26 USC 4041 - Imposition of tax

U.S Code last checked for updates: Nov 22, 2024

§ 4041.

Imposition of tax

(a)

Diesel fuel and special motor fuels

(1)

Tax on diesel fuel and kerosene in certain cases

(A)

In general

There is hereby imposed a tax on any liquid other than gasoline (as defined in section 4083)—

(i)

sold by any person to an owner, lessee, or other operator of a diesel-powered highway vehicle or a diesel-powered train for use as a fuel in such vehicle or train, or

(ii)

used by any person as a fuel in a diesel-powered highway vehicle or a diesel-powered train unless there was a taxable sale of such fuel under clause (i).

(B)

Exemption for previously taxed fuel

(C)

Rate of tax

(i)

In general

(ii)

Rate of tax on trains

In the case of any sale for use, or use, of diesel fuel in a train, the rate of tax imposed by this paragraph shall be—

(I)

3.3 cents per gallon after December 31, 2004, and before July 1, 2005,

(II)

2.3 cents per gallon after June 30, 2005, and before January 1, 2007, and

(III)

0 after December 31, 2006.

(iii)

Rate of tax on certain buses

(I)

In general

(II)

School bus and intracity transportation

(2)

Alternative fuels

(A)

In general

There is hereby imposed a tax on any liquid (other than gas oil, fuel oil, or any product taxable under section 4081 (other than such tax at the Leaking Underground Storage Tank Trust Fund financing rate))—

(i)

sold by any person to an owner, lessee, or other operator of a motor vehicle or motorboat for use as a fuel in such motor vehicle or motorboat, or

(ii)

used by any person as a fuel in a motor vehicle or motorboat unless there was a taxable sale of such liquid under clause (i).

(B)

Rate of tax

The rate of the tax imposed by this paragraph shall be—

(i)

except as otherwise provided in this subparagraph, the rate of tax specified in section 4081(a)(2)(A)(i) which is in effect at the time of such sale or use,

(ii)

in the case of liquefied petroleum gas, 18.3 cents per energy equivalent of a gallon of gasoline,

(iii)

in the case of any liquid fuel (other than ethanol and methanol) derived from coal (including peat) and liquid hydrocarbons derived from biomass (as defined in section 45K(c)(3)), 24.3 cents per gallon, and

(iv)

in the case of liquefied natural gas, 24.3 cents per energy equivalent of a gallon of diesel.

(C)

Energy equivalent of a gallon of gasoline

(D)

Energy equivalent of a gallon of diesel

(3)

Compressed natural gas

(A)

In general

There is hereby imposed a tax on compressed natural gas—

(i)

sold by any person to an owner, lessee, or other operator of a motor vehicle or motorboat for use as a fuel in such motor vehicle or motorboat, or

(ii)

used by any person as a fuel in a motor vehicle or motorboat unless there was a taxable sale of such gas under clause (i).

The rate of the tax imposed by this paragraph shall be 18.3 cents per energy equivalent of a gallon of gasoline.

(B)

Bus uses

(C)

Administrative provisions

(D)

Energy equivalent of a gallon of gasoline

(b)

Exemption for off-highway business use; reduction in tax for qualified methanol and ethanol fuel

(1)

Exemption for off-highway business use

(A)

In general

(B)

Tax where other use

(C)

Off-highway business use defined

(2)

Qualified methanol and ethanol fuel

(A)

In general

In the case of any qualified methanol or ethanol fuel—

(i)

the rate applicable under subsection (a)(2) shall be the applicable blender rate per gallon less than the otherwise applicable rate (6 cents per gallon in the case of a mixture none of the alcohol in which consists of ethanol), and

(ii)

subsection (d)(1) shall be applied by substituting “0.05 cent” for “0.1 cent” with respect to the sales and uses to which clause (i) applies.

(B)

Qualified methanol and ethanol fuel produced from coal

(C)

Applicable blender rate

For purposes of subparagraph (A)(i), the applicable blender rate is—

(i)

except as provided in clause (ii), 5.4 cents, and

(ii)

for sales or uses during calendar years 2001 through 2008, ⅒ of the blender amount applicable under section 40(h)(2) for the calendar year in which the sale or use occurs.

