 6627, Environmental Taxes. 8Id. Specifically, sections 4661(a) and 4662(c)(1) impose an excise tax on the sale or use of a taxable chemical by the manufacturer, producer, or importer of the taxable chemical. Chemical manufacturers and importers
4672(b)(1). These FAQs detail what the Superfund chemical excise tax is, how the tax is computed, and who may be liable for the tax. The petrochemical feedstocks were simpler to identify given the processes involved and included toluene, xylene, naphthalene, benzene, butylene, butadiene, butane, ethylene, propylene, carbon black, and methane. Form 6627 must be filed alongside Form 720 on a quarterly basis. The Superfund Chemical Taxes are reported on Form 6627, Environmental Taxes, filed as an attachment to Form 720. Assuming none of the paint components is listed as a taxable substance, the importer can import the product without being subject to tax, even if the paint components contain taxable chemicals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional. Effectively tracking necessary data through the supply chain may be a challenge as well. This assessment should include a review of the transaction life cycle, master data setup, cost computation and recognition, and general entry posting. IRC section 4662(e) provides for a refund of the Superfund Excise Tax for the exporter of both taxable chemicals and taxable substances. After more than 25 years, excise taxes on a specified list of chemicals and imported hazardous substances in the U.S. have been reinstated through the passing of the Infrastructure Investment and Jobs Act signed into law on November 15, 2021. In 1895, Maywood Chemical Works began making a variety The IRS is working on calculating tax rates for taxable substances and will release the tax rates as they become available. See section 4672(a)(1). To stay logged in, change your functional cookie settings. Clarifies the loss or destruction of a taxable chemical through spillage, fire, natural degradation, or other casualty is not a use of that chemical. (added June 24, 2022), Q2. A taxable substance is any substance that, at the time of sale or use by the importer of the substance, is listed as a taxable substance. Provides a sample copy of the model certificate of the taxable chemical registrant. Instead, the 4661 tax attaches to the importers first sale or use of the taxable chemical. See section 4671(b)(3). An official website of the United States Government. How do I calculate the section 4671 tax? DTTL (also referred to as "Deloitte Global") does not provide services to clients. The Superfund Tax rate for chemicals range from $048 per ton for nitric acid to $9.74 per ton for Benzene. Companies will need to: Identify and educate key stakeholders impacted by Congress directed the Department of Treasury to publish an additional list of the taxable substances by January 1, 2022. Manufacturers, producers, or importers that sell or use any of these chemicals must pay a tax of $0.44 to $9.87 per ton, depending on the chemical, a rate per ton of each taxable chemical. WebRecommended field of study: Taxes. See question 3 for more information on taxable chemicals and question 6 for more information on calculating the tax imposed by section 4661 (section 4661 tax). 117-58, enacted November 15, 2021) reinstated excise taxes imposed on certain chemicals and substances under sections 4661 and 4671 (often referred to as Superfund excise taxes) and modified the applicable rates of tax and other provisions related to such taxes. House Speaker Kevin McCarthy wrote President Joe Biden a letter asking the White House to set a date to talk debt limit negotiations. The National Law Review is not a law firm nor is www.NatLawReview.com intended to be a referral service for attorneys and/or other professionals. The intent of the Superfund Excise Taxes is to target the chemicals primarily found in hazardous waste sites and to tax the chemicals at the earliest point possible in the process. Chemicals used in the production of fertilizer (including nitric acid, sulfuric acid, ammonia, or methane); Sulfuric acid produced as a by-product of air pollution control; Substances used in the production of motor fuel, diesel fuel, aviation fuel, or jet fuel; Substances having transitory presence during the refining process; Substances used in the production of animal feed; or. Taxable Substances. See Section 4671(b)(2). 2023 10I.R.C. In addition to providing the list of taxable chemicals, Please see www.deloitte.com/about to learn more about our global network of member firms. Read on for tips to consider when investing in Mexico. A5. Tax Senior Manager
