The IRS has directed businesses to its frequently asked questions webpage on two recently reinstated Superfund chemical excise taxes in order to help taxpayers who may be impacted, as well as tax professionals.
Excise taxes imposed on certain chemicals and imported chemical substances were reinstated, effective July 1, under the Infrastructure Investment and Jobs Act (IIJA). Companies have not had to pay this tax since the previous Superfund excise taxes expired on Dec. 31, 1995.
There are two separate Superfund chemical excise taxes: a tax on the sale or use of “taxable chemicals” and a tax on the sale or use of imported “taxable substances.”
Specifically, the reinstated taxes impose an excise tax on the sale or use of a taxable chemical by the manufacturer, producer or importer of the taxable chemical. They also impose an excise tax on the sale or use of a taxable substance by the importer of the taxable substance.
As of June 24, there are 42 taxable chemicals and 151 taxable chemical substances on the IRS list.
The FAQs detail what the Superfund chemical excise tax is, how the tax is computed and who may be liable for the tax. The Superfund chemical taxes will be reported on Form 720, Quarterly Federal Excise Tax Return, and Form 6627, Environmental Taxes.
The first quarterly Superfund Tax reporting on Form 720 is due Oct. 31 for the calendar quarter ending Sept. 30. Taxpayers with a quarterly liability greater than $2,500 will be required to make semimonthly deposits of at least 95% of the net tax liability incurred. The first deposit of Superfund Tax is due as early as July 29.
More information can be found at Excise Tax on IRS.gov.