(D)

Termination

(c)

Certain liquids used as a fuel in aviation

(1)

In general

There is hereby imposed a tax upon any liquid for use as a fuel other than aviation gasoline—

(A)

sold by any person to an owner, lessee, or other operator of an aircraft for use in such aircraft, or

(B)

used by any person in an aircraft unless there was a taxable sale of such fuel under subparagraph (A).

(2)

Exemption for previously taxed fuel

(3)

Rate of tax

(d)

Additional taxes to fund Leaking Underground Storage Tank Trust Fund

(1)

Tax on sales and uses subject to tax under subsection (a)

(2)

Liquids used in aviation

In addition to the taxes imposed by subsection (c), there is hereby imposed a tax of 0.1 cent a gallon on any liquid (other than gasoline (as defined in section 4083))—

(A)

sold by any person to an owner, lessee, or other operator of an aircraft for use as a fuel in such aircraft, or

(B)

used by any person as a fuel in an aircraft unless there was a taxable sale of such liquid under subparagraph (A).

No tax shall be imposed by this paragraph on the sale or use of any liquid if there was a taxable sale of such liquid under section 4081.

(3)

Diesel fuel used in trains

In the case of any sale for use or use after December 31, 2006, there is hereby imposed a tax of 0.1 cent per gallon on any liquid other than gasoline (as defined in section 4083)—

(A)

sold by any person to an owner, lessee, or other operator of a diesel-powered train for use as a fuel in such train, or

(B)

used by any person as a fuel in a diesel-powered train unless there was a taxable sale of such fuel under subparagraph (A).

No tax shall be imposed by this paragraph on the sale or use of any liquid if tax was imposed on such liquid under section 4081.

(4)

Termination

(5)

Nonapplication of exemptions other than for exports

[(e)

Repealed. Pub. L. 108–357, title VIII, § 853(d)(2)(C), Oct. 22, 2004, 118 Stat. 1613]

(f)

Exemption for farm use

(1)

Exemption

(2)

Use on a farm for farming purposes

(g)

Other exemptions

Under regulations prescribed by the Secretary, no tax shall be imposed under this section—

(1)

on any liquid sold for use or used as supplies for vessels or aircraft (within the meaning of section 4221(d)(3));

(2)

with respect to the sale of any liquid for the exclusive use of any State, any political subdivision of a State, or the District of Columbia, or with respect to the use by any of the foregoing of any liquid as a fuel;

(3)

upon the sale of any liquid for export, or for shipment to a possession of the United States, and in due course so exported or shipped;

(4)

with respect to the sale of any liquid to a nonprofit educational organization for its exclusive use, or with respect to the use by a nonprofit educational organization of any liquid as a fuel; and

(5)

with respect to the sale of any liquid to a qualified blood collector organization (as defined in section 7701(a)(49)) for such organization’s exclusive use in the collection, storage, or transportation of blood.

For purposes of paragraph (4), the term “nonprofit educational organization” means an educational organization described in section 170(b)(1)(A)(ii) which is exempt from income tax under section 501(a). The term also includes a school operated as an activity of an organization described in section 501(c)(3) which is exempt from income tax under section 501(a), if such school normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on.

(h)

Exemption for use by certain aircraft museums

(1)

Exemption

(2)

Definition of aircraft museum

For purposes of this subsection, the term “aircraft museum” means an organization—

(A)

described in section 501(c)(3) which is exempt from income tax under section 501(a),

(B)

operated as a museum under charter by a State or the District of Columbia, and

(C)

operated exclusively for the procurement, care, and exhibition of aircraft of the type used for combat or transport in World War II.

[(i)

Repealed. Pub. L. 108–357, title VIII, § 853(d)(2)(D), Oct. 22, 2004, 118 Stat. 1613]

(j)

Sales by United States, etc.

