27 C.F.R. Subpart G—Puerto Rican Tobacco Products and Cigarette Papers and Tubes, Brought Into the United States
Title 27 - Alcohol, Tobacco Products and Firearms
(a) Tobacco products and cigarette papers and tubes manufactured in Puerto Rico which are brought into the United States and withdrawn for consumption or sale are subject to the tax imposed by 26 U.S.C. 7652(a), at the rates set forth in 26 U.S.C. 5701. (b) The excise taxes collected on tobacco products and cigarette papers and tubes manufactured in Puerto Rico are covered into the Treasury of Puerto Rico. Tobacco products and cigarette papers and tubes are considered as manufactured in Puerto Rico for purposes of 26 U.S.C. 7652(a)(3) if the sum of the cost or value of the materials produced in Puerto Rico, plus the direct costs of processing operations performed in Puerto Rico, equals or exceeds 50 percent of the value of the product when it is brought into the United States. (c) The excise tax on tobacco products and cigarette papers and tubes of Puerto Rican manufacture may be prepaid in Puerto Rico prior to shipment of such articles to the United States in accordance with §41.105. In the case of tobacco products such tax may be paid in Puerto Rico on the basis of a semi-monthly return in accordance with the applicable provisions of this subpart. (68A Stat. 907, as amended, 72 Stat. 1417, 1418, as amended (26 U.S.C. 7652, 5703, 5704)) [T.D. ATF–206, 50 FR 15888, Apr. 23, 1985, as amended by T.D. ATF–232, 51 FR 28085, Aug. 5, 1986; T.D. ATF–243, 52 FR 43194, Dec. 1, 1986; T.D. ATF–246, 52 FR 669, Jan. 8, 1987; T.D. ATF–422, 64 FR 71950, Dec. 22, 1999. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] To prepay, in Puerto Rico, the internal revenue tax imposed by 26 U.S.C. 7652(a), on tobacco products and cigarette paper and tubes of Puerto Rican manufacture which are to be shipped to the United States, the shipper must file, or cause to be filed, a tax return, TTB Form 5000.25, with full remittance of tax which will become due on such tobacco products and cigarette papers and tubes. [T.D. ATF–444, 66 FR 13850, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] (a) Shipments other than noncommercial mail shipment. The taxpayer will ensure that the tax has been prepaid on the tobacco products and cigarette papers and tubes in each shipment. The taxpayer will identify the tobacco products or cigarette papers or tubes on the bill of lading or similar record to accompany the shipment with the following information: (1) The marks and numbers on shipping containers; (2) The number of containers; (3) The kind of taxable article and the rate of tax, as specified by 41.30 through 41.35; (4) The number of small cigarettes, large cigarettes or small cigars to be shipped; (5) The number and total sale price of large cigars with a price of not more than $235.294 per thousand to be shipped; (6) The number of large cigars with a sale price of more than $235.294 per thousand to be shipped; (7) The pounds and ounces of chewing tobacco or snuff to be shipped; (8) The pounds and ounces of pipe tobacco or roll-your-own tobacco to be shipped; (9) The number of cigarette papers or tubes to be shipped; (10) The amount of the tax paid on such articles under the provisions of this subpart; and (11) The name and address of the consignee in the United States to whom such products are being shipped. The taxpayer will note such bills of lading or similar records to identify the particular TTB Form 5000.25 on which taxes have been prepaid. (b) Noncommercial mail shipments. Noncommercial mail shipments of tobacco products and cigarette papers and tubes to the United States are exempt from the provisions of paragraph (a) of this section, except that the taxpayer will provide a copy of the TTB Form 5000.25 upon request of an appropriate TTB officer. [T.D. ATF–444, 66 FR 13850, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
Title 27: Alcohol, Tobacco and Firearms
PART 41—IMPORTATION OF TOBACCO PRODUCTS AND CIGARETTE PAPERS AND TUBES
Subpart G—Puerto Rican Tobacco Products and Cigarette Papers and Tubes, Brought Into the United States
§ 41.101 General.
