Procedures and ATF/TTB procedures
re: nonbeverage drawback and S.D.A.
1) Only one procedure; Rev. Proc. 64-32; was published specifically for manufacturers of nonbeverage products (MNBPs) and it became obsolete in 1996 due to the recodification of the nonbeverage drawback regulations when it was replaced by the new supporting data form (ATF Form 5154.2) per Sec. 17.147.
2) Rev. Proc. 64-35 is listed below because it affected all operations under chapter 51 of the Internal Revenue Code and indicates how the ATF viewed data processing systems more than 40 years ago.
3) Rev. Proc. 71-22 and 72-20 are listed because they affect users of specially denatured spirits.
|Revenue Procedure 64-32 Drawback Claims - Format for Supporting Data OBSOLETE|
Revenue Procedure 64-35 Recordkeeping Using ADP Systems
Revenue Procedure 71-22 Protecting Water Quality
Revenue Procedure 72-20 Environmental Protection
Claims for MNBP Drawback
(Note: Forms listed as exhibits to this Revenue Procedure not reproduced here.)
SECTION 1. PURPOSE.
The purpose of this Revenue Procedure is to establish a standard format for use by manufacturers of nonbeverage products in furnishing the supporting data required by sections 197.110 through 197.119 of the Nonbeverage Drawback Regulations to support claims for drawback of tax on distilled spirits used in the manufacture of medicines, medicinal preparations, food products, flavors, and flavoring extracts, which are unfit for beverage purposes.
SECTION 2. FORMAT FOR SUPPORTING DATA.
.01 Manufacturers shall follow the format contained in accompanying Exhibits 1, 2, and 3 in furnishing to the Assistant Regional Commissioner, Alcohol and Tobacco Tax, the required data in support of claims for drawback, whether filed on a monthly or quarterly basis.
.02 The format for furnishing information as to the special tax stamp, required by section 197.111 of the regulations is provided in Part I of the supporting data. (See Exhibit 1.)
.03 The format for furnishing information as to distilled spirits received, required by section 197.112 through 197.114 of the regulations is provided in Part II of the supporting data. (See Exhibit 1.) Columns (a), (b), (c), (g), (h), and (i) are to be used for all distilled spirits received. Column (d) is to be used for distilled spirits received in tank cars, tank trucks, or portable containers. Column (e) is to be used for distilled spirits received in portable containers, if the containers bear serial numbers. Column (f), when covering spirits received in tank cars, tank trucks, or portable containers, will show the name of the producer, blender, or warehouseman, as applicable; when covering bottled spirits, it will show the name of the bottler. If the distilled spirits are received by pipeline, the Form 179, Withdrawal of Spirits Taxpaid (Revised 1964), release number shall be shown in column (c), since no stamp was issued.
.04 The format for furnishing information as to distilled spirits used, required by section 197.115 of the regulations is provided in Part III of the supporting data. (See Exhibit 2.) Part III is used to report information concerning uses of alcohol in eligible products which have been completed during the claim period. Columns (a), (b), (n), (o), and (p) shall be used whether new spirits, recovered spirits, intermediate products, or a combination thereof, was used in the finished products. Column (c), along with column (d), in the case of unrectified spirits, or columns (e) and (f), in the case of rectified spirits, shall be used to report new spirits used. Column (g) or (h), as applicable, shall be used to report the use of recovered spirits. Columns (i), (j), (k), (l), and/or (m), as appropriate, shall be used to report the use of finished products.
.05 The format for furnishing information required by section 197.116 through 197.118 of the regulations is provided in Part IV of the supporting data (See Exhibit 2.) Line 4, column (b), (c), or (d), shall be used for reporting items not reportable at line 1, 2, or 3, but which must be included in the total at line 5. Similarly, line 9, column (b), (c), or (d) shall be used for reporting items not reportable at line 6, 7, 8, 10, or 11, but which must be included in the total at line 12. For example, any gain disclosed by the closing inventory shall be reported at line 4, and any loss disclosed shall be reported at line 9. If line 4 or 9 is used, an appropriate identification of the entry should also be given to column (a). The quantity of distilled spirits used in products for export, on which drawback is not claimed under the Nonbeverage Drawback Regulations, shall be shown separately in column (b) at line 8.
.06 the format for furnishing the accounting for intermediate products, required by section 197.119, of the regulations is provided in Part V of the supporting data. (See Exhibit 3.) Lines 3 and 4 shall be used for reporting items not reportable at line 1 or 2 but which must be included in the total at line 5. Similarly, lines 9 and 10 shall be used for reporting items not reportable at line 6, 7, 8, or 11, but which must be included in the total at line 12. An appropriate identification of each such entry should be given in column (a).
