Internal Revenue Code:Sec. 5011. Income Tax Credit for Average Cost of Carrying Excise Tax.

From TaxAlmanac

Location in Internal Revenue Code

     TITLE 26 - INTERNAL REVENUE CODE
      Subtitle E - Alcohol, Tobacco, and Certain Other Excise Taxes
       CHAPTER 51 - DISTILLED SPIRITS, WINES, AND BEER
        Subchapter A - Gallonage and Occupational Taxes
         PART I - GALLONAGE TAXES
          Subpart A - Distilled Spirits
        

Statute

    Sec. 5011. Income Tax Credit for Average Cost of Carrying Excise Tax.

  (a) In General- For purposes of section 38, the amount of the distilled 
    spirits credit for any taxable year is the amount equal to the product 
    of--
    (1) in the case of--
      (A) any eligible wholesaler, the number of cases of bottled 
        distilled spirits--
        (i) which were bottled in the United States, and
        (ii) which are purchased by such wholesaler during the taxable 
          year directly from the bottler of such spirits, or
      (B) any person which is subject to section 5005 and which is not an 
        eligible wholesaler, the number of cases of bottled distilled 
        spirits which are stored in a warehouse operated by, or on behalf 
        of, a State or political subdivision thereof, or an agency of 
        either, on which title has not passed on an unconditional sale 
        basis, and
    (2) the average tax-financing cost per case for the most recent
      calendar year ending before the beginning of such taxable year.
  (b) Eligible Wholesaler- For purposes of this section, the term 
    `eligible wholesaler' means any person which holds a permit under 
    the Federal Alcohol Administration Act as a wholesaler of distilled 
    spirits which is not a State or political subdivision thereof, or an 
    agency of either.
  (c) Average Tax-Financing Cost- 
    (1) IN GENERAL- For purposes of this section, the average tax-
      financing cost per case for any calendar year is the amount of
      interest which would accrue at the deemed financing rate during a 
      60-day period on an amount equal to the deemed Federal excise tax 
      per case.
    (2) DEEMED FINANCING RATE- For purposes of paragraph (1), the deemed 
      financing rate for any calendar year is the average of the corporate 
      overpayment rates under paragraph (1) of section 6621(a) (determined 
      without regard to the last sentence of such paragraph) for calendar 
      quarters of such year.
    (3) DEEMED FEDERAL EXCISE TAX PER CASE- For purposes of paragraph (1), 
      the deemed Federal excise tax per case is $25.68.
  (d) Other Definitions and Special Rules- For purposes of this section--
    (1) CASE- The term `case' means 12 80-proof 750-milliliter bottles.
    (2) NUMBER OF CASES IN LOT- The number of cases in any lot of 
      distilled spirits shall be determined by dividing the number of 
      liters in such lot by 9.

   

Sources

   
     Public Law 109-059 of 2005 amended Subpart A of part I
     of subchapter A of chapter 51 (relating to gallonage and occupational 
     taxes) by adding at the end this new section 5011.  Effective Date- 
     The amendments made by this section shall apply to taxable years 
     beginning after September 30, 2005.
        

Miscellaneous