Prepayment of Tax in Puerto Rico on Tobacco products and Cigarette Papers and Tubes
§ 41.105 Prepayment of tax.
§ 41.106 Examination and record of shipment by taxpayer.
§§ 41.107-41.108 [Reserved]
Deferred Payment of Tax in Puerto Rico on Tobacco Products
§ 41.109 Bond required for deferred taxpayment.
Where a manufacturer of tobacco products in Puerto Rico desires to defer payment in Puerto Rico of the internal revenue tax imposed by 26 U.S.C. 7652(a), on tobacco products of Puerto Rican manufacture coming into the United States, he shall file a bond, Form 2986, with the appropriate TTB officer, in accordance with the provisions of this subpart. Such bond shall be conditioned on the payment, at the time and in the manner prescribed in this subpart, of the full amount of tax computed under the provisions of this subpart with respect to tobacco products which are released for shipment to the United States on computation of tax. All taxes which are computed under the provisions of this subpart shall be chargeable against the bond, until such taxes are paid, as provided in §41.112. The bond shall show the location of the factory from which the tobacco products to which it relates are to be shipped.
[T.D. 6871, 31 FR 43, Jan. 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–48, 44 FR 55855, Sept. 28, 1979; T.D. ATF–232, 51 FR 28085, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–251, 52 FR 19340, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.110 Record of tax computation and shipment by bonded manufacturer under deferred taxpayment.
Where tobacco products or cigarette papers or tubes are to be shipped to the United States involving deferred taxpayment, the bonded manufacturer must calculate the tax from the information contained in the bill of lading or a similar record. The bonded manufacturer will identify each shipment on such record with the following information:
(a) The marks and numbers on shipping containers;
(b) The number of containers;
(c) The kind of taxable article and the rate of tax as specified in 41.30 through 41.35;
(d) The number of small cigarettes, large cigarettes or small cigars to shipped;
(e) The number and total sale price of large cigars with a price of not more than $235.294 per thousand to be shipped;
(f) The number of large cigars with a sale price of more than $235.294 per thousand to be shipped;
(g) The pounds and ounces of chewing tobacco or snuff to be shipped;
(h) The pounds and ounces of pipe tobacco or roll-your-own tobacco to be shipped;
(i) The number of cigarette papers or tubes;
(j) The amount of the tax to be paid on such articles under the provisions of this subpart; and
(k) The name and address of the consignee in the United States to whom such products are being shipped. The date of completing such record will be treated as the date of computation of the tax. Tobacco products or cigarette papers or tubes may be shipped to the United States in accordance with the provisions of this section only after computation of the tax.
(Approved by the Office of Management and Budget under control number 1512–0560)[T.D. ATF–444, 66 FR 13851, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.111 Agreement to Pay Tax.
Upon shipment of tobacco products and cigarette papers or tubes the bonded manufacturer agrees:
(a) To pay the tax on the shipment;
(b) That there is no default in payment of tax chargeable against the manufacturer's bond on TTB Form 2986 (5210.12); and
(c) That the amount of the manufacturer's bond is sufficient or in the maximum penal sum to cover the tax due on the shipment.
[T.D. ATF–444, 66 FR 13851, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.112 Tax return.
The internal revenue taxes imposed by 26 U.S.C. 7652(a), with respect to tobacco products manufactured in Puerto Rico and shipped to the United States on computation of tax under the provisions of this subpart shall be paid on the basis of a semimonthly tax return. The bonded manufacturer of such products shall prepare TTB Form 5000.25 in duplicate, and file the original with the appropriate TTB officer, and maintain one copy for the file for each semimonthly return period. The bonded manufacturer shall execute the return, TTB Form 5000.25, under the penalties of perjury. He shall file a return for each return period at the time specified in §41.114, regardless of whether tax is due for that return period. However, where the appropriate TTB officer, grants specific authorization, the bonded manufacturer need not file a tax return during the term of such authorization for any period in which tax liability was not incurred under the provisions of this subpart.
