highway motor vehicle is owned by the United States."

(Sec. 4483, Pub. Law 627, 84th Cong.)

§ 41.4483-1

State and local governmental exemption.

Use by any State or any political subdivision thereof of any highway motor vehicle is exempt from the tax imposed by section 4481. For definition of the term "State", see § 41.4482(c)-1. For purposes of this section, the term "use by any State or any political subdivision thereof" means the operation by any State or any political subdivision thereof on the public highways in the United States of any highway motor vehicle, whether or not such highway motor vehicle is owned by the State or the political subdivision.

§ 41.4483-2

Exemption for certain transit-type buses.

(a) In general. Use in any taxable period, or part thereof, of any bus of the transit type by any person who is engaged in the operation of a transit system is exempt from the tax, if such person meets the 60-percent passenger fare revenue test provided for in section 6421(b) (2), as set forth in paragraph (e) of this section, for the applicable period prescribed in paragraph (c) of this section as the test period for such person for such system for such taxable period, or part thereof.

(b) Buses of the transit type. The term "transit type", when used in the regulations in this part with reference to a bus, means the type of bus which is designed for the mass transportation of persons within an urban area, as distinguished from the intercity-type bus. A transit-type bus is ordinarily distinguishable from an intercity-type bus by comparison of seats, doors, and baggage facilities. The transit-type bus usually has straight-back seats of the bench type, while the intercity-type bus generally has seats which either can be reclined or are in fact permanently fixed in a reclining position. The transit-type bus is more likely to have an accordion or folding-type door at the front of the bus, and often has a second door in the middle or at the rear for passengers to leave the bus, as opposed to the emergencytype rear door which may or may not be included in the intercity-type bus. The typical transit-type bus does not have facilities for storing baggage whereas the typical intercity-type bus has facili

ties for storing baggage in a compartment underneath the floor of the bus or in overhead racks, or both. Other characteristics which may be taken into account in distinguishing a transit-type bus from an intercity-type bus include gear ratios, acceleration and maximum speed, and aisle space for standees. The transit-type bus ordinarily has a lower gear ratio to provide for quick starts and because, in general, buses of this type are operated at low speeds. The intercity-type bus ordinarily has a higher gear ratio and can be operated at much higher speeds. The transit-type bus usually has wider aisles, with overhead straps or bars to accommodate standees.

(c) Test period. (1) In the case of any person who is engaged in the operation of a transit system at any time in the calendar quarter immediately preceding July 1 of any taxable period, the test period for such system for such taxable period shall be such calendar quarter. However, if passenger fare revenue from scheduled service described in paragraph (e) of this section was derived on less than 30 days during such calendar quarter from operation of such system, the test period for such system for such taxable period shall be the last preceding test period for such system. If such system has no preceding test period, then the test period for such system for such taxable period shall be the calendar quarter beginning with July 1 of such taxable period.

(2) Except as otherwise provided in subparagraph (3) of this paragraph, in the case of any person who commences operation of a transit system at any time on or after July 1 of any taxable period the test period for such system for that part of such taxable period beginning with the first day on which such operation was commenced shall be the calendar quarter in which falls such first day. However, if passenger fare revenue from scheduled service described in paragraph (e) of this section was derived on less than 30 days during such calendar quarter from operation of such system, the test period for such system for such taxable period shall be the following calendar quarter.

(3) In the case of any person who commences operation of a transit system at any time in the last calendar quarter to which the tax imposed by section 4481 applies, such last calendar quarter shall be the test period for such transit system regardless of the number of days

in which passenger fare revenue is derived in such calendar quarter.

(d) "Transit system." The term "transit system", as used in the regulations in this part, means any system for furnishing scheduled common carrier public passenger land transportation service along regular routes.

(e) 60-percent passenger fare revenue test. For purposes of this section, a person engaged in the operation of a transit system meets the 60-percent passenger fare revenue test set forth in section 6421 (b) (2), for the applicable test period prescribed in this section, if:

(1) During such test period (rather than any different period prescribed in section 6421 (b) (2)) such person derived passenger fare revenue from the operation of such system, and

(2) At least 60 percent of the total of such passenger fare revenue derived by such person during such test period was attributable to (i) amounts paid for transportation which do not exceed 60 cents, (ii) amounts paid for commutation or season tickets for single trips of less than 30 miles, or (iii) amounts paid for commutation tickets for one month or less (see section 4263(a)).

In determining the total of such passenger fare revenue, the tax imposed by section 4261 is not to be taken into account for that purpose, nor is revenue from such sources as charter fees, rentals of property, advertising receipts, etc., to be included for that purpose.

