§4223 — Title 26 Internal Revenue Code | U.S. Code

Summary

If you buy an article tax-free under section 4221(a)(1) to use in making something else, you are treated as the article's manufacturer. If you then owe excise tax on selling or using it, and the tax is based on sale price, the tax normally uses your selling price. You can instead elect, if you can prove the price to the IRS, to use the price you paid for the article or the price the original manufacturer sold it for.

Title 26, §4223

Internal Revenue Code — Source: USLM XML via OLRC

(a)For purposes of this chapter, a manufacturer or producer to whom an article is sold or resold free of tax under section 4221(a)(1) for use by him in further manufacture shall be treated as the manufacturer or producer of such article.

(b)If the manufacturer or producer referred to in subsection (a) incurs liability for tax under this chapter on his sale or use of an article referred to in subsection (a) and the tax is based on the price for which the article is sold, the article shall be treated as having been sold by him—

(1)at the price for which the article was sold by him (or, where the tax is on his use of the article, at the price referred to in section 4218(c)); or

(2)if he so elects and establishes such price to the satisfaction of the Secretary—

(A)at the price for which the article was sold to him; or

(B)at the price for which the article was sold by the person who (without regard to subsection (a)) is the manufacturer, producer, or importer of such article.

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 4223, act Aug. 16, 1954, ch. 736, 68A Stat. 495, related to exemption of articles manufactured or produced by Indians, prior to repeal by Pub. L. 85–859, § 119(a). See section 4225 of this title.

Amendments

1984—Subsec. (b)(1). Pub. L. 98–369 substituted “4218(c)” for “section 4218(e)”. 1976—Subsec. (b) Pub. L. 94–455 struck out “or his delegate” after “Secretary”. 1960—Subsec. (b)(1). Pub. L. 86–418 substituted “section 4218(e)” for “section 4218(d)”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1984 AmendmentAmendment by Pub. L. 98–369 effective, except as otherwise 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.

Effective Date

of 1960 AmendmentAmendment by Pub. L. 86–418 applicable only with respect to bicycle tires and tubes sold by the manufacturer, producer, or importer thereof on or after the first day of the first month which begins more than 10 days after April 8, 1960, see section 4 of Pub. L. 86–418, set out as a note under section 4221 of this title.

§4223 Special Rules Relating to Further Manufacture

Summary

Title 26, §4223

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata