Rev. Rul. 58-366

Advice has been requested whether the tax on admissions should be reported on Form 720, Quarterly Federal Excise Tax Return, for the tax quarter in which it is collected by the person selling the admission, or on the return for the tax quarter in which the person purchasing the admission is entitled to exercise his right to admission.

Section 4231(1) of the Internal Revenue Code of 1954 imposes a tax on the amount paid for admission to any place, including admission by means of season ticket or subscription. However, that section also provides that no tax shall be imposed (A) if the amount paid for admission is 90 cents or less, or (B) in the case of a season ticket or subscription, if the amount which would be charged to the holder or subscriber for a single admission is 90 cents or less.

Section 101.4(a) of Regulations 43, made applicable to the 1954 Code by Treasury Decision 6091, C.B. 1954-2, 47, provides that the tax in each case is to be paid by the person paying for the admission. This tax applies to the amount paid for admission, not to the admission itself, and as soon as payment for admission is made the tax attaches, whether or not the admission ever takes place.

Section 101.33(a) of the regulations and Treasury Decision 6025, C.B. 1953-2, 400, provide that every person required to collect tax on admissions shall prepare a return each quarter and the original return, along with the amount of the tax, must be filed on or before the last day of the first month following the period for which it is made. However, if, and only if, the return is accompanied by depositary receipts, showing timely deposits, in full payment of the taxes due for the calendar quarter, the return may be filed filed on or before the 10th day of the second month following the period for which it was made.

It is held that, since the tax does not apply to the admission itself, but to the payment for admission, and must be collected at the time such payment is made, the tax must be reported on Form 720, Quarterly Federal Excise Tax Return, for the quarter during which it is collected from a person purchasing admission, regardless of when the person purchasing the admission is entitled to exercise his right to admission.