Editor's Note:
Pub. L. 113-295, Div. A, Sec. 221(a)(103)(A), struck Sec. 4002, effective December 19, 2014.
I.R.C. § 4002(a) 1st Retail Sale —
For purposes of this subchapter, the term “1st retail sale” means the 1st sale,
for a purpose other than resale, after manufacture, production, or importation.
I.R.C. § 4002(b) Use Treated As Sale
I.R.C. § 4002(b)(1) In General —
If any person uses a passenger vehicle (including any use after importation) before
the 1st retail sale of such vehicle, then such person shall be liable for tax under
this subchapter in the same manner as if such vehicle were sold at retail by him.
I.R.C. § 4002(b)(2) Exemption For Further Manufacturer —
Paragraph (1) shall not apply to use of a vehicle as material in the manufacture
or production of, or as a component part of, another vehicle taxable under this
subchapter to be manufactured or produced by him.
I.R.C. § 4002(b)(3) Exemption For Demonstration Use —
Paragraph (1) shall not apply to any use of a passenger vehicle as a demonstrator.
I.R.C. § 4002(b)(4) Exception For Use After Importation Of Certain Vehicles —
Paragraph (1) shall not apply to the use of a vehicle after importation if the user
or importer establishes to the satisfaction of the Secretary that the 1st use of
the vehicle occurred before January 1, 1991, outside the United States.
I.R.C. § 4002(b)(5) Computation Of Tax —
In the case of any person made liable for tax by paragraph
(1), the tax shall be computed on the price at which similar vehicles are sold at
retail in the ordinary course of trade, as determined by the Secretary.
I.R.C. § 4002(c) Leases Considered As Sales —
For purposes of this subchapter—
I.R.C. § 4002(c)(1) In General —
Except as otherwise provided in this subsection, the lease of a vehicle (including
any renewal or any extension of a lease or any subsequent lease of such vehicle)
by any person shall be considered a sale of such vehicle at retail.
I.R.C. § 4002(c)(2) Special Rules For Long-Term Leases
I.R.C. § 4002(c)(2)(A) Tax Not Imposed On Sale For Leasing In A Qualified Lease. —
The sale of a passenger vehicle to a person engaged in a passenger vehicle leasing
or rental trade or business for leasing by such person in a long-term lease shall
not be treated as the 1st retail sale of such vehicle.
I.R.C. § 4002(c)(2)(B) Long-Term Lease —
For purposes of subparagraph (A), the term “long-term lease” means any long-term
lease (as defined in section 4052).
I.R.C. § 4002(c)(2)(C) Special Rules —
In the case of a long-term lease of a vehicle which is treated as the 1st retail
sale of such vehicle—
I.R.C. § 4002(c)(2)(C)(i) Determination Of Price —
The tax under this subchapter shall be computed on the lowest price for which the
vehicle is sold by retailers in the ordinary course of trade.
I.R.C. § 4002(c)(2)(C)(ii) Payment Of Tax —
Rules similar to the rules of section 4217(e)(2) shall apply.
I.R.C. § 4002(c)(2)(C)(iii) No Tax Where Exempt Use By Lessee —
No tax shall be imposed on any lease payment under a long-term lease if the lessee's
use of the vehicle under such lease is an exempt use (as defined in section 4003(b)) of such vehicle.
I.R.C. § 4002(d) Determination Of Price
I.R.C. § 4002(d)(1) In General —
In determining price for purposes of this subchapter—
I.R.C. § 4002(d)(1)(A) —
there shall be included any charge incident to placing the passenger vehicle in condition
ready for use,
I.R.C. § 4002(d)(1)(B) —
there shall be excluded—
I.R.C. § 4002(d)(1)(B)(i) —
the amount of the tax imposed by this subchapter,
I.R.C. § 4002(d)(1)(B)(ii) —
if stated as a separate charge, the amount of any retail sales tax imposed by any
State or political subdivision thereof or the District of Columbia, whether the liability
for such tax is imposed on the vendor or vendee, and
I.R.C. § 4002(d)(1)(B)(iii) —
the value of any component of such passenger vehicle if—
I.R.C. § 4002(d)(1)(B)(iii)(I) —
such component is furnished by the 1st user of such passenger vehicle, and
I.R.C. § 4002(d)(1)(B)(iii)(II) —
such component has been used before such furnishing, and
I.R.C. § 4002(d)(1)(C) —
the price shall be determined without regard to any trade-in.
I.R.C. § 4002(d)(2) Other Rules —
Rules similar to the rules of paragraphs (2) and (4)
of section 4052(b) shall apply for purposes of this subchapter.
(Added by Pub. L. 103-66, Sec. 13161(a), Aug. 10, 1993; repealed by Pub. L. 113-295, Div. A, title II, Sec. 221(a)(103)(A), Dec. 19, 2014, 128 Stat. 4010.)
BACKGROUND NOTES
AMENDMENTS
2014 - Pub. L. 113-295, Div. A, Sec. 221(a)(103)(A), repealed Section 4002.
1993 - Pub. L. 103-66, Sec. 13161(a), added new Section 4002 to read as above, effective Jan. 1, 1993. Prior to amendment,
Section 4002 read as follows:
“Section 4002. BOATS
“(a) Imposition of Tax.--There is hereby imposed on the 1st retail sale of any boat
a tax equal to 10 percent of the price for which so sold to the extent such price
exceeds $100,000.
“(b) Exceptions.--The tax imposed by this section shall nor apply to the sale of any
boat for use by the purchaser exclusively in the active conduct of--
“(1) a trade or business of commercial fishing or transporting persons or property
for compensation of hire, or
“(2) any other trade or business unless the boat is to be used predominantly in any
activity which is of a type generally considered to constitute entertainment, amusement,
or recreation.”
EFFECTIVE DATE OF REPEAL
Repeal by Pub. L. 113-295, Div. A, Sec. 221(a)(103)(A), effective December 19, 2014.
Section 221(b)(2) of Pub. L. 113-295, Div. A, provided the following Savings Provision:
“(2)
SAVINGS PROVISION.—If—
“(A)
any provision amended or repealed by the amendments made by this section applied to—
“(i)
any transaction occurring before the date of the enactment of this Act [Enacted: Dec.
19, 2014],
“(ii)
any property acquired before such date of enactment, or
“(iii)
any item of income, loss, deduction, or credit taken into account before such date
of enactment, and
“(B)
the treatment of such transaction, property, or item under such provision would (without
regard to the amendments or repeals made by this section)
affect the liability for tax for periods ending after date of enactment, nothing in
the amendments or repeals made by this section shall be construed to affect the treatment
of such transaction, property, or item for purposes of determining liability for tax
for periods ending after such date of enactment.”
EFFECTIVE DATE
Effective January 1, 1993.
