Accordingly, it is held that for purposes of the retailers excise tax, sales made under the kind of contract described above are sales under a chattel mortgage arrangement within the meaning of section 4053 (a) (4) of the Code, and the tax attributable to such sales shall be computed and paid in accordance with that section. SECTION 4061.-IMPOSITION OF TAX Rev. Rul. 59-11 Certain kits, known as "prefabricated truck body frames," from which truck bodies may be constructed by assembling the frame components and adding certain materials, are considered to be automobile parts or accessories, and the sales of such kits are subject to the manufacturers excise tax imposed by section 4061 (b) of the Internal Revenue Code of 1954. The person who purchases such kits and produces truck bodies by adding panels, floors, etc., is considered to be the manufacturer of complete truck bodies and is liable for the manufacturers excise tax imposed by section 4061 (a)(1) of the Code on his sales or use of the complete bodies. Advice has been requested concerning the applicability of the manufacturers excise tax to sales of certain kits, known as "prefabricated truck body frames." These kits contain five prefabricated components; namely, a floor frame, two side frames, a front end frame, and a roof frame. The kits are sold to truck body builders who assemble them into body frames which are further manufactured by attaching panels, laying the floors, adding roof materials, and finishing the trimmings to produce complete truck bodies. Section 4061 (b) of the Internal Revenue Code of 1954 imposes a tax upon sales by the manufacturer, producer, or importer of parts or accessories (with certain exceptions not here material) for any of the articles enumerated in section 4061 (a) of the Code. Automobile truck bodies are among the articles enumerated in section 4061(a) of the Code. Section 316.55 of Regulations 46, made applicable to the 1954 Code by Treasury Decision 6091, C.B. 1954-2, 47, provides, in part, that the term "parts or accessories" for an automobile truck or other automobile chassis or body includes any article the primary use of which is to improve, repair, replace, or serve as a component part of such vehicle or article. Components such as those described above, the primary use of which is to serve as component parts of automobile truck bodies, are considered to be parts or accessories for such truck bodies. Therefore, it is held that the manufacturer's sale of the kit containing the prefabricated components, which may be assembled by the purchaser into a body frame, is subject to the tax on parts or accessories imposed by section 4061 (b) of the Code. However, under the provisions of section 4220 of the Code (Section 4221 (a) (1) as amended by the Excise Tax Technical Changes Act of 1958, Public Law 85-859) and the applicable regulations, these kits may be sold by the manufacturer tax-free to truck builders for use in manufacturing of truck bodies. It is further held that the person who purchases such kits and builds truck bodies by adding panels, floors, etc., is considered to be the manufacturer of the complete bodies and is liable for the manufacturers excise tax imposed by section 4061 (a) (1) of the Code on his sales or use of such complete bodies. SECTION 4286.-IMPOSITION OF TAX 26 CFR 42.4286: Statutory provisions; imposition of tax. T. D. 63421 TITLE 26-INTERNAL REVENUE, 1954.-CHAPTER I, SUBCHAPTER D, PART 42.FACILITIES AND SERVICES EXCISE TAXES Regulations under sections 4286 and 4287 of the Internal Revenue Code of 1954, as amended, relating to the tax on the use of safe deposit boxes. DEPARTMENT OF THE TREASURY, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, To Officers and Employees of the Internal Revenue Service and Others On October 18, 1958, notice of proposed rulemaking regarding the regulations under sections 4286 and 4287 of the Internal Revenue Code of 1954, as amended, relating to the facilities and services excise tax imposed on the use of safe deposit boxes was published in the Federal Register (23 F. R. 8067). No objection to the rules proposed having been received during the 30-day period prescribed in the notice, the regulations as so published are hereby adopted. PARAGRAPH 1. Section 42.0-3 of the Facilities and Services Excise Tax Regulations (26 CFR Part 42) is hereby amended by striking paragraph (f) and inserting in lieu thereof the following: (f) Subpart G.