§4105 Two-party Exchanges

Summary

When two registered parties exchange taxable fuel at a terminal, the delivering person is not responsible for paying the tax imposed under section 4081(a)(1)(A)(ii). A "two-party exchange" is a non-sale transfer of taxable fuel between two people who are both registered under section 4101 and that meets four rules: the delivering person is shown as holding the terminal inventory in the terminal operator’s records; the transfer happens before or when the receiving person removes the fuel across the rack; the terminal operator reports the receiving person as the remover; and there is a written contract.