26 U.S.C. § 4052 — Definitions and special rules

Page 2887 TITLE 26—INTERNAL REVENUE CODE § 4052 the parts or accessories shall be secondarily liable for the tax imposed by paragraph (1)’’ for ‘‘In addition to the owner, lessee, or operator of the vehicle, the owner of the trade or business installing the part or accessory shall be liable for the tax imposed by paragraph (1)’’. Subsecs. (d), (e). Pub. L. 98–369, § 921, added subsec. (d) and redesignated former subsec. (d) as (e). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2021 AMENDMENT Amendment by Pub. L. 117–58 effective Oct. 1, 2021, see section 80102(f) of Pub. L. 117–58, set out as a note under section 4041 of this title. EFFECTIVE DATE OF 2015 AMENDMENT Amendment by Pub. L. 114–94 effective Oct. 1, 2016, see section 31102(f) of Pub. L. 114–94, set out as a note under section 4041 of this title. EFFECTIVE AND TERMINATION DATES OF 2012 AMENDMENT Amendment by Pub. L. 112–141 effective July 1, 2012, see section 40102(f) of Pub. L. 112–141, set out as a note under section 4041 of this title. Amendment by Pub. L. 112–140 to cease to be effective on July 6, 2012, with text as amended by Pub. L. 112–140 to revert back to read as it did on the day before June 29, 2012, and amendments by Pub. L. 112–141 to be exe- cuted as if Pub. L. 112–140 had not been enacted, see section 1(c) of Pub. L. 112–140, set out as a note under section 101 of Title 23, Highways. Amendment by Pub. L. 112–140 effective July 1, 2012, see section 402(f)(1) of Pub. L. 112–140, set out as a note under section 4041 of this title. Amendment by Pub. L. 112–102 effective Apr. 1, 2012, see section 402(f) of Pub. L. 112–102, set out as a note under section 4041 of this title. EFFECTIVE DATE OF 2011 AMENDMENT Amendment by Pub. L. 112–30 effective Oct. 1, 2011, see section 142(f) of Pub. L. 112–30, set out as a note under section 4041 of this title. EFFECTIVE DATE OF 2005 AMENDMENT Pub. L. 109–59, title XI, § 11112(b), Aug. 10, 2005, 119 Stat. 1946, provided that: ‘‘The amendments made by this section [amending this section] shall apply to sales after September 30, 2005.’’ EFFECTIVE DATE OF 1997 AMENDMENT Pub. L. 105–34, title XIV, § 1401(b), Aug. 5, 1997, 111 Stat. 1046, provided that: ‘‘The amendments made by subsection (a) [amending this section and section 4003 of this title] shall apply to installations on vehicles sold after the date of the enactment of this Act [Aug. 5, 1997].’’ Pub. L. 105–34, title XIV, § 1402(c), Aug. 5, 1997, 111 Stat. 1046, provided that: ‘‘The amendments made by this section [amending this section and section 4052 of this title] shall take effect on January 1, 1998.’’ EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 1877(c) of Pub. L. 99–514 effec- tive, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98–369, div. A, title VII, § 736, July 18, 1984, 98 Stat. 985, provided that: ‘‘Except as otherwise provided in this subtitle [subtitle C (§§ 731–736) of title VII of div. A of Pub. L. 98–369, amending this section and sections 48, 1366, 4052, 4053, 4071 to 4073, 4081, 4082, 4216, 4218, 4221 to 4223, 4227, 4481, 6401, 6412, 6416, 6427, 6511, and 9502 of this title, repealing sections 4061 to 4063 of this title, and amending provisions set out as notes under sec- tions 4061 and 4081 of this title], any amendment made by this subtitle shall take effect as if included in the provisions of the Highway Revenue Act of 1982 [Pub. L. 97–424] to which such amendment relates.’’ EFFECTIVE DATE Pub. L. 97–424, title V, § 512(b)(3), Jan. 6, 1983, 96 Stat. 2177, provided that: ‘‘The amendments made by this subsection [enacting this subchapter and amending sec- tion 6416 of this title] shall take effect on April 1, 1983.’’ PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989 For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title. § 4052. Definitions and special rules (a) First retail sale For purposes of this subchapter— (1) In general The term ‘‘first retail sale’’ means the first sale, for a purpose other than for resale or leasing in a long-term lease, after production, manufacture, or importation. (2) Leases considered as sales Rules similar to the rules of section 4217 shall apply. (3) Use treated as sale (A) In general If any person uses an article taxable under section 4051 before the first retail sale of such article, then such person shall be liable for tax under section 4051 in the same man- ner as if such article were sold at retail by him. (B) Exemption for use in further manufac- ture Subparagraph (A) shall not apply to use of an article as material in the manufacture or production of, or as a component part of, an- other article to be manufactured or pro- duced by him. (C) Computation of tax In the case of any person made liable for tax by subparagraph (A), the tax shall be computed on the price at which similar arti- cles are sold at retail in the ordinary course of trade, as determined by the Secretary. (b) Determination of price (1) In general In determining price for purposes of this subchapter— (A) there shall be included any charge inci- dent to placing the article in condition ready for use, (B) there shall be excluded— (i) the amount of the tax imposed by this subchapter, (ii) if stated as a separate charge, the amount of any retail sales tax imposed by any State or political subdivision thereof Page 2888 TITLE 26—INTERNAL REVENUE CODE § 4052 or the District of Columbia, whether the liability for such tax is imposed on the vendor or vendee, and (iii) the value of any component of such article if— (I) such component is furnished by the first user of such article, and (II) such component has been used be- fore such furnishing, and (C) the price shall be determined without regard to any trade-in. (2) Sales not at arm’s length In the case of any article sold (otherwise than through an arm’s-length transaction) at less than the fair market price, the tax under this subchapter shall be computed on the price for which similar articles are sold at retail in the ordinary course of trade, as determined by the Secretary. (3) Long-term lease (A) In general In the case of any long-term lease of an ar- ticle which is treated as the first retail sale of such article, the tax under this sub- chapter shall be computed on a price equal to— (i) the sum of— (I) the price (determined under this subchapter but without regard to para- graph (4)) at which such article was sold to the lessor, and (II) the cost of any parts and acces- sories installed by the lessor on such ar- ticle before the first use by the lessee or leased in connection with such long-term lease, plus (ii) an amount equal to the presumed markup percentage of the sum described in clause (i). (B) Presumed markup percentage For purposes of subparagraph (A), the term ‘‘presumed markup percentage’’ means the average markup percentage of retailers of articles of the type involved, as determined by the Secretary. (C) Exceptions under regulations To the extent provided in regulations pre- scribed by the Secretary, subparagraph (A) shall not apply to specified types of leases where its application is not necessary to carry out the purposes of this subsection. (4) Special rule where tax paid by manufac- turer, producer, or importer (A) In general In any case where the manufacturer, pro- ducer, or importer of any article (or a re- lated person) is liable for tax imposed by this subchapter with respect to such article, the tax under this subchapter shall be com- puted on a price equal to the sum of— (i) the price which would (but for this paragraph) be determined under this sub- chapter, plus (ii) the product of the price referred to in clause (i) and the presumed markup per- centage determined under paragraph (3)(B). (B) Related person For purposes of this paragraph— (i) In general Except as provided in clause (ii), the term ‘‘related person’’ means any person who is a member of the same controlled group (within the meaning of section 5061(e)(3)) as the manufacturer, producer, or importer. (ii) Exception for retail establishment To the extent provided in regulations prescribed by the