-The regulations in Subpart G of this part relate to amounts paid on or after January 1, 1955, for the use of safe deposit boxes. PAR 2. The following regulations are prescribed under subchapter D of chapter 33 of the Internal Revenue Code of 1954, as amended, relating to the tax on the use of safe deposit boxes: TABLE OF CONTENTS SUBPART G-SAFE DEPOSIT BOXES Sec. 42.4286 42.4286-1 42.4287 Statutory provisions; imposition of tax. Statutory provisions; definition of safe deposit box. 42.4287-1 Safe deposit box. AUTHORITY: §§ 42.4286 to 42.4287-1, incl., issued under sec. 7805, I. R. C. 1954; 68A Stat. 917; 26 U. S. C. 7805. 123 F. R. 9807. SUBPART G-SAFE DEPOSIT BOXES § 42.4286 STATUTORY PROVISIONS; IMPOSITION OF TAX. SEC. 4286. IMPOSITION OF TAX. There is hereby imposed a tax equivalent to 10 percent of the amount collected for the use of any safe deposit box. Such tax shall be paid by the person pay ing for the use of the safe deposit box. § 42.4286-1 IMPOSITION OF TAX.-(a) In general.-Section 4286 imposes a tax upon amounts collected for the use of safe deposit boxes. When during the term of the contract or agreement for the use of a safe deposit box, such use is relinquished and a new contract or agreement is made for the use of another safe deposit box, additional tax is due upon any further amount collected under the new contract or agreement. (b) Rate of tax.-Tax is imposed at the rate of 10 percent of the amount collected for the use of any safe deposit box. (c) Liability for tax.-The tax is payable by the person paying for the use of the safe deposit box. Every person receiving payments for the use of a safe deposit box is required under section 4291 to collect the tax from the person paying for such use, and must return and pay over the tax so collected in accordance with the applicable provisions of the regulations contained in Subpart I of this part. § 42.4287 STATUTORY PROVISIONS; DEFINITION OF SAFE DEPOSIT BOX. SEC. 4287. DEFINITION OF SAFE DEPOSIT BOX. For the purposes of section 4286, any vault, safe, box, or other receptacle, of not more than 40 cubic feet capacity, used for the safekeeping or storage of jewelry, plate, money, specie, bullion, stocks, bonds, securities, valuable papers of any kind, or other valuable personal property, shall be regarded as a safe deposit box. § 42.4287-1 SAFE DEPOSIT Box.-The term "safe deposit box" includes any vault, safe, box, or other receptacle of not more than 40 cubic feet capacity, such as is customarily leased by a bank, trust company, security dealer, investment company, or storage company, for the safekeeping or storage of jewelry, plate, money, specie, bullion, stocks, bonds, securities, important papers of any kind, or other forms of valuable personal property. The term includes each individual vault, safe, box, or other receptacle, of not more than 40 cubic feet capacity, even though it is leased as one of several adjacent safe deposit boxes with an aggregate capacity of more than 40 cubic feet, and regardless of whether such adjacent safe deposit boxes are enclosed within a vault, enclosure, compartment, etc., to which the lessee has sole access. However, the term "safe deposit box" does not include open space in a general storage vault. DANA LATHAM Commissioner of Internal Revenue. Approved December 17, 1958. NELSON P. ROSE Acting Secretary of the Treasury (Filed by the Division of the Federal Register on December 19, 1958, 8:51 a. m., and published in the issue of the Federal Register for December 20, 1958, 23 F. R. 9807.) SECTION 4321.-IMPOSITION OF TAX [SALES OR TRANSFERS OF CAPITAL STOCK AND SIMILAR INTERESTS] Whether a transfer agent is liable for the documentary stamp tax on transfers prior to the specific transfer he is requested to effect. See Rev. Rul. 59-3, below. SECTION 4331.-IMPOSITION OF TAX INDEBTEDNESS] Whether a transfer agent is liable for the documentary stamp tax on transfers prior to the specific transfer he is requested to effect. See Rev. Rul. 59-3, below. SECTION 4383.