.07 The name and address of the manufacturer shall be entered on each sheet of the supporting data. The first page shall show the complete postal address of the claimant. Succeeding pages may show only the city and state.
.08 The pages of the supporting data shall be numbered in sequence, beginning with "1," and the last page shall be signed by the claimant.
SEC. 3. MODIFICATION OF FORMAT.
The format as shown in Exhibit 1 through 3 is designed to permit entries for all types of operations by nonbeverage manufacturers. It is recognized that many manufacturers will not have need for all of the reporting facilities provided. Accordingly, when having forms prepared for his use, any nonbeverage drawback claimant whose operations do not require entries in all columns or parts of the format as shown in the exhibits may omit those which are inapplicable. In omitting columns, however, the columns which are not omitted should retain the letter designations as shown; for example, a claimant who does not use finished products containing spirits in the manufacture of a product on which drawback is claimed may omit columns (i) through (m) of Part III, but columns (n), (o), and (p) would not be redesignated. This procedure will simplify
identification of an item made the subject of correspondence or other communications.
SEC. 4. EFFECTIVE DATE.
The Revenue Procedure is effective immediately. However, to allow claimants time to obtain a supply of forms based on the format prescribed herein, Assistant Regional Commissioners will, for a reasonable period of time, accept supporting data furnished on forms which were previously in use, provided such forms include entries for all of the information required by the regulations.
SEC. 5. INQUIRIES.
Inquires relating to this Revenue Procedure should refer to it number and be addressed to the office of the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.
26 U.S.C. 5132; 26 CFR 601.304
Rev. Proc. 64-35
SECTION 1. PURPOSE.
.01 The purpose of this Revenue Procedure is to set forth guidelines specifying the basic record requirements which the Internal Revenue Service considers to be essential where a proprietor or permittee operating under chapter 51 (Distilled Spirits, Wines and Beer) or chapter 52 (Tobacco, Cigars, Cigarettes, and Cigarette Papers and Tubes) of the Internal Revenue Code of 1954 maintains records within an automatic data processing (ADP) system. For the purpose of this Revenue Procedure, ADP systems include all accounting systems which process all or a part of the records, transactions, or other applicable data of a proprietor or permittee by other than manual methods.
.02 Because the technology of ADP is evolving rapidly, these guidelines are not intended to restrict the uses made by proprietors and permittees except where such uses would result in noncompliance with record keeping requirements of the regulations.
SEC. 2. BACKGROUND
The inherent nature of ADP is such that it may not be possible to trace transactions from source documents to end results, or to reconstruct a given account, unless the system is designed to provide audit trails. Under regulations issued under chapter 51 of the Code, it is necessary that records of transactions be such as will enable any Internal Revenue Service officer to verify and trace the production, receipt, storage, and disposition of distilled spirits, wine, and beer and certain other products made with or containing wine or distilled spirits and certain other products made with or containing wine or distilled spirits, and to ascertain whether there has been compliance with the law and regulations. Similarly, under regulations issued under chapter 52 of the Code, it is necessary that records of specified operations and transactions, and the auxiliary and supplemental records from which such records are compiled, be maintained by the proprietor or permittee and be made available for inspection by any Internal Revenue Service officer upon his request.
SEC. 3. OBJECTIVES.
Modern machine accounting systems are capable of recording business transactions much more rapidly and with greater accuracy than manual systems, and they are capable of retaining and producing vast amounts of data. The ability to produce in legible form, when needed, the data necessary to meet the requirements of law and regulations must be carefully considered in designing and programming a machine system. This factor may add to the complexity or the systems and require additional cost, but this cost may be negligible when compared to the expense that may later be incurred if the systems cannot practically and readily provide the required information.
SEC. 4. ADP RECORD GUIDELINES.
.01 ADP accounting systems will vary, just as manual systems vary, to meet the needs of a particular proprietor or permittee. However, the procedures built into a computer's accounting program must include a method of producing from the punched cards or tapes visible and legible records which will provide the necessary details required by the regulations covering the respective operations, or such details must be available in supplemental records.
.02 In determining the adequacy of records required by regulations issued under chapter 51 and chapter 52, of the Code, maintained within an automatic data processing system, the Service will consider as acceptable those systems which comply with guidelines for records requirements as follows:
(1) The records maintained by ADP must be supplemented by such other records as are necessary, so that the entire records systems will fully comply with the requirements of the applicable regulations.
(2) The records must provide the opportunity to trace any transaction back to the original source or forward to a final total. If printouts are not made of transactions at the time they are processed, the system must have the ability to reconstruct these transactions.
(3) The system must be such that the information required by the regulations can be readily furnished without delay.
(4) Adequate record retention facilities must be available for storing tapes and printouts as well as all applicable supporting documents. These records must be retained in accordance with the provisions of the Code and the regulations prescribed thereunder.
