Rev. Proc. 59-5

SECTION 1. PURPOSE.

The purpose of this Revenue Procedure is to advise proprietors of distilleries, rectifying plants, bonded wine cellars, breweries, and tax-paid bottling houses, importers, wholesale and retail dealers, and others concerned, of the claims procedures established with respect to beer which was lost, rendered unmarketable, or condemned by reason of the floods of 1951 or the hurricanes of 1954, and the losses caused by disasters occurring during the periods January 1, 1955, to September 2, 1958, and September 3, 1958, to June 30, 1959.

SEC. 2. BACKGROUND.

Section 207 of the Excise Tax Technical Changes Act of 1958, Public Law 85-859, C.B. 1958-3, 92, authorizes the payment, under certain conditions, of an amount equal to the amount of internal revenue tax paid under section 3150(a) of the Internal Revenue Code of 1939 on any beer which was lost, rendered unmarketable, or condemned by a duly authorized health official of the United States or of a State by reason of the floods of 1951 or the hurricanes of 1954. Section 5064 of the Internal Revenue Code of 1954, as amended by the Act, makes provision for the payment, without interest, of an amount equal to the internal revenue tax paid or determined and customs duties paid on distilled spirits, wines, rectified products, and beer lost, rendered unmarketable, or condemned by reason of a major disaster occurring after June 30, 1959. Similar payments are authorized under section 208 of the Act as to disaster losses during the period January 1, 1955, to September 2, 1958, inclusive. Similar payments are also authorized as to disaster losses during the period September 3, 1958, to June 30, 1959, inclusive, by reason of section 210(a)(3) of the Act, under which provisions having the effect of section 5064 of the Code are made applicable to such period.

SEC. 3. CLAIMS BASED ON BEER LOST BY REASON OF FLOODS OF 1951 OR HURRICANES OF 1954.

Claims may be filed, in accordance with the provisions of subpart I of the Miscellaneous Regulations Relating to Liquor, as added by Treasury Decision 6316, C.B. 1958-2, 978, covering the tax paid on beer lost, rendered unmarketable, or condemned by reason of the floods of 1951 or hurricanes of 1954 and which was in the possession of the brewer or importer who paid the tax or in the possession of a wholesale or retail dealer, at the time it was lost, rendered unmarketable, or condemned. Such claims must be filed on or before March 3, 1959. Where beer was lost while in the possession of a dealer and the lost beer has been replaced for the possessor or reimbursement therefor has been made to him by the brewer or importer, either directly or through a wholesale dealer, all parties to the transaction must join in Form 843, Claim, by appropriate certification and signatures.

SEC. 4. CLAIMS FOR LOSSES SUSTAINED BY REASON OF DISASTERS OCCURRING DURING THE PERIOD JANUARY 1, 1955, TO SEPTEMBER 2, 1958.

Claims may be filed covering distilled, spirits, wines, rectified products, and beer lost, rendered unmarketable, or condemned by reason of `major disasters' occurring during the period January 1, 1955, to September 2, 1958, inclusive. Claims may be filed only with respect to such products which, at the time of the disaster, were in the possession of the payer of the tax, or tax and duty, or person who was obligated to pay the tax; in the possession of the bottler; or in the possession of a wholesale or retail dealer. Such claims must be filed in accordance with the provisions of subpart F of the Miscellaneous Regulations Relating to Liquor, as added by Treasury Decision 6315, C.B. 1958-2, 962, and must be filed no later than March 2, 1959.

Where the spirits, wines, rectified products, or beer were in the possession of a dealer when lost, and replacement has been made by the distiller, winemaker, brewer, rectifier, importer, or wholesaler, either directly or through a wholesale dealer, all parties to the transaction must join in the claim by appropriate certification and signature.

SEC. 5. CLAIMS FOR LOSSES SUSTAINED BY REASON OF DISASTERS OCCURRING DURING THE PERIOD SEPTEMBER 3, 1958, TO JUNE 30, 1959.