Secretary, a person shall not be treated as a related person with re- spect to the sale of any article if such arti- cle is sold through a permanent retail es- tablishment in the normal course of the trade or business of being a retailer. (c) Certain combinations not treated as manufac- ture (1) In general For purposes of this subchapter (other than subsection (a)(3)(B)), a person shall not be treated as engaged in the manufacture of any article by reason of merely combining such ar- ticle with any item listed in paragraph (2). (2) Items The items listed in this paragraph are any coupling device (including any fifth wheel), wrecker crane, loading and unloading equip- ment (including any crane, hoist, winch, or power liftgate), aerial ladder or tower, snow and ice control equipment, earthmoving, exca- vation and construction equipment, spreader, sleeper cab, cab shield, or wood or metal floor. (d) Certain other rules made applicable Under regulations prescribed by the Secretary, rules similar to the rules of subsections (c) and (d) of section 4216 (relating to partial payments) shall apply for purposes of this subchapter. (e) Long-term lease For purposes of this section, the term ‘‘long- term lease’’ means any lease with a term of 1 year or more. In determining a lease term for purposes of the preceding sentence, the rules of section 168(i)(3)(A) shall apply. (f) Certain repairs and modifications not treated as manufacture (1) In general An article described in section 4051(a)(1) shall not be treated as manufactured or pro- duced solely by reason of repairs or modifica- tions to the article (including any modifica- tion which changes the transportation func- tion of the article or restores a wrecked arti- cle to a functional condition) if the cost of such repairs and modifications does not exceed 75 percent of the retail price of a comparable new article. (2) Exception Paragraph (1) shall not apply if the article (as repaired or modified) would, if new, be tax- able under section 4051 and the article when new was not taxable under such section or the corresponding provision of prior law. (g) Regulations The Secretary shall prescribe regulations which permit, in lieu of any other certification, Page 2889 TITLE 26—INTERNAL REVENUE CODE § 4053 persons who are purchasing articles taxable under this subchapter for resale or leasing in a long-term lease to execute a statement (made under penalties of perjury) on the sale invoice that such sale is for resale. The Secretary shall not impose any registration requirement as a condition of using such procedure. (Added Pub. L. 97–424, title V, § 512(b)(1), Jan. 6, 1983, 96 Stat. 2175; amended Pub. L. 98–369, div. A, title VII, §§ 731, 735(b)(2), July 18, 1984, 98 Stat. 976, 981; Pub. L. 100–17, title V, §§ 505(a)–(c), 506(a), Apr. 2, 1987, 101 Stat. 258, 259; Pub. L. 100–647, title VI, § 6111(a), Nov. 10, 1988, 102 Stat. 3713; Pub. L. 105–34, title XIV, §§ 1402(b), 1434(a), (b), Aug. 5, 1997, 111 Stat. 1046, 1052; Pub. L. 105–206, title VI, § 6014(c), July 22, 1998, 112 Stat. 820.) Editorial Notes PRIOR PROVISIONS A prior section 4052, act Aug. 16, 1954, ch. 736, 68A Stat. 479, provided that lease of an article would be considered the sale of article for excise tax purposes, prior to repeal by Pub. L. 94–455, title XIX, § 1904(a)(1)(D), Oct. 4, 1976, 90 Stat. 1811. AMENDMENTS 1998—Subsec. (f)(2). Pub. L. 105–206 substituted ‘‘such section’’ for ‘‘this section’’. 1997—Subsec. (b)(1)(B)(ii) to (iv). Pub. L. 105–34, § 1402(b), inserted ‘‘and’’ at end of cl. (ii), redesignated cl. (iv) as (iii), and struck out former cl. (iii) which read as follows: ‘‘the fair market value (including any tax imposed by section 4071) at retail of any tires (not in- cluding any metal rim or rim base), and’’. Subsec. (d). Pub. L. 105–34, § 1434(b)(1), substituted ‘‘rules of subsections (c) and (d) of section 4216 (relating to partial payments) shall apply’’ for ‘‘rules of— ‘‘(1) subsections (c) and (d) of section 4216 (relating to partial payments), and ‘‘(2) section 4222 (relating to registration), shall apply’’. Subsec. (e). Pub. L. 105–34, § 1434(a), redesignated sub- sec. (f) as (e). Subsec. (f). Pub. L. 105–34, § 1434(a), added subsec. (f). Former subsec. (f) redesignated (e). Subsec. (g). Pub. L. 105–34, § 1434(b)(2), added subsec. (g). 