-LIABILITY FOR TAX [MISCELLANEOUS PROVISIONS APPLICABLE TO DOCUMENTARY STAMP TAXES] (Also Sections 4321, 4331.) Rev. Rul. 59-3 Liability for the documentary stamp taxes on the sale or transfer of securities is imposed on any of the parties to a transaction, including a transfer agent. Such agent, however, is not liable for the stamp tax incurred on any transfer of securities made prior to the one which he is requested to effect. If, in any case of a requested transfer, there is patent evidence of an error or mistake with respect to affixing of stamps in a prior transaction, the transfer agent may bring the matter to the attention of the responsible parties in order that appropriation action may be taken. Advice has been requested concerning the liability of a transfer agent for documentary stamp taxes with respect to transfers made prior to the specific transfer which the transfer agent is requested to effect of record. For example, dealer A sold 100 shares of X company stock to dealer B and neither party affixed the documentary stamps to the bill of sale or to the certificates. B sold the shares to C, a customer, and delivered the certificates to D, the transfer agent, accompanied by bills of sale with requisite stamps affixed to cover the sale from B to C, with instructions to register the shares in the name of C. The specific question is whether D, the transfer agent, is liable for the documentary stamp tax on the transfer of the stock from A to B. Section 4321 of the Internal Revenue Code of 1954 imposes a tax on each sale or transfer of shares or certificates of stock, or of rights to subscribe for or to receive such shares or certificates, issued by a corporation. Section 4331 of the Code imposes a tax on each sale or transfer of any certificates of indebtedness issued by a corporation. Section 4383 of the Code before it was redesignated as section 4384 by the Excise Tax Technical Changes Act of 1958, Public Law 85-859, provides that the documentary stamp tax shall be paid by any person who makes, signs, issues, or sells any of the documents and instruments subject to the tax, or for whose use or benefit the same are made, signed, issued or sold. Under the provisions of section 4383 of the Code, liability for the documentary stamp tax is imposed on any of the parties to the transaction, including a transfer agent. Therefore, a transfer agent may be held liable for the transfer tax incurred on any transfer which he may effect. However, such agent cannot be held liable for any tax incurred on a transfer to which he was not a party. Accordingly, it is held that a transfer agent is not liable for the stamp tax incurred on any transfer of securities made prior to the one he is requested to effect and to which he was not a party as transfer agent or otherwise. If, in any case of a requested transfer, there is patent evidence in the record of an error or mistake with respect to the affixing of stamps in a prior transaction, the transfer agent may, as part of his service, bring the matter to the attention of the responsible parties in order that appropriate action may be taken. SECTION 5703.-LIABILITY FOR TAX AND METHOD OF PAYMENT [TOBACCO, CIGARS, CIGARETTES, AND CIGARETTE PAPERS AND TUBES] 26 CFR 270.64: Liability for tax and method of payment. T. D. 63411 TITLE 26-INTERNAL REVENUE, 1954.—CHAPTER I, SUBCHAPTER E, PART 270.— CIGARS AND CIGARETTES-MANUFACTURERS, IMPORTERS, AND DEALERS Taxpayment of cigars imported in passengers' baggage and by mail. DEPARTMENT OF THE TREASURY, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington 25, D. C. To Officers and Employees of the Internal Revenue Service and Others Concerned. On August 2, 1958, a notice of proposed rulemaking with respect to regulations designated as Part 270 of Title 26 of the Code of Federal Regulations was published in the Federal Register (23 F. R. 5878). The purpose of the proposal was to require the payment to the Collector of Customs on the basis of a return, of any internal revenue tax due and payable on cigars imported in passengers' baggage, in excess of the quantity exempted from tax by law and customs regulations, or by mail where the value does not exceed $250, and such cigars are for the personal consumptions of the importer or for disposition as his bona fide gift. After consideration of all such relevant matter as was presented by interested persons regarding the rules proposed and after making editorial changes which relate merely to form and not to substance, the following amendments to regulations in 26 CFR Part 270 as last amended by Treasury Decision 6330 [I. R. B. 1958-46, 18], approved October 29, 1958, are hereby adopted: PARAGRAPH 1. Section 270.64 is amended by adding in the third sentence after the words "That a manufacturer or an importer of cigars" the words", except where such cigars are imported in passengers' baggage, or by mail where the value does not exceed $250, for the personal consumption of the importer or for disposition as his bona fide gift,". PAR. 2. Paragraph (a) of section 270.190 is amended to read as follows: 123 F. R. 9808. |