(5) A description of the ADP portion of the accounting system should be available. The statements and illustrations as to the scope of operations should be sufficiently detailed to indicate (a) the application being performed, (b) the procedures employed in each application (which, for example, might be supported by flow charts, block diagrams, or other descriptions of input or output procedures), and (c) the controls used to insure accurate and reliable processing. Once an ADP system is installed, important changes, together with their effective dates, should be noted in order to preserve an accurate chronological record.
SEC. 5. NOTIFICATION TO ASSISTANT REGIONAL COMMISSIONER.
As indicated in section 3, inadequate coverage at the time an ADP system is installed can prove costly. Therefore, proprietors and permittees are encouraged to notify the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax, in advance of installation of ADP, giving him the details of the records involved and the proposed method of preparation and retention so that he can, to the extent possible, determine in advance the adequacy of the records.
SEC. 6. INQUIRIES
Comments or inquiries relating to this Revenue Procedure should be addressed to the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.
26 U.S.C. 5555, 5741; 26 CFR 601.301
Rev. Proc. 71-22
SECTION 1. PURPOSE.
The purpose of this Revenue Procedure is to prescribe procedures for obtaining information relating to water quality consideration as a part of applications for licenses or permits issued by Assistant Regional Commissioners, Alcohol, Tobacco and Firearms.
SEC. 2. BACKGROUND.
.01 Section 21(b)(1) of the Federal Water Pollution Control Act, as amended (33 U.S.C. 1171(b)), provides in effect that any applicant for a Federal license or permit (or any type of authorization which "permits" an operation under Internal Revenue laws) to conduct any activity which may result in any discharge into the navigable waters of the United States shall obtain a certification from the State in which the discharge originates that there is reasonable assurance that such activity will be conducted in a manner which will not violate applicable water quality standards.
.02 Regulations 18 CFR Part 615, State Certification of Activities Requiring A Federal License or Permit, (36 F.R. 8563) implementing section 21(b) of the Act provide that the licensing or permitting agency shall require that an applicant for a license or permit include in the form of the application, information relating to water quality considerations.
.03 The Alcohol, Tobacco and Firearms Division of the Internal Revenue Service has developed Form 4805, Supplemental Information on Water Quality Considerations Under 33 U.S.C. 1171(b), which is to be completed by the applicant and submitted with and as a part of his application for license or permit. The information provided for on the form will meet the requirements of section 21(b) of the Act and the regulations issued thereunder as to water quality considerations.
SEC. 3. OBTAINING FORMS 4805.
Form 4805 will be furnished each applicant by the Assistant Regional Commissioner, Alcohol, Tobacco and Firearms, along with the license or permit application form requested.
SEC. 4. FILING FORM 4805.
.01 The applicant will prepare an original and four copies of Form 4805 and submit all of them as an attachment to and as part of his application for a license or permit.
.02 Form 4805 will contain an authorization, to be signed by the applicant, that copies of the form may be furnished to the applicable State water quality agency and the Regional Administrator, EPA.
SEC. 5. INQUIRIES.
Inquiries regarding this Revenue Procedure should refer to its number and be addressed to the office of the appropriate Assistant Regional Commissioner, Alcohol, Tobacco and Firearms.
26 U.S.C. 5171, 5271, 5401, 5502, 5511; 26 CFR 601.301
Rev. Proc. 72-20
SECTION 1. PURPOSE.
This Revenue Procedure sets out procedures for furnishing environmental information concerning proposed activities for which applications, notices, bonds, and formulas (hereinafter referred to as applications) are filed with the Internal Revenue Service, Alcohol, Tobacco and Firearms Division.
SEC. 2. BACKGROUND.
.01 The National Environmental Policy Act of 1969 (NEPA), 83 Stat. 852, 42 U.S.C. 4321, established national policy, goals, and procedures for protecting and enhancing the environment. The Act applies to all Federal departments and agencies and requires an analysis of the environmental consequences of proposed major Federal actions which might have a significant effect on the environment.
.02 NEPA further requires that all Federal agencies prepare a detailed statement of the environmental impact for every major Federal action which the agency concludes could significantly affect the environment. The President's Council on Environmental Quality issued Guidelines which set forth procedures to be followed by Federal agencies in implementing NEPA. Within these Guidelines, projects and continuing activities involving Federal licenses, permits, leases, certificates or other entitlements for use such as those administered by the Alcohol, Tobacco and Firearms Division, have been determined to be in that category of major Federal actions that may require preparation of environmental statements.
.03 Regarding proposed activities for which licenses, permits, authorizations, rulings or approvals are required, the Service must, to fulfill its responsibilities under NEPA, have information concerning the environmental effect of the proposed activity to determine the need for preparation of environmental statements. Therefore, it will usually be necessary for applicants to submit this information.