(f) Examples. Application of this section may be illustrated by the following examples:

Example (1). The X Transit Company is engaged in the operation of a transit system in the city of A and surrounding area throughout April, May, and June of 1962 and the taxable period beginning July 1, 1962. It derives passenger fare revenue from the operation of such system for 15 days in April and for the entire months of May and June of 1962. On July 1, 1962, the Company is using 60 buses of the transit type and 40 buses of the intercity type. Each of 20 of the transit-type buses and each of 10 of the intercity-type buses has a taxable gross weight of more than 26,000 pounds. (No tax is imposed on the use of either a transit-type bus or an intercity-type bus having a taxable gross weight of 26,000 pounds or less. See § 41.4481-1.) Use of the 10 intercitytype buses is subject to the tax for the taxable period beginning with July 1, 1962, since the exemption, if any, applies only to transittype buses. Use of the 20 transit-type buses is not subject to the tax for such taxable period if at least 60 percent of the total pas

senger fare revenue (not including any tax on the transportation of persons imposed by section 4261) derived by the X Transit Company during April, May, and June of 1962 (the test period prescribed in paragraph (c) (1) of this section) from operation of such system was from fares attributable to (i) amounts paid for transportation which do not exceed 60 cents, (ii) amounts paid for commutation or season tickets for single trips of less than 30 miles, or (iii) amounts paid for commutation tickets for one month or less. If the X Transit Company does not meet the 60-percent passenger fare revenue test for April, May, and June of 1962, the tax attaches for the taxable period beginning with July 1, 1962, with respect to the use of each of the 20 transit-type buses having a taxable gross weight of more than 26,000 pounds.

Example (2). Assume the same facts as those stated in Example (1), except that the X Transit Company commences operation of the transit system on July 15, 1962, and derives passenger fare revenue from operation of the system throughout the following August and September. In such case, the test period is July, August, and September of 1962, and if the test is met for this period, no tax is imposed on the use by the Company of any bus of the transit type in the period July 15, 1962, through June 30, 1963.

Example (3). Assume the same facts as those stated in Example (1), except that the X Transit Company commences operation of the transit system on April 15, 1963, and derives passenger fare revenue from operation of the system throughout the following May and June. In such case the test period is April, May, and June of 1963, and if the test is met for this period, no tax is imposed on the use by the Company of any bus of the transit type in the period April 15 through June of 1963, or in the taxable period beginning on July 1, 1963.

[T.D. 6216, 21 F.R. 9645, Dec. 6, 1956, as amended by T.D. 6743, 29 F.R. 7931, June 23, 1964]

§ 41.4483-3 Application of exemptions.

Any exemption from the tax on the use of a highway motor vehicle has application only with respect to the use of such highway motor vehicle and not with respect to the highway motor vehicle as such. Furthermore, such exemption is subject to those provisions of paragraph (c) of § 41.4481-1 relating to proration of the tax and to the effect of an exempt use of a highway motor vehicle after a taxable use has been made. Thus, if a taxable use is made of a highway motor vehicle at any time in a taxable period, the tax is imposed on the use of such vehicle for such taxable period, computed from the first day of the month in which such taxable use occurred, even

though at some time in the same taxable period, before or after such taxable use occurred, the use of the vehicle may have been, or may be, exempt. For example, if a highway motor vehicle is operated exclusively by a State in the period July 1 through September 10 of a taxable period, use of such vehicle in such period is exempt from the tax. However, if a taxable use of the vehicle is made on September 11 of such taxable period, the tax imposed on the use of such vehicle for such taxable period is computed from September 1. On the other hand, if a taxable use of the vehicle is made at any time in July of the taxable period, the tax imposed on the use of such vehicle for such taxable period is computed from July 1, even though the vehicle may be operated exclusively by a State in every other month of such period.

[T.D. 6743, 29 F.R. 7931, June 23, 1964] § 41.4484 Statutory provisions;

reference.

cross

SEC. 4484. Cross reference. For penalties and administrative provisions applicable to this subchapter, see subtitle F.

[Sec. 4484 as added by sec. 206 (a), Highway Revenue Act 1956]

§ 41.4484-1 Administrative provisions.

For administrative provisions relating to the tax on the use of certain highway motor vehicles, see Subpart C of this part and the applicable sections of the regulations on procedure and administration (Part 301 of this chapter). Subpart C-Administrative Provisions

of Special Application to Tax On Use of Certain Highway Motor Vehicles

§ 41.6001 Statutory provisions; notice or regulations requiring records, statements, and special returns.

