SERVICE PROVIDES PROCEDURES FOR GASOHOL BLENDERS CLAIMING GASOLINE EXCISE TAX REFUND.

Notice 88-26

The purpose of this Notice is to inform gasohol blenders of the special 20-day refund procedure provided in section 6427(i)(3) of the Internal Revenue Code of 1986 ("the Code"). Under this special procedure, gasohol blenders may claim a partial refund of tax paid with respect to gasoline purchased to be blended with alcohol to produce gasohol on which tax was imposed at the 9-1/10 cents a gallon rate provided under section 4081(a) of the Code rather than the 3-4/9 cents a gallon rate of tax provided under section 4081(c)(1).

Under the conditions provided in Notice 88-2, I.R.B. 1988-2 (January 11, 1988), registered gasohol blenders are permitted to purchase gasoline for blending to produce gasohol at the reduced tax rate of 3-4/9 cents a gallon. In all other cases, gasohol blenders (like all other purchasers) must purchase gasoline at the rate provided under section 4081(a). If a gasohol blender does not purchase gasoline to be blended to produce gasohol at the reduced tax rate under the conditions provided in Notice 88-2, the special 20-day refund procedure may be used by the blender to claim a refund for the amount of tax imposed under section 4081(a) on the removal or sale of the gasoline in excess of the reduced rate of tax provided under section 4081(c)(1). To claim a refund under this special procedure, such blender must file a claim for refund on Form 843, Claim, with a statement that includes:

a. the name(s) of the supplier(s) of the gasoline and alcohol,

b. date(s) of the purchase(s),

c. total number of gallons of gasoline purchased,

d. total number of gallons of alcohol purchased, and

e. total number of gallons of gasohol produced.

In addition, the claim for refund must be for $200 or more, and only one claim per taxpayer per week will be accepted. If the Service does not process the claim and issue the refund within the 20-day period, interest from the date of the filing of the claim must be paid on the refund amount. Interest will be calculated using the rate and method under section 6621.

A Form 843 may be obtained either from the gasohol blender's local I.R.S. district office or by calling 1-800-424-FORM (3676). Gasohol blenders that qualify and file for the special 20-day refund procedure provided in section 6427(i)(3) must write "GASOHOL CLAIM" in red beside the title of Form 843 and on the envelope they send to the IRS. The Form 843 must be mailed to a special address at the same Service Center at which the gasohol blender files its tax returns. The special addresses that must be used are provided below:

                    PO Box 16053

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.

The principal author of this Notice is Timothy J. McKenna of the Legislation and Regulations Division. For further information regarding this Notice contact Tim McKenna on (202) 566-3287 (not a toll-free call).