(Approved by the Office of Management and Budget under control number 1512–0497)[T.D. ATF–40, 42 FR 5006, Jan. 26, 1977, as amended by T.D. ATF–125, 48 FR 2123, Jan. 18, 1983; T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–251, 52 FR 19340, May 22, 1987; T.D. ATF–277, 53 FR 45269, Nov. 9, 1988. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.113 Return periods.
Except as provided by §41.114, the periods to be covered in the semimonthly tax returns shall be from the 1st day through the 15th day of each month, and from the 16th day through the last day of each month.
[T.D. ATF–365, 60 FR 33675, June 28, 1995. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.114 Time for filing.
(a) General rule. Semimonthly tax returns under this subpart shall be filed by the bonded manufacturer, for each return period, not later than the 14th day after the last day of the return period, except as provided by paragraph (b) of this section. The tax shall be paid in full by remittance at the time the return is filed as prescribed in §41.115 or §41.115a.
(b) Special rule for taxes due for the month of September (effective after December 31, 1994). (1) The second semimonthly period for the month of September shall be divided into two payment periods, from the 16th day through the 26th day, and from the 27th day through the 30th day. The bonded manufacturer shall file a return on Form 5000.25, and make remittance, for the period September 16–26, no later than September 29. The bonded manufacturer shall file a return on Form 5000.25, and make remittance, for the period September 27–30, no later than October 14.
(2) Taxpayment not by electronic fund transfer. In the case of taxes not required to be remitted by electronic fund transfer as prescribed by §41.115a, the second semimonthly period of September shall be divided into two payment periods, from the 16th day through the 25th day, and the 26th day through the 30th day. The bonded manufacturer shall file a return on Form 5000.25, and make remittance, for the period September 16–25, no later than September 28. The bonded manufacturer shall file a return on Form 5000.25, and make remittance, for the period September 26–30, no later than October 14.
(3) Amount of payment: Safe harbor rule. (i) Taxpayers are considered to have met the requirements of paragraph (b)(1) of this section, if the amount paid no later than September 29 is not less than 11/15 (73.3 percent) of the tax liability incurred for the semimonthly period beginning on September 1 and ending on September 15, and if any underpayment of tax is paid by October 14.
(ii) Taxpayers are considered to have met the requirements of paragraph (b)(2) of this section, if the amount paid no later than September 28 is not less than 2/3rds (66.7 percent) of the tax liability incurred for the semimonthly period beginning on September 1 and ending on September 15, and if any underpayment of tax is paid by October 14.
(4) Last day for payment. If the required due date for taxpayment for the periods September 16–25 or September 16–26 as applicable, falls on a Saturday or legal holiday, the return and remittance shall be due on the immediately preceding day. If the required due date falls on a Sunday, the return and remittance shall be due on the immediately following day.
(c) Postmark. If the return, and remittance as the case may be, are delivered by U.S. Mail to the appropriate TTB officer, the date of the official postmark of the U.S. Postal Service stamped on the cover in which the return, and remittance as the case may be, were mailed shall be treated as the date of delivery.
(d) Weekends and holidays. Except as provided in paragraph (b)(4) of this section, if the due date falls on a Saturday, Sunday, or legal holiday, the return and remittance shall be due on the immediately preceding day which is not a Saturday, Sunday, or legal holiday.
(Approved by the Office of Management and Budget under control number 1512–0467)[T.D. ATF–246, 52 FR 669, Jan. 8, 1987, as amended by T.D. ATF–251, 52 FR 19340, May 22, 1987; T.D. ATF–365, 60 FR 33675, June 28, 1995; T.D. ATF–444, 66 FR 13851, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.114a Qualification for extended deferral.
Note: This section applies only to removals made before January 1, 1983.
(a) Bonded manufacturers with bonds executed before September 1, 1973. Bonded manufacturers with bonds on Form 2936 executed before September 1, 1973, who desire to file returns under this subpart with benefit of the extended deferral permitted by §41.114 shall file with the appropriate TTB officer an extension of coverage of bond on Form 2105. Such extension of coverage shall identify the particular bond to which it applies and shall contain a statement of purpose as follows:
To continue in effect said bond (including all extensions or limitations of terms and conditions previously consented to and approved) notwithstanding that the time for payment of the tax may be deferred by the extended deferral period permitted by regulations in 27 CFR 41.114.
If the bond on Form 2986 is in an amount insufficient to cover an extended deferral period, according to the requirements of §41.121, the bonded manufacturer must either file a new bond or file a strengthening bond to increase the total amount of the bonds then in force to a sufficient amount.
(b) Bonded manufacturers with bonds executed after September 1, 1973. Bonded manufacturers operating under original or superseding bonds executed after September 1, 1973, are automatically qualified for the extended deferral permitted by §41.114 (unless found in default as provided in §41.116). Such bonds must be executed in an amount sufficient to cover an extended deferral period, according to the requirements of §41.121.
(c) Commencement of extended deferral. Bonded manufacturers may file returns with benefit of extended deferral only after the applicable bonds and extensions of coverage required by this section have been filed with and approved by the appropriate TTB officer.
(68A Stat. 847, as amended, 907, as amended; 26 U.S.C. 7101, 7652(a); 26 U.S.C. 7805)
[T.D. ATF–5, 38 FR 19688, July 23, 1973. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–48, 44 FR 55855, Sept. 28, 1979; T.D. ATF–125, 48 FR 2123, Jan. 18, 1983; T.D. ATF–251, 52 FR 19340, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.115 Remittance with return.
Remittance of the full amount of internal revenue tax computed during the return period shall accompany the return, except as prescribed in §41.115a. Such remittance may be in any form the appropriate TTB officer is authorized to accept under the provisions of §70.61 of this chapter (Payment by check or money order) and which is acceptable to that officer. In paying the tax, a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to one cent.
(Aug. 16, 1954, Ch. 736, 68A Stat. 778 (26 U.S.C. 6313) Aug. 16, 1954, ch. 736, 68A Stat. 775 (26 U.S.C. 6301); June 29, 1956, ch. 462, 70 Stat. 391 (26 U.S.C. 6301))
[26 FR 8195, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–48, 44 FR 55855, Sept. 28, 1979; T.D. ATF–77, 46 FR 3009, Jan. 13, 1981; T.D. ATF–251, 52 FR 19340, May 22, 1987; T.D. ATF–301, 55 FR 47658, Nov. 14, 1990. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.115a Payment of tax by electronic fund transfer.
(a) General. (1) Each taxpayer who was liable, during a calendar year, for a gross amount equal to or exceeding five million dollars in taxes on tobacco products, cigarette papers, and cigarette tubes combining tax liabilities incurred under this part and part 40 of this chapter, shall use a commercial bank in making payment by electronic fund transfer (EFT) of taxes on tobacco products, cigarette papers, and cigarette tubes during the succeeding calendar year. Payment of taxes on tobacco products, cigarette papers, and cigarette tubes by cash, check, or money order, as described in §41.115, is not authorized for a taxpayer who is required, by this section, to make remittances by EFT. For purposes of this section, the dollar amount of tax liability is defined as the gross tax liability of all taxes which are paid in accordance with this subpart, taxable withdrawals from premises in the United States, and importations during the calendar year, without regard to any drawbacks, credits, or refunds, for all premises from which such activities are conducted by the taxpayer. Overpayments are not taken into account in summarizing the gross tax liability.
(2) For the purposes of this section, a taxpayer includes a controlled group of corporations, as defined in 26 U.S.C. 1563, and implementing regulations in 26 CFR 1.1563–1 through 1.1563–4, except that the words “at least 80 percent” shall be replaced by the words “more than 50 percent” in each place it appears in subsection (a) of 26 U.S.C. 1563, as well as in the implementing regulations. Also, the rules for a “controlled group of corporations” apply in a similar fashion to groups which include partnerships and/or sole proprietorships. If one entity maintains more than 50% control over a group consisting of corporations and one, or more, partnerships and/or sole proprietorships, all of the members of the controlled group are one taxpayer for the purpose of determining who is required to make remittances by EFT.