SEC. 6001. Notice or regulations requiring records, statements, and special returns. Every person liable for any tax imposed by this title, or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary or his delegate may from time to time prescribe. Whenever in the judgment of the Secretary or his delegate it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns, render such statements, or keep such records, as the Secretary or his delegate deems sufficient to show whether or not such person is liable for tax under this title.

§ 41.6001-1 Records.

(a) Records to be kept. Every person in whose name any highway motor vehicle having a taxable gross weight in excess of 26,000 pounds (see the schedule of taxable gross weights prescribed by 41.4482(b)-1) is registered at any time in the taxable period shall keep records sufficient to enable the district director to determine whether such person is liable for the tax and, if so, the amount thereof. Such records shall show with respect to each such vehicle:

(1) A description of the vehicle (including serial number or other manufacturer's number) in sufficient detail to permit positive identification of the vehicle and of the category of the schedule of taxable gross weights in which such vehicle falls.

(2) In the case of any such vehicle acquired after June 30, 1956, the date on which such person acquired such vehicle and the name and address of the person from whom the vehicle was acquired.

(3) The first month of each taxable period in which occurred a taxable use of each such vehicle while the vehicle was registered in the name of such person; information showing whether such vehicle was operated, while registered in the name of such person, in any prior month in such taxable period; and if such vehicle was so operated, evidence establishing that such operation was not a taxable use.

(4) The date of sale or other transfer to another of any such vehicle, together with the name and address of the person to whom transferred.

(5) In the case of any such vehicle disposed of otherwise than by sale or other transfer, the date and method of disposition of the vehicle.

(6) In the case of a secondhand highway motor vehicle acquired at any time in the taxable period, evidence showing whether there was a prior taxable use in such taxable period of the highway motor vehicle (see paragraph (b) of § 41.44812). For filing requirements of purchaser of secondhand vehicle, see paragraph (b) of § 41.6011(a)-1.

(7) A copy of each return, schedule, statement, or other document filed, pursuant to the regulations in this part or in accordance with the instructions applicable to any form prescribed thereunder, by the person required to keep such records.

(b) Transit systems. Every person engaged in the operation of a transit sys

tem who claims exemption from tax with respect to a transit-type bus shall keep records sufficient to show, with respect to each taxable period, whether he meets the 60-percent passenger fare revenue test (see paragraph (e) of § 41.4483-2) for the period prescribed as the test period (see paragraph (c) of § 41.4483-2) for such system for such taxable period.

(c) Records of claimants. Any person claiming refund, credit, or abatement of the tax, interest, additional amount, addition to the tax, or assessable penalty, shall keep a complete and detailed record with respect to the claim.

(d) Place and period for keeping records. (1) All records required by the regulations in this part shall be kept, by the person required to keep them, at a convenient and safe location within the United States which is accessible to internal revenue officers. Such records shall at all times be available for inspection by such officers. If such person has a principal place of business in the United States, the records shall be kept at such place of business.

(2) Records required by paragraphs (a) and (b) of this section shall be maintained for a period of at least 3 years after the date the tax becomes due or the date the tax is paid, whichever is the later. Records required by paragraph (c) of this section (including any record required by paragraph (a) or (b) of this section which relates to a claim) shall be maintained for a period of at least 3 years after the date the claim is filed.

[T.D. 6216, 21 F.R. 9645, Dec. 6, 1956, as amended by T.D. 6743, 29 F.R. 7932, June 23, 1964]

§ 41.6011(a) Statutory provisions; general requirement of return, statement, or list; general rule.

SEC. 6011. General requirement of return, statement, or list-(a) General rule. When required by regulations prescribed by the Secretary or his delegate any person made liable for any tax imposed by this title, or for the collection thereof, shall make a return or statement according to the forms and regulations prescribed by the Secretary or his delegate. Every person required to make a return or statement shall include therein the information required by such forms or regulations.

a return of the tax on the use of such vehicle for such taxable period. Such return shall be made on Form 2290.

(b) Every person (other than a person required under paragraph (a) of this section to make a return) in whose name any highway motor vehicle is registered at a time during the taxable period when a taxable use of such vehicle occurs shall make a return of the tax on the use of such vehicle for such taxable period on Form 2290 if the district director notifies such person that such tax has not been paid in full. The amount to be reported as tax on such return with respect to the use of such vehicle shall be the unpaid portion of the tax on the use of such vehicle for such taxable period, measured from the first day of the month in which occurred the first taxable use of such vehicle in such taxable period. The district director shall advise such person of the amount of such unpaid tax. For provisions relating to the highway use tax liability for a taxable period of each person, where more than one person is liable for such tax, see § 41.4481-2. For provisions relating to the payment of tax in installments, see § 41.6156-1.