[(k)

Repealed. Pub. L. 108–357, title III, § 301(c)(6), Oct. 22, 2004, 118 Stat. 1461]

(l)

Exemption for certain uses

(m)

Certain alcohol fuels

(1)

In general

In the case of the sale or use of any partially exempt methanol or ethanol fuel the rate of the tax imposed by subsection (a)(2) shall be—

(A)

after September 30, 1997, and before October 1, 2028—

(i)

in the case of fuel none of the alcohol in which consists of ethanol, 9.15 cents per gallon, and

(ii)

in any other case, 11.3 cents per gallon, and

(B)

after September 30, 2028—

(i)

in the case of fuel none of the alcohol in which consists of ethanol, 2.15 cents per gallon, and

(ii)

in any other case, 4.3 cents per gallon.

(2)

Partially exempt methanol or ethanol fuel

(Aug. 16, 1954, ch. 736, 68A Stat. 478; Mar. 30, 1955, ch. 18, § 3(a)(1), 69 Stat. 14; Mar. 29, 1956, ch. 115, § 3(a)(1), 70 Stat. 66; Apr. 2, 1956, ch. 160, § 2(a)(1), 70 Stat. 89; June 29, 1956, ch. 462, title II, § 202, 70 Stat. 387; Pub. L. 85–859, title I, § 119(b)(1), Sept. 2, 1958, 72 Stat. 1286; Pub. L. 86–342, title II, § 201(b), Sept. 21, 1959, 73 Stat. 613; Pub. L. 87–61, title II, § 201(a), (c), (d), June 29, 1961, 75 Stat. 123, 124; Pub. L. 89–44, title VIII, § 802(a)(2), June 21, 1965, 79 Stat. 159; Pub. L. 91–258, title II, § 202, May 21, 1970, 84 Stat. 237; Pub. L. 91–605, title III, § 303(a)(1), (2), Dec. 31, 1970, 84 Stat. 1743; Pub. L. 94–280, title III, § 303(a)(1), (2), May 5, 1976, 90 Stat. 456; Pub. L. 94–455, title XIX, §§ 1904(a)(1)(B), (C), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1810, 1811, 1834; Pub. L. 94–530, § 1(a), Oct. 17, 1976, 90 Stat. 2487; Pub. L. 95–599, title V, § 502(a)(1), (b), Nov. 6, 1978, 92 Stat. 2756, 2757; Pub. L. 95–600, title VII, § 703(l)(1), (2), Nov. 6, 1978, 92 Stat. 2942; Pub. L. 95–618, title II, §§ 221(b)(1), 222(a)(2), 233(a)(3)(B), Nov. 9, 1978, 92 Stat. 3185, 3187, 3191; Pub. L. 96–223, title II, § 232(a)(2), Apr. 2, 1980, 94 Stat. 273; Pub. L. 96–298, § 1(a), July 1, 1980, 94 Stat. 829; Pub. L. 97–248, title II, § 279(a), (b)(1), Sept. 3, 1982, 96 Stat. 563; Pub. L. 97–424, title V, §§ 511(a)(2), (b)(1), (c)(2), (d)(2), (g)(1), 516(a)(1), (b)(1), Jan. 6, 1983, 96 Stat. 2169–2171, 2173, 2182, 2183; Pub. L. 98–369, div. A, title IX, §§ 911(a), 912(a), 913(a), title X, § 1018(a), July 18, 1984, 98 Stat. 1005, 1007, 1008, 1021; Pub. L. 99–499, title V, § 521(a)(2), (d)(1)–(3), Oct. 17, 1986, 100 Stat. 1776, 1779; Pub. L. 99–514, title IV, § 422(a)(1), (2), title XVII, § 1702(a), title XVIII, § 1878(c)(1), Oct. 22, 1986, 100 Stat. 2229, 2773, 2903; Pub. L. 100–17, title V, § 