(3) A taxpayer who is required by this section to make remittances by EFT, shall make a separate EFT remittance and file a separate tax return for each factory which tobacco products, or cigarette papers, or cigarette tubes are withdrawn upon determination of tax.
(b) Requirements. (1) On or before January 10 of each calendar year, except for a taxpayer already remitting the tax by EFT, each taxpayer who was liable for a gross amount equal to or exceeding five million dollars in taxes on tobacco products, cigarette papers, and cigarette tubes combining tax liabilities incurred under this part and part 40 of this chapter during the previous calender year, shall notify, in writing, the appropriate TTB officer. The notice shall be an agreement to make remittances by EFT.
(2) For each return filed in accordance with this part, the taxpayer shall direct the taxpayer's bank to make an electronic fund transfer in the amount of the taxpayment to the Treasury Account as provided in paragraph (e) of this section. The request shall be made to the bank early enough for the transfer to be made to the Treasury Account by no later than the close of business on the last day for filing the return, prescribed in §41.105 or §41.114. The request shall take into account any time limit established by the bank.
(3) If a taxpayer was liable for less than five million dollars in taxes on tobacco products, cigarette papers, and cigarette tubes during the preceding calendar year, the taxpayer may choose either to continue remitting the tax as provided in this section or to remit the tax with the return as prescribed by §41.115. On the first return on which the taxpayer chooses to discontinue remitting the tax by EFT and to begin remitting the tax with the tax return, the taxpayer shall notify the appropriate TTB officer by attaching a written notification to the tax return, stating that no taxes are due by EFT, because the tax liability during the preceding calendar year was less than five million dollars, and that the remittance shall be filed with the tax return.
(c) Remittance. (1) Each taxpayer shall show on the tax return, information about remitting the tax for that return by EFT and shall file the return with the appropriate TTB officer.
(2) Remittances shall be considered as made when the taxpayment by electronic fund transfer is received by the Treasury Account. For purposes of this section, a taxpayment by electronic fund transfer shall be considered as received by the Treasury Account when it is paid to a Federal Reserve Bank.
(3) When the taxpayer directs the bank to effect an electronic fund transfer message as required by paragraph (b)(2) of this section, any transfer data record furnished to the taxpayer, through normal banking procedures, will serve as the record of payment, and shall be retained as part of required records.
(d) Failure to make a taxpayment by EFT. The taxpayer is subject to a penalty imposed by 26 U.S.C. 5761, 6651, or 6656, as applicable, for failure to make a taxpayment by EFT on or before the close of business on the prescribed last day for filing.
(e) Procedure. Upon the notification required under paragraph (b)(1) of this section, the appropriate TTB officer will issue to the taxpayer an TTB Procedure entitled, Payment of Tax by Electronic Fund Transfer. This publication outlines the procedure a taxpayer is to follow when preparing returns and EFT remittances in accordance with this part.
(Approved by the Office of Management and Budget under Control Number 1512–0457)(Act of August 16, 1954, 68A Stat. 775, as amended (26 U.S.C. 6302); sec. 202, Pub. L. 85–859, 72 Stat. 1417, as amended (26 U.S.C. 5703))
[T.D. ATF–185, 49 FR 37583, Sept. 25, 1984, as amended by T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–245, 52 FR 534, Jan. 7, 1987; T.D. ATF–251, 52 FR 19340, May 22, 1987; T.D. ATF–262, 52 FR 47560, Dec. 15, 1987; T.D. ATF–277, 53 FR 45269, Nov. 9, 1988; T.D. ATF–384, 61 FR 54095, Oct. 17, 1996; T.D. ATF–422, 64 FR 71951, Dec. 22, 1999. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§ 41.116 Default.
