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Memo Provides Deviation for Air Transportation Excise Tax Claims

OCT. 19, 2020

WI-21-1020-0006

DATED OCT. 19, 2020
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Citations: WI-21-1020-0006

Expiration Date:October 19, 2022
Affected IRM:21.5.3

October 19, 2020

MEMORANDUM FOR DIRECTOR, EXAMINATION — CINCINNATI CAMPUS, DIRECTOR, SUBMISSION PROCESSING — OGDEN CAMPUS, DIRECTOR, EXAM CASE SELECTION, DIRECTOR, SPECIALTY EXAM, DIRECTOR, SPECIALTY EXAM POLICY

FROM:
Karen A. Michaels
Director, Accounts Management

SUBJECT:
Deviation for Selection and Payment Criteria for Air Transportation Excise Tax Claims for Quarter Ended June 30, 2020

Purpose: The purpose of this memorandum is to provide guidance to temporarily deviate from IRM 21.5.3.4.7.1 regarding criteria for exam selection and payment of air transportation excise tax claims for the quarter ended June 30, 2020. IRM 21.5.3.4.7.1 provides guidance on when claims for refund should be referred to the Centralized Specialty Tax Classification Team based on Category A (CAT-A) examination criteria. Guidance in this memorandum is designed to address unique operational circumstances of the COVID-19 pandemic and will not be incorporated into the IRM. Please ensure this information is distributed to all affected employees in your organization.

Background/Source(s) of Authority: Due to the combined effects of the use of the alternative method of depositing air transportation tax, COVID-19 air travel cancellations, and the air transportation excise tax holiday under the CARES Act, it is expected there will be an unprecedented number of air transportation tax claims for refund for the quarter ending June 30, 2020.

Procedural Change: In collaboration with Campus, Excise Exam, and Excise Case Selection, the selection and payment criteria below are being established to focus on those claims that are of the highest risk of noncompliance while considering resource limitations.

The following criteria should be considered for classification and payment determination of air transportation excise tax claims for refund applicable to Abstracts 026 and 027, and associated Credit Reference Numbers (CRNs) 326 and 327 on both Forms 8849 Schedule 6 and 720 Schedule C only:

In general, consideration should be given to accepting claims as filed, conditional on meeting all the following criteria:

1. Claim period must be for the quarter ended June 30, 2020 only — If the claim period is for a period other than the quarter ended June 30, 2020, or includes periods in addition to the quarter ended June 30, 2020, consideration should be given to selecting the claim for exam using standard selection criteria.

2. Form 720 for the quarter ended Dec, 31, 2019 was filed — If the claimant has not filed a Form 720 for the quarter ended December 31, 2019, reporting taxes for abstracts 026 and 027, consideration should be given to selecting the claim for exam using standard selection criteria.

3. * * *

* * *

4. * * *

5. Claim must be from a United States claimant — If the claim is from a non-U.S. air carrier, consideration should be given to selecting the claim for exam using standard selection criteria. Most foreign air carriers have a U.S. address, however, may be incorporated outside of the U.S. Any air carrier incorporated outside of the U.S. would be considered a foreign carrier, regardless of their mailing address or location of their Power of Attorney.

6. Claim must be from an air carrier — If the claimant is not an air carrier, consideration should be given to selecting the claim for exam using standard selection criteria.

7. * * *

* * *

If a claim for the quarter ended June 30, 2020 does not meet one or more of the above 7 criteria, consideration should be given to selecting the claim for exam using standard selection criteria outlined in IRM 21.5.3.4.7.1, without this supplemental guidance.

Classifiers are encouraged to seek managerial assistance in unique, conflicting, or undefined situations. Campus management should contact HQ Specialty Excise Case Selection on a weekly basis, who will coordinate conversations and decisions between Exam Case Selection, Excise Tax Policy, and the Campus. A written action-on-decision communication will be issued as necessary.

Effect on Other Documents: This guidance deviates from IRM 21.5.3; Account Resolution — General Claims Procedures. It will expire on October 19, 2022 but will be archived when no longer applicable.

Effective Date: This information in this memorandum is effective on October 19, 2020.

Contact: If there are any questions, please contact Tax Analyst, Jamie Luna.

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