502(a)(1), (b)(1)–(3), (c)(1), Apr. 2, 1987, 101 Stat. 256, 257; Pub. L. 100–203, title X, § 10502(b), Dec. 22, 1987, 101 Stat. 1330–441; Pub. L. 100–223, title IV, §§ 402(b), 404(b), 405(b)(3), Dec. 30, 1987, 101 Stat. 1532, 1533, 1535; Pub. L. 100–647, title I, § 1017(c)(3), (4), title II, § 2001(d)(2), (3)(A)–(D), Nov. 10, 1988, 102 Stat. 3576, 3595; Pub. L. 101–508, title XI, §§ 11211(a)(4), (b)(3), (6)(C)–(E)(i), (F), (d)(1), (2), (e)(1), (2), 11213(b)(2)(A), (B), (d)(2)(B), (e)(3), Nov. 5, 1990, 104 Stat. 1388–423, 1388–425 to 1388–427, 1388–433, 1388–436; Pub. L. 102–240, title VIII, § 8002(b)(1), (2), Dec. 18, 1991, 105 Stat. 2203; Pub. L. 103–66, title XIII, §§ 13163(a)(2), 13241(b)(2)(A), (B)(iii), (c), (e), (f)(1), (2), 13242(d)(3)–(13), Aug. 10, 1993, 107 Stat. 453, 510, 511, 522–524; Pub. L. 104–188, title I, §§ 1208, 1609(a)(3), (g)(3), (4)(A), Aug. 20, 1996, 110 Stat. 1776, 1841–1843; Pub. L. 105–2, § 2(a)(3), Feb. 28, 1997, 111 Stat. 4; Pub. L. 105–34, title IX, §§ 902(b)(1), (2), 907(a), (b), title X, §§ 1031(a)(3), 1032(e)(1), (2), title XIV, § 1435(b), title XVI, § 1601(f)(4)(A), (B), Aug. 5, 1997, 111 Stat. 873, 875, 929, 935, 1053, 1090; Pub. L. 105–178, title IX, §§ 9002(a)(1)(A)–(C), 9003(a)(1)(A), (B), (b)(2)(A), 9006(a), June 9, 1998, 112 Stat. 499, 501, 502, 506; Pub. L. 105–206, title VI, § 6010(g)(1), July 22, 1998, 112 Stat. 814; Pub. L. 108–357, title II, § 241(a)(1), (2)(A), title III, § 301(c)(5), (6), title VIII, § 853(a)(6), (d)(2)(A)–(E), Oct. 22, 2004, 118 Stat. 1437, 1461, 1611–1613; Pub. L. 109–58, title XIII, § 1362(b)(2), Aug. 8, 2005, 119 Stat. 1059; Pub. L. 109–59, title XI, §§ 11101(a)(1)(A)–(C), 11113(a), 11151(e)(2), 11161(b)(1), (3)(A), Aug. 10, 2005, 119 Stat. 1943, 1946, 1969–1971; Pub. L. 109–280, title XII, § 1207(a), Aug. 17, 2006, 120 Stat. 1070; Pub. L. 109–432, div. A, title II, § 208, Dec. 20, 2006, 120 Stat. 2946; Pub. L. 110–172, § 6(d)(1)(A), (2)(A), (3), Dec. 29, 2007, 121 Stat. 2480, 2481; Pub. L. 112–30, title I, § 142(a)(1)(A), (B), (2)(A), Sept. 16, 2011, 125 Stat. 355, 356; Pub. L. 112–102, title IV, § 402(a)(1)(A), (B), (2)(A), Mar. 30, 2012, 126 Stat. 281, 282; Pub. L. 112–140, title IV, § 402(a)(1)(A), (B), (2)(A), June 29, 2012, 126 Stat. 402; Pub. L. 112–141, div. D, title I, § 40102(a)(1)(A), (B), (2)(A), July 6, 2012, 126 Stat. 844; Pub. L. 114–41, title II, § 2008(a)–(c), July 31, 2015, 129 Stat. 459, 460; Pub. L. 114–94, div. C, title XXXI, § 31102(a)(1)(A), (B), (2)(A), Dec. 4, 2015, 129 Stat. 1727; Pub. L. 117–58, div. H, title I, § 80102(a)(1)(A), (B), (2)(A), Nov. 15, 2021, 135 Stat. 1327.)

cite as: 26 USC 4041