Where a check or money order tendered with a semimonthly return for payment of internal revenue tax under the provisions of this subpart is not paid on presentment, where a bonded manufacturer fails to remit with the semimonthly return the full amount of tax due thereunder, or where a bonded manufacturer is otherwise in default in payment of tax under the provisions of this subpart, he shall not ship tobacco products to the United States on computation of tax, until the appropriate TTB officer finds that the revenue will not be jeopardized by deferred payment of tax under the provisions of this subpart.
[T.D. 6871, 31 FR 44, Jan 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–251, 52 FR 19340, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004]
§§ 41.117-41.118 [Reserved]
§ 41.119 Corporate surety.
(a) Surety bonds, required under the provisions of this subpart, may be given only with corporate sureties holding certificates of authority from the Secretary of the Treasury as acceptable sureties on Federal bonds. Limitations concerning corporate sureties are prescribed by the Secretary in the current revision of Treasury Department Circular No. 570 (Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as Acceptable Reinsuring Companies). The surety shall have no interest whatever in the business covered by the bond.
(b) Treasury Department Circular No. 570 is published in the
(July 30, 1947, ch. 390, 61 Stat. 648, as amended (6 U.S.C. 6, 7))
[T.D. ATF–92, 46 FR 46922, Sept. 23, 1981]
§ 41.120 Deposit of securities in lieu of corporate surety.
In lieu of corporate surety, the manufacturer of tobacco products in Puerto Rico may pledge and deposit, as security for his bond, securities which are transferrable and are guaranteed both as to interest and as to principal by the United States, in accordance with the provisions of 31 CFR part 225.
(61 Stat. 650; 6 U.S.C. 15)
[T.D. 6871, 31 FR 44, Jan. 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986]
§ 41.121 Amount and Account of bond.
(a) Bond amount. Except for the maximum and minimum amounts stated in this paragraph, the total amount of the bond or bonds for tobacco products or cigarette papers or tubes under the provisions of this subpart must be in an amount not less than the amount of unpaid tax chargeable at any one time against the bond. A manufacturer who will defer payment of tax for a shipment of tobacco products or cigarette papers or tubes under the provisions of this subpart must have sufficient credit in this account to cover the taxes prior to making the shipment to the United States. The maximum and minimum amounts of such bond or bonds are as follows:
------------------------------------------------------------------------ Bond amount Bond amount Taxable article maximum minimum------------------------------------------------------------------------(1) Cigarettes.......................... $250,000 $1,000(2) Any combination of taxable articles. 250,000 1,000(3) One kind of taxable article other 150,000 1,000 than cigarettes........................------------------------------------------------------------------------
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(b) Bond Account. Where the amount of a bonded manufacturer's bond is less than the maximum amount prescribed in paragraph (a) of this section, a bonded manufacturer must maintain an account reflecting all outstanding taxes with which the manufacturer's bond is chargeable. A manufacturer must debit such account with the amount of tax that was agreed to be paid under §41.111 or is otherwise chargeable against such bond and then must credit the account for the amount paid on Form 5000.25 or other TTB-prescribed document, at the time it is filed. (Approved by the Office of Management and Budget under control number 1512–0560)[T.D. ATF–444, 66 FR 13851, Mar. 8, 2001. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.122 Strengthening bond.Where the amount of any bond is no longer sufficient under the provisions of §41.121, the bonded manufacturer shall immediately file a strengthening bond in an appropriate amount with the same surety as that on the bond already in effect, unless a superseding bond is filed pursuant to §41.123. A strengthening bond will not be approved where any notation is made thereon which is intended, or which may be construed, as a release of any former bond, or as limiting the amount of either bond to less than its full amount. [26 FR 8195, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and further redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.123 Superseding bond.A bonded manufacturer shall immediately file a new bond to supersede his current bond when (a) the corporate