The procedure for the filing of claims covering distilled spirits, wines, rectified products, and beer lost, rendered unmarketable, or condemned by reason of `major disasters' occurring during the period September 3, 1958, to June 30, 1959, inclusive, is prescribed by subpart G of the regulations, as added by Treasury Decision 6315, supra . Such claim may be filed only by the person who held the products for sale at the time of the disaster and must be filed within 6 months after the date on which the President makes the determination that the `major disaster' has occurred.

SEC. 6. PROCEDURE FOR THE EXECUTION AND FILING OF CLAIMS.

.01 In the interest of clarity and to avoid confusion in the preparation and distribution of refund checks it is desirable that only one name be shown on the Claim, Form 843, on the line for the name of the taxpayer. This, of course, is not intended to apply where the claim is being filed by a partnership. In the case of claims under subparts F and I, the name appearing on this line should be that of the person or company bearing the ultimate burden of the replacement, reimbursement, or credit given; in the case of claims under subpart G, such name would be that of the person holding the liquors for sale at the time of disaster.

.02 Insofar as signing the claim is concerned, there is room for variation in procedure, depending on the specific facts in the case. For example, where a claim is filed by a wholesale distributor and there is only one or possibly two or three possessors or recipients, and they are in the same town as the claimant, there would seem to be little reason why all concerned could not join in the claim by signing the Form 843, provided the status of each signator is made clear. In such case the certification should be in substantially the following forms:

We certify that this claim is based on replacement by (name of party making replacement) to (name of retailer); or

We certify that this claim is based on replacement by (name of brewer or importer) through (name of wholesaler) to (name or retailer).

However, in those cases where the claim is filed by the person or company originally paying the tax and there are a number of possessors joining in the claim, perhaps located in various towns, it may be advisable to have such persons join in the claim by affidavit. This would require that each claimant submit an affidavit to be attached to and made part of the claim in which each would set forth among other things that he is joining in the claim with the person actually submitting such claim. Either of the two methods outlined above is satisfactory.

.03 The most important facts to be kept in mind in preparing the claims are that the person or company to whom payment is to be made is set forth clearly and that there be only one such person, partnership, or corporation shown in the line on Form 843 which calls for the name of the taxpayer, and that persons joining in the claim sign the Form 843 or join in by means of an affidavit so stating, depending on which method may prove the most convenient. Such affidavit should also make it clear that those joining will not file another claim covering the same liquors, since it is entirely possible that a possessor or recipient may join in more than one claim.

.04 Each claim should be accompanied by supporting data clearly identifying the liquors lost in as much detail as is necessary to establish the extent of the loss and to prevent allowance of more than one claim covering the identical liquors or any part thereof.

SEC. 7. PROCEDURE WHERE THE PERSON EXPECTED TO JOIN IN A CLAIM DOES NOT DO SO.

The Alcohol and Tobacco Tax Division is now considering and will propose an amendment of subparts F and I of the Miscellaneous Regulations Relating to Liquors to permit Assistant Regional Commissioners to consider claims for allowance when there is satisfactory evidence showing that the joining in a claim by a recipient of replacement, reimbursement, or credit could not be accomplished. If approved by the Secretary of the Treasury, this amendment would afford relief in the instances indicated. However, the six-month statutory period for filing these claims may expire before the proposed amendment can be processed. Accordingly, to be entitled to relief under the proposed amendment, if approved, the claimant should perfect his claim to the greatest possible extent under the existing regulations and file the claim before expiration of the deadline for filing. Such claims should include a statement regarding the identity of the person (or persons) not joining in the claim, the reason for his not joining, his last known address, and the extent and results of efforts made to obtain compliance. Such claims particularly must set forth all information obtained which was pertinent to the possessor's indemnification by insurance or otherwise against loss of the tax, or tax and customs duty, as the case may be.

SEC. 8. LAST DAY FOR FILING CLAIMS.

The last day for filing claims under subpart F (losses by `major disasters' occurring January 1, 1955, through September 2, 1958) is March 2, 1959. The last day for filing claims under subpart I (beer losses-floods of 1951 and hurricanes of 1954) is March 3, 1959. Claims under subpart G must be filed within six months after the date on which the President makes the determination that the `major disaster' has occurred.

SEC. 9. INQUIRIES.

Inquiries concerning this Revenue Procedure should refer to its number and be addressed to the office of the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.