Motor Fuels Tax Minute, Episode 9

Changes to the Internal Revenue Manual is the topic for this week’s Motor Fuels Tax Minute. Join our hosts for an overview of the processing times for the Form 637 registration. 

 

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Detailed Transcription of Weaver’s Motor Fuels Tax Minute, Episode 9

00:00:00

Leanne: Welcome to Weaver's Motor Fuels Tax Minute, where we talk all things motor fuels. This week we're talking about a recent change to the Internal Revenue Manual relating to the processing times for the Form 637 registration.

00:00:14

Emilda: Traditionally, the IRS has advised that the Form 637 registration takes about 90 days to process from the time it's received at the service center. Within 14 days, an initial review would be completed and the application assigned to an agent would then see the application through to completion. Applicants, and their advisors, would be able to contact the IRS after the initial 14-day period to get a status update and find out which agent the application was assigned to.

00:00:47

Leanne: That's right, Emilda. We were recently looking through the Internal Revenue Manual and saw an August 2021 update that changed these timelines significantly.

The IRS now has 45 days to conduct an initial review. Applicants and their advisors shouldn't contact the IRS for any information on the status of the application. Once that initial 45 days have passed, applicants may reach out if they haven't received any correspondence or other communication. After the initial 45 days, the IRS has until around day 120 to complete the application.

00:01:25

Emilda: This is a very significant change. Not only is the timeline for the IRS to complete the review extended out by at least 30 days, but it seems from the discussions we've recently had with the IRS that the applications are going to be held for 45 days prior to the communication with the applicant. I think that's a really difficult time frame to deal with because most companies are not able to wait four or six months for these applications to be processed. I think that's adding a little bit more strain to the process that we're so used to seeing nowadays.

00:02:06

Leanne: Yes, Emilda, I completely agree. I think the big takeaway here is that applicants are now going to have to allow a minimum of four months for processing a Form 637 application. I think it's worth noting that this includes the G registrations. Those were previously being fast tracked with the reinstatement of the Superfund tax, but now we're hearing that they're not going to do that.

00:02:29

Emilda: That's correct. I think that the IRS is slowing down more with the applications and they're also going to go back and do an initial review of the 637’s again. It's slowing things down.

That is this week's Motor Fuels Tax Minute. Stay tuned next week when we will be discussing some of the special rules for September federal excise tax deposits.

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Leanne Sobel

Leanne Sobel

Director, Motor Fuels and Excise Tax Services

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Leanne Sobel, J.D., has over 15 years of experience in legal tax matters. Her career focus includes federal and state tax and…

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