SEC. 3. ACTIONS WHICH MAY REQUIRE ENVIRONMENTAL STATEMENTS.
.01 Internal Revenue Service actions which may have a significant adverse effect on the environment and therefore require preparation of environmental statements include, but are not limited to, the following Alcohol, Tobacco and Firearms actions:
1. The issuance of licenses and permits, including:
a. Permits under Chapter 51 (other than withdrawal permits) and permits under Chapter 52, I.R.C.
b. Permits under Section 4 of the Federal Alcohol Administration Act (27 U.S.C. 204).
c. Licenses under Chapters 40 and 44 of title 18 U.S.C.
2. The approval of authorizations which "permit" the operation of an activity under Internal Revenue laws, including but not limited to:
a. Form 27-C, Brewer's Notice.
b. Form 27-F, Registration of Vinegar Plant.
c. Form 27-G, Registration of Volatile Fruit-Flavor Concentrate Plant.
d. Form 1676, Bond Covering Removal to an Use of Wine at Vinegar Plant.
e. Form 2102, Bond-Manufacturer of Cigarette Papers and Tubes.
f. Form 4328, Notice of Intent to Manufacture Liquor Bottles, and Assignment of Manufacturer's Number.
g. Letter applications for operation of experimental or pilot plants.
3. The approval of special applications and formulas, and issuance of letter rulings, by the Alcohol, Tobacco and Firearms National or Regional Offices. This would not, however, include "notices" submitted if approval by ATF is not required for the operation covered by the notice.
4. Any further action by the Service after the original issuance or approval under 1, 2 or 3 above, such as renewal, amendment, or reissuance.
.02 If the activities contemplated under 3.01 above would have a significant adverse effect on the environment as a consequence of the Service's action, the Service is required to prepare an environmental impact statement. A proposed activity would be considered to significantly affect the environment when it would, for example:
1. Lead to a noticeable change in the ambient noise level for a substantial number of people, or significantly contribute to congestion.
2. Divide or disrupt an established community as to its physical, social, historical, cultural, or natural aspects.
3. Have a significant adverse aesthetic or visual effect.
4. Destroy or derogate from important recreational areas, places of unique interest or scenic beauty.
5. Substantially alter the pattern of behavior of a nonhuman species.
6. Interfere with important breeding, nesting, or feeding grounds.
7. Lead to a significant increase in air or water pollution in a given area.
8. Disturb the ecological balance of a land or water area.
9. Involve a reasonable possibility of contamination of a public water supply source, treatment facility, or distribution system.
SEC. 4. REQUIREMENT FOR FORM 4871.
Persons filing applications, notices, registrations, or bonds for licenses, permits, or authorizations, such as those listed under items 1 and 2 of 3.01 above, should furnish environmental information with their applications by attaching an original and one copy of Form 4871, Environmental Information. When specifically requested by the Assistant Regional Commissioner, Alcohol, Tobacco and Firearms, or the Director, Alcohol, Tobacco and Firearms Division, persons filing special applications, requests for rulings, or formulas, as covered in items 3 and 4 of 3.01 above, should also prepare and submit Form 4871 in original and one copy. In most instances, and applicant for special authorization or ruling can avoid unnecessary delay and preparation of Form 4871 if a request adequately described any effect on the environment of the proposed activity.
SEC. 5. ACTION WHEN ENVIRONMENTAL STATEMENT IS REQUIRED.
If the Assistant Regional Commissioner, Alcohol, Tobacco and Firearms, or the Director, Alcohol, Tobacco and Firearms Division, determines that a proposed activity would significantly affect the environment, he is required by NEPA to prepare an environmental impact statement. The responsible official will request applicants to furnish any additional information regarding the environmental effects of the proposed activity necessary for preparation of the environmental statement. The statement will be prepared, circulated, and made available to the public in accordance with the Guidelines of the Council on Environmental Quality.
SEC. 6. TIMELY FILING OF ENVIRONMENTAL INFORMATION.
It is extremely important that applications, Forms 4871, and any other necessary environmental information be submitted by the applicant as early as possible. The Service is required by NEPA to consider the environmental effects of a proposed action prior to issuance of any license, permit, authorization or other entitlement. If an environmental statement is necessary the time required for preparation, circulation, and public notice may cause considerable delay in final action on the application. The minimum time between receipt of application and final action after statements are prepared will be about 120 days, and longer periods should usually be expected.
SEC. 7. INQUIRIES.
Any inquiries regarding this Revenue Procedure should refer to its number and be addressed to the office of the appropriate Assistant Regional Commissioner, Alcohol, Tobacco and Firearms.
18 U.S.C. 843, 923; 26 U.S.C. 5008, 5703; 27 U.S.C. 204; 26 CFR 601.301