surety on the current bond becomes insolvent, (b) the appropriate TTB officer approves a request from the surety on the current bond to terminate his liability under the bond, (c) the payment of any liability under a bond is made by the surety thereon, (d) the amount of the bond is no longer sufficient under the provisions of §41.121 and a strengthening bond has not been filed, or (e) the appropriate TTB officer considers a superseding bond necessary for the protection of the revenue. [26 FR 8195, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–251, 52 FR 19341, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.124 Extension of coverage of bond.An extension of coverage of the bond of a bonded manufacturer shall be required (a) as provided in §41.114a, and (b) in the case of any change in the location of the factory as set forth in the bond. Such extension of coverage of the bond shall be manifested on Form 2105 by the bonded manufacturer and by the surety on the bond with the same formality and proof of authority as required for the execution of the bond. [T.D. ATF–5, 38 FR 19689, July 23, 1973. Redesignated at 40 FR 16835, Apr. 15, 1975, and further redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.125 Approval of bond and extension of coverage of bond.The appropriate TTB officer is authorized to approve all bonds and extensions of coverage of bonds (except under §41.136) filed under this subpart. No manufacturer of tobacco products in Puerto Rico shall defer taxes under this subpart until he receives from the appropriate TTB officer notice of approval of the bond or of an appropriate extension of coverage of the bond required under this subpart. Upon receipt of the duplicate copy of an approved bond or extension of coverage of bond from the appropriate TTB officer, such copy of the bond or extension of coverage of bond shall be retained by the bonded manufacturer and shall be made available for inspection by the appropriate TTB officer upon his request. [T.D. 6871, 31 FR 45, Jan. 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–251, 52 FR 19341, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.126 Termination of bond.Any bond given under the provisions of this subpart may be terminated as to future transactions, by the appropriate TTB officer, (a) pursuant to application of surety as provided in §41.127; (b) on approval of a superseding bond; (c) on notification by the bonded manufacturer to the appropriate TTB officer that he has discontinued the deferral of taxes under the bond; or (d) on notification by the bonded manufacturer to the appropriate TTB officer that he has discontinued business. When any bond is terminated, the appropriate TTB officer shall notify both the bonded manufacturer and surety on such bond, in writing, of such action. [26 FR 8196, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–251, 52 FR 19341, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.127 Application of surety for relief from bond.A surety on any bond given under the provisions of this subpart may at any time in writing notify the bonded manufacturer and the appropriate TTB officer that he desires, after a date named, to be relieved of liability under said bond. Such date shall be not less than 10 days after the date the notice is received by the appropriate TTB officer. The surety shall also file with the appropriate TTB officer an acknowledgement or other proof of service on the bonded manufacturer. If such notice is not thereafter in writing withdrawn, the rights of the bonded manufacturer as supported by said bond shall be terminated on the date named in the notice, and the surety shall be relieved from liability to the extent set forth in §41.128. [26 FR 8196, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–251, 52 FR 19341, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.128 Relief of surety from bond.Where the surety on a bond given under the provisions of this subpart has filed application for relief from liability as provided in §41.127, the surety shall be relieved from liability for transactions occurring wholly subsequent to the date specified in the notice, or the effective date of a new bond, if one is given. [26 FR 8196, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and further redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] § 41.129 Release of pledged securities.Securities of the United States, pledged and deposited as provided in §41.120, shall be released only in accordance with the provisions of 31 CFR part 225. Such securities will not be released by the appropriate TTB officer until the liability under the bond for which they were pledged has been terminated. When the appropriate TTB officer is satisfied that they may be released, he shall fix the date or dates on which a part or all of such securities may be released. At any time prior to the release of such securities, the appropriate TTB officer may extend the date of release for such additional length of time as he deems necessary. (61 Stat. 650; 6 U.S.C. 15) [26 FR 8196, Aug. 31, 1961. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–251, 52 FR 19341, May 22, 1987. Redesignated and amended by T.D. TTB–16, 69 FR 52424, 52425, Aug. 26, 2004] §§ 41.135-41.138 [Reserved]§ 41.139 Records.Every manufacturer of tobacco products and cigarette papers and tubes in the United States who receives tobacco products or cigarette papers or tubes or Puerto Rican manufacture, without payment of internal revenue tax, under his bond, shall keep separate records of all items received, removed subject to tax, removed for tax-exempt purposes, and otherwise disposed of, showing the following information: (a) Date, quantity, kind of cigars, cigarettes, smokeless tobacco, pipe tobacco and roll-your-own tobacco (number of small cigars—large cigars; number of small cigarettes—large cigarettes; pounds and ounces of chewing tobacco—snuff; pounds and ounces of pipe tobacco—roll-your-own tobacco). (b) The sale price of large cigars removed subject to tax, except that if the price is more than $235.294 per thousand, it may be shown as if it were $236 per thousand. (c) Cigarette papers: (1) Before January 1, 2000, the date and number of books or sets of cigarette papers of each numerical content. (2) On and after January 1, 2000, the date and number of cigarette papers. (d) The date and number of cigarette tubes. (Approved by the Office of Management and Budget under control number 1512–0362)(Sec. 2128(c), Pub. L. 94–455, 90 Stat. 1921 (26 U.S.C. 5741)) [T.D. ATF–80, 46 FR 18311, Mar. 24, 1981, as amended by T.D. ATF–172, 49 FR 14943, Apr. 16, 1984; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–289, 54 FR 48841, Nov. 27, 1989; T.D. ATF–307, 55 FR 52745, Dec. 21, 1990; T.D. ATF–424, 64 FR 71933, Dec. 22, 1999; T.D. ATF–420, 64 FR 71944, Dec. 22, 1999] § 41.140 Taxpayment in the United States.Every manufacturer of tobacco products or cigarette papers or tubes in the United States who receives Puerto Rican tobacco products or cigarette papers or tubes without payment of internal revenue tax, under his bond, and subsequently removes such products, subject to tax, must pay the tax imposed on such products by 26 U.S.C. 7652(a), at the rates prescribed in 26 U.S.C. 5701, on the basis of a return under the provisions of part 40 of this chapter applicable to the taxpayment of tobacco products. Similarly, every manufacturer of cigarette papers and tubes in the United States who receives Puerto Rican cigarette papers and tubes and subsequently removes such articles, shall pay the tax imposed on such articles by 26 U.S.C. 7652(a), at the rates prescribed in 26 U.S.C. 5701, on the basis of a return under the provisions of part 40 of this chapter applicable to taxpayment of cigarette papers and tubes. Such tobacco products and cigarettes papers and tubes shall be separately listed and identified as articles of Puerto Rican manufacture on Form 5000.24. The amount of tax paid on such articles shall be separately stated on Form 5000.24. [T.D. 6871, 31 FR 45, Jan. 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975, and amended by T.D. ATF–48, 44 FR 55855, Sept. 28, 1979; T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–384, 61 FR 54095, Oct. 17, 1996; T.D. ATF–424, 64 FR 71933, Dec. 22, 1999; T.D. ATF–422, 64 FR 71951, Dec. 22, 1999] § 41.141 Reports.Every manufacturer of tobacco products or cigarette papers or tubes in the United States who receives Puerto Rican tobacco products, or cigarette papers or tubes without payment of internal revenue tax, under his bond, must report the receipt and disposition of such tobacco products and cigarette papers and tubes on supplemental monthly reports. Such supplemental reports shall be made on Form 5210.5 or Form 2138 and shall have inserted thereon the heading, “Cigars and Cigarettes of Puerto Rican Manufacture” or “Cigarette Papers and Tubes of Puerto Rican Manufacture,” as the case may be. The original of such supplemental report shall be attached to the manufacturer's regular monthly report when filed. (72 Stat. 1422; 26 U.S.C. 5722) [T.D. 6871, 31 FR 46, Jan. 4, 1966. Redesignated at 40 FR 16835, Apr. 15, 1975; T.D. ATF–232, 51 FR 28086, Aug. 5, 1986; T.D. ATF–243, 51 FR 43194, Dec. 1, 1986; T.D. ATF–424, 64 FR 71933, Dec. 22, 1999; T.D. ATF–422, 64 FR 71951, Dec. 22, 1999] Browse Previous | Browse Next
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