1988—Subsec. (a)(1). Pub. L. 100–647 substituted ‘‘pro- duction, manufacture’’ for ‘‘manufacture, production’’. 1987—Subsec. (a)(1). Pub. L. 100–17, § 505(a), inserted ‘‘or leasing in a long-term lease’’ after ‘‘resale’’. Subsec. (b)(3). Pub. L. 100–17, § 505(b), added par. (3). Subsec. (b)(4). Pub. L. 100–17, § 506(a), added par. (4). Subsec. (f). Pub. L. 100–17, § 505(c), added subsec. (f). 1984—Subsec. (b)(1)(B)(iv). Pub. L. 98–369, § 731, added cl. (iv). Subsec. (c). Pub. L. 98–369, § 735(b)(2), in amending subsec. (c) generally, designated existing provisions as par. (1), in par. (1) as so designated substituted ‘‘by rea- son of merely combining such article with any article listed in paragraph (2)’’ for ‘‘with any equipment or other item listed in section 4063(d)’’, and added par. (2). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1998 AMENDMENT Amendment by Pub. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 6024 of Pub. L. 105–206, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1997 AMENDMENT Amendment by section 1402(b) of Pub. L. 105–34 effec- tive Jan. 1, 1998, see section 1402(c) of Pub. L. 105–34, set out as a note under section 4051 of this title. Pub. L. 105–34, title XIV, § 1434(c), Aug. 5, 1997, 111 Stat. 1052, provided that: ‘‘The amendments made by this section [amending this section] shall take effect on January 1, 1998.’’ EFFECTIVE DATE OF 1988 AMENDMENT Pub. L. 100–647, title VI, § 6111(b), Nov. 10, 1988, 102 Stat. 3713, provided that: ‘‘The amendment made by subsection (a) [amending this section] shall take effect on January 1, 1988.’’ EFFECTIVE DATE OF 1987 AMENDMENT Pub. L. 100–17, title V, § 505(d), Apr. 2, 1987, 101 Stat. 259, provided that: ‘‘The amendments made by this sec- tion [amending this section] shall apply with respect to articles sold by the manufacturer, producer, or im- porter on or after the first day of the first calendar quarter which begins more than 90 days after the date of the enactment of this Act [Apr. 2, 1987].’’ Pub. L. 100–17, title V, § 506(b), Apr. 2, 1987, 101 Stat. 259, provided that: ‘‘The amendment made by this sec- tion [amending this section] shall apply with respect to articles sold by the manufacturer, producer, or im- porter on or after the 1st day of the 1st calendar quar- ter which begins more than 90 days after the date of the enactment of this Act [Apr. 2, 1987].’’ EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98–369 effective, except as oth- erwise provided, as if included in the provisions of the Highway Revenue Act of 1982, title V of Pub. L. 97–424, to which such amendment relates, see section 736 of Pub. L. 98–369, set out as a note under section 4051 of this title. § 4053. Exemptions No tax shall be imposed by section 4051 on any of the following articles: (1) Camper coaches bodies for self-propelled mobile homes Any article designed— (A) to be mounted or placed on automobile trucks, automobile truck chassis, or auto- mobile chassis, and (B) to be used primarily as living quarters or camping accommodations. (2) Feed, seed, and fertilizer equipment Any body primarily designed— (A) to process or prepare seed, feed, or fer- tilizer for use on farms, (B) to haul feed, seed, or fertilizer to and on farms, (C) to spread feed, seed, or fertilizer on farms, (D) to load or unload feed, seed, or fer- tilizer on farms, or (E) for any combination of the foregoing. (3) House trailers Any house trailer. (4) Ambulances, hearses, etc. Any ambulance, hearse, or combination am- bulance-hearse. (5) Concrete mixers Any article designed— (A) to be placed or mounted on an auto- mobile truck chassis or truck trailer or semitrailer chassis, and (B) to be used to process or prepare con- crete. (6) Trash containers, etc. Any box, container, receptacle, bin or other similar article—