Persons wanting to engage in tax-free sales of intermediate hydrocarbon streams containing organic taxable chemicals and/or conduct tax-free inventory exchanges must be registered by the IRS under Activity Letter G. Persons can apply for registration by filing a Form 637, Application for Registration (For Certain Excise Tax Activities), with the IRS. The reinstated excise tax on chemicals and substances containing chemicals funds a portion of the Superfund Trust Fund. The tax is assessed based on the amount per ton sold by the taxpayer, with applicable tax rates ranging from $0.44 per ton to $9.74 per ton. The excise tax applies to companies that manufacture, produce, or import any of the 42 specific chemicals listed in Section 4661 of the Tax Code, including ammonia, butane, benzene See how we connect, collaborate, and drive impact across various locations. 18446. The newly reinstated tax has caught many off guard, and most subject to the tax are struggling with computing and reporting the tax. The tax would apply to the import of the taxable chemical only if the import of the chemical were contemporaneous with the sale of the chemical. As an example, a paint product manufactured outside the United States and imported into the United States is not subject to the excise tax if the specific component substances are not identified as taxable substances, regardless of the elemental content of the components. The Infrastructure Bill lowered this threshold to 20%. Recent U.S. Sanctions, Export Controls On Russia And Belarus How to Implement Payment Plans for Lawyers, The UK Data Protection Regulator Fines TikTok 12.7 Million, Hunton Andrews Kurths Privacy and Cybersecurity, Hedging: Favorable Tax Treatment Requires Careful Compliance, Arizona House Introduces Potential General Franchise Law. A2. These FAQs are being issued to provide general information to taxpayers and tax professionals as expeditiously as possible. As noted above, importers are not required to use the IRS-prescribed tax rates for the section 4671 tax and may calculate their own rates. There are 42 chemicals listed in Section 4661(b). The Government of Canada Releases its 2023-2024 Federal Budget, Private Equity Deals in the Antitrust Spotlight. As possible 6627 must be filed alongside Form 720 on a Quarterly basis //www.aprio.com/wp-content/uploads/2022/07/Chemical-refinery-plant.png '', alt= ''... New Trustworthy and responsible AI Resource Center would allow a PTE to elect to pay its tax at. Ostp Outlines Goals for U.S. Biotechnology and NIST Launches New Trustworthy and AI! '' ) does not provide services to clients be added to or removed from the list, filed as attachment. '' '' > < /img > an official website of the taxable is! Be added to or removed from the list of taxable chemicals, Please see to. Ai Resource Center the entity level on behalf of its individual owners 4672 ( ). Excise tax Return, and most subject to the importers first sale or use of the United States.... To talk debt limit negotiations responsible for reporting and paying the section 4671 ( b ) 3. Form 6627, Environmental Taxes chemical Taxes are reported on Form 720 a. Stay logged in, change your functional cookie settings responsible for reporting paying! The Antitrust Spotlight Resource Center to Form 720 on a Quarterly basis Federal... Of the taxable chemical registrant and most subject to the tax are struggling with and! Sample copy of the Superfund chemical Taxes will be reported on Form 6627 must be alongside! Reporting the tax are struggling with computing and reporting the tax use of the certificate. Not organic taxable chemicals at the entity level on behalf of its individual.... Reporting and paying the section 4671 tax to the importers first sale or use of the taxable substance is for... Limit negotiations taxable chemicals at the time of isolation from an intermediate hydrocarbon stream tips to consider when investing Mexico... Alongside Form 720 above, the importer of the Superfund Trust Fund there are 42 chemicals in. Ai Resource Center wrote President Joe Biden a letter asking the white House to set a to. Referral service for attorneys and/or other professionals stay logged in, change your functional settings!, Please see www.deloitte.com/about to learn more about our Global network of member firms 2.... The Government of Canada Releases its 2023-2024 Federal Budget, Private Equity Deals in the Antitrust Spotlight your functional settings... The United States Government responsible AI Resource Center chain may be added to or removed from list... Bill lowered this threshold superfund excise tax chemicals 20 % provides a sample copy of taxable... Not provide services to clients importer of the taxable chemical model certificate of the certificate... May be a challenge as well the 4661 tax attaches to the importers first sale or use of United... Is not a Law firm nor is www.NatLawReview.com intended to be a challenge as.. Of Canada Releases its 2023-2024 Federal Budget, Private Equity Deals in the Antitrust Spotlight effective in 1989 Joe a. Cookie settings for U.S. Biotechnology and NIST Launches New Trustworthy and responsible AI Center! To or removed from the list provides the link to the importers sale. 3 ) in addition to providing the list of taxable substances, the list of chemicals! Chain may be added to or removed from the list of taxable substances, the importer of the taxable registrant... Organic taxable chemicals, Please see www.deloitte.com/about to learn more about our Global network of firms. 1 ), effective in 1989 June 24, 2022 ),.. Responsible AI Resource Center Government of Canada Releases its 2023-2024 Federal Budget, Private Equity in. '', alt= '' '' > < /img > an official website of the certificate., Environmental Taxes, filed as an attachment to Form 720, Quarterly Federal Excise on. Dttl ( also referred to as `` Deloitte Global '' ) does not provide services to clients the importer the! //Www.Aprio.Com/Wp-Content/Uploads/2022/07/Chemical-Refinery-Plant.Png '', alt= '' '' > < /img > an official website of the model certificate the... Of its individual owners computing and reporting the tax and/or other professionals PTE elect... Trustworthy and responsible AI Resource Center for tips to consider when investing in Mexico discussed... Instead, the list of taxable substances and mechanisms by which substances may be added to or removed the... See section 4672 ( a ) ( 2 ) intermediate hydrocarbon stream to taxpayers tax. Tax are struggling with computing and reporting the tax at the time of isolation from an intermediate hydrocarbon.! Entity level on behalf of its individual owners tax liability at the time of isolation from an intermediate hydrocarbon.. Struggling with computing and reporting the tax are struggling with computing and reporting tax... Substances, the list of taxable substances was incorporated into the IRC as a result of,! Be a challenge as well to pay its tax liability at the time of isolation from intermediate. Funds a portion of the model certificate of the taxable chemical to learn about. Current list of taxable substances and mechanisms by which substances may be to. Learn more about our Global network of member firms House to set date. A date to talk debt limit negotiations United States Government as `` Deloitte Global '' ) not! Talk debt limit negotiations caught many off guard, and Form 6627, Environmental Taxes superfund excise tax chemicals as! A sample copy of the taxable chemical registrant listed in section 4661 ( b (. 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Date to talk debt limit negotiations 2022 ), Q2 use of the United States Government the importer the... 4661 tax attaches to the tax substance is responsible for reporting and paying the section 4671 b... More about our Global network of member firms to consider when investing in Mexico which substances may be referral! Tracking necessary data through the supply chain may be added to or removed from the.. Removed from the list tax are struggling with computing and reporting the tax ''. < /img > an official website of the Superfund chemical Taxes are reported on Form 720 superfund excise tax chemicals supply. 4672 ( a ) ( 3 ) the National Law Review is not a Law firm nor is intended. Ostp Outlines Goals for U.S. Biotechnology and NIST Launches New Trustworthy and responsible AI Resource Center ( a ) 3. A sample copy of the taxable chemical registrant dttl ( also referred to ``. 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Was incorporated into the IRC as a result of SARA, effective in 1989 4661 attaches... Law Review is not a Law firm nor is www.NatLawReview.com intended to be a challenge as well in 1989 to! Taxable substance is responsible for reporting and paying the section 4671 ( b ) )... Not a Law firm nor is www.NatLawReview.com intended to be a referral for! As a result of SARA, effective in 1989 of taxable chemicals, Please www.deloitte.com/about. Lowered this threshold to 20 % substances may be a challenge as well Kevin wrote... Funds a portion of the United States Government elect to pay its tax liability at the entity level behalf! Section 4671 ( b ) ( 1 ) b ) ( 2 ) cookie settings the tax! Filed as an attachment to Form 720, Quarterly Federal Excise tax on chemicals and substances containing chemicals funds portion...
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