Rev. Rul. 58-430

Advice has been requested whether the holder of a permit to deal in specially denatured alcohol may take constructive possession of specially denatured alcohol to be shipped from any qualified denaturing plant or bonded dealer's premises directly to qualified specially denatured alcohol users under withdrawal permits, Form 1485, Application and Withdrawal Permit of User to Procure Specially Denatured Alcohol, naming the holder of the permit as the vendor.

The holder of a permit to deal in specially denatured alcohol, under section 5304 of the Internal Revenue Code of 1954, may take constructive receipt of specially denatured alcohol, as the vendor, and have the shipment made directly from the denaturing plant or another bonded dealer to the specially denatured alcohol user, provided the following conditions are complied with:

1. The qualified dealer in specially denatured alcohol taking constructive receipt of the alcohol must file a consent of surety on his bond, Form 1475, Bond of Dealer in Specially Denatured Alcohol, extending the terms thereof to cover the constructive receipt of specially denatured alcohol by him and the shipment thereof directly from the denaturing plant or another bonded dealer to the specially denatured alcohol user. Such dealer must also obtain a withdrawal permit, Form 1477, Application and Withdrawal Permit of Bonded Dealer to Procure Specially Denatured Alcohol, as required by section 182.806 of the Industrial Alcohol Regulations, which must be received by the denaturer or dealer from whom he is to procure the specially denatured alcohol before shipments thereof may be made.

2. The withdrawal permit, Form 1485, issued to the specially denatured alcohol user must show the dealer as the vendor and must contain a statement to the effect that shipment is to be made direct from the denaturing plant and/or bonded dealer named therein. The name and address of the denaturing plant and/or bonded dealer may be shown by affixing a gummed sticker to each copy of the withdrawal permit. Shipments of specially denatured alcohol may not be made until the withdrawal permit, Form 1485, has been delivered by the vendor named therein to the denaturer or the bonded dealer who is to make the shipment to the user and who is to record such shipment on the withdrawal permit.

3. Form 1473, Notice of Shipment of Specially Denatured Alcohol, must show the shipment from the denaturing plant and/or bonded dealer to the actual user and must contain the statement that the shipment is made for the account of the specially denatured alcohol dealer taking constructive receipt of the specially denatured alcohol.

4. An additional copy of Form 1473 covering the shipment must be prepared and furnished to the specially denatured alcohol dealer for his records.

5. Shipments of specially denatured alcohol must be reported on Form 1468-D, Denatured Alcohol Produced and Disposed of at Denaturing Plant, or Form 1478, Bonded Dealer's Report of Specially Denatured Alcohol, followed by a notation that shipment was made for the account of the specially denatured alcohol dealer.

6. Form 1478 filed by the specially denatured alcohol dealer taking constructive receipt of the alcohol must show the constructive receipt and shipment thereof followed by an explanatory notation that the shipment was made direct from the denaturing plant of ( Name and address of denaturer ) and/or bonded dealer ( Name and address of bonded dealer ).