(c) Each return shall be made in accordance with the instructions and regulations applicable thereto.

[T.D. 6216, 21 F.R. 9645, Dec., 1956, as amended by T.D. 6743, 29 F.R. 7932, June 23, 1964]

§ 41.6071 (a) Statutory provisions; time for filing returns and other documents; general rule.

SEC. 6071. Time for filing returns and other documents-(a) General rule. When not otherwise provided for by this title, the Secretary or his delegate shall by regulations prescribe the time for filing any return, statement, or other document required by this title or by regulations.

§ 41.6071(a)-1 Time for filing returns. (a) Use after June 1956 and before July 1957. Except as otherwise provided in paragraph (c) of this section:

(1) In the case of any highway motor vehicle the first taxable use of which occurs after June 1956 and before December 1956, the person in whose name the vehicle is registered at the time of such use shall, after November 1956 and on or before January 31, 1957, make a return of the tax on the use of such vehicle for the taxable year ending June 30, 1957; and

(2) In the case of any highway motor vehicle the first taxable use of which occurs in a month after November 1956 and before July 1957, the person in whose name the vehicle is registered at the time of such use shall, after such month and on or before the last day of the following month, make a return of the tax on the use of such vehicle for the taxable year ending June 30, 1957.

(b) Use after June 1957. Except as otherwise provided in paragraph (c) of this section:

(1) In the case of any highway motor vehicle the first taxable use of which in any taxable period beginning on or after July 1, 1957, occurs in July of such taxable period, the person in whose name such vehicle is registered at the time of such use shall, after July and on or before August 31 of such taxable period, make a return of the tax on the use of such vehicle for such taxable period.

(2) In the case of any highway motor vehicle the first taxable use of which in any taxable period beginning on or after July 1, 1957, occurs in a month of such taxable period after July, the person in whose name the vehicle is registered at the time of such use shall, after such month and on or before the last day of the following month, make a return of the tax on the use of such vehicle for such taxable period.

of

(c) Certain transit-type buses. In the case of any bus of the transit type, the first taxable use of which in any taxable period occurs prior to the close of the test period (see paragraph (c) § 41.4483-2) with reference to which liability for the tax on the use of such transit-type bus for such taxable period is determined, the person in whose name the bus is registered at the time of such use shall, after such test period and on or before the last day of the following month (but in no event earlier than the time prescribed in paragraph (a)(1) of this section for filing a return) make a return of such tax for such taxable period on the use of such transit-type bus.

(d) Prior taxable use. Every person who, pursuant to paragraph (b)

of § 41.6011(a)-1, is required to make a return of the tax on the use of any highway motor vehicle for any taxable period shall make such return on or before the last day of the month following the month in which such person is notified by the district director that such return is required.

(e) Combined return. In the case of

any person who, pursuant to paragraph (a), (b), or (c) of this section, is required to report the tax on the use of two or more highway motor vehicles within a prescribed time after the close of a particular month, such person shall report the tax for the taxable period on the use of all such vehicles in a single return.

(f) Delinquent returns. For additions to the tax in case of failure to file return within prescribed time, see section 6651 and the regulations thereunder.

[T.D. 6216, 21 F.R. 9645, Dec. 6, 1956, as amended by T.D. 6743, 29 F.R. 7932, June 23, 1964]

District directors may, upon application of the taxpayer, grant a reasonable extension of time (not to exceed 60 days) in which to file the return. Application for an extension of time for filing the return should be addressed to the district director for the district in which the taxpayer files his returns and must contain a full recital of the causes for the delay. For extensions of time for payment of the tax, see § 41.6161 (a) (1)−1.

§ 41.6091 Statutory provisions; place for filing returns or other documents. SEC. 6091. Place for filing returns or other documents-(a) General rule. When not otherwise provided for by this title, the Secretary or his delegate shall by regulations prescribe the place for the filing of any return, declaration, statement, or other document, or copies thereof, required by this title or by regulations.

(b) Tax returns. In the case of returns of tax required under authority of part II of this subchapter

(1) Individuals. Returns (other than corporation returns) shall be made to the Secretary or his delegate in the internal revenue district in which is located the legal residence or principal place of business of the person making the return, or if he has no legal residence or principal place of business in any internal revenue district, then at such place as the Secretary or his delegate may by regulations prescribe.