nection with, or with the sale of, any other article manufactured or produced by him; and

(B) such other article is by any person exported, sold to a State or local government for the exclusive use of a State or local government, sold to a nonprofit educational organization for its exclusive use, or used or sold for use as supplies for vessels or aircraft,

any tax imposed by chapter 32 in respect of such tire or inner tube which has been paid by the manufacturer, producer, or importer thereof shall be deemed to be an overpayment by him.

(5) Return of CERTAIN INSTALLMENT ACCOUNTS.—If—

(A) tax was paid under section 4216(e)(1) in respect of any installment acount,

(B) such account is, under the agreement under which the account was sold, returned to the person who sold such account, and

(C) the consideration is readjusted as provided in such agreement,

the part of the tax paid under section 4216(e)(1) allocable to the part of the consideration repaid or credited to the purchaser of such account shall be deemed to be an overpayment.

This subsection shall apply in respect of an article only if the exportation or use referred to in the applicable provision of this subsection occurs before any other use, or, in the case of a sale or resale, the use referred to in the applicable provision of this subsection is to occur before any other use. (c) Credit for tax paid on tires or inner tubes

If tires or inner tubes on which tax has been paid under chapter 32 are sold on or in connection with, or with the sale of, another article taxable under chapter 32, there shall (under regulations prescribed by the Secretary or his delegate) be credited (without interest) against the tax imposed on the sale of such other article, an amount determined by multiplying the applicable percentage rate of tax for such other article by

(1) the purchase price (less, in the case of tires, the part of such price attributable to the metal rim or rim base), if such tires or inner tubes were taxable under section 4071 (relating to tax on tires and inner tubes); or

(2) if such tires or inner tubes were taxable under section 4218 (relating to use by manufacturer, producer, or importer), the price (less, in the case of tires, the part of such price attributable to the metal rim or rim base) at which such or similar tires or inner tubes are sold, in the ordinary course of trade, by manufacturers, producers, or importers thereof, as determined by the Secretary or his delegate.

(d) Repealed

Pub. L. 89-44, Title VI, § 601 (c) (14), June 21, 1965, 79 Stat. 154.

218-927 - 77 - 21

(e) Refund to exporter or shipper

Under regulations prescribed by the Secretary or his delegate the amount of any tax imposed by subchapter E of chapter 31, or chapter 32 erroneously or illegally collected in respect of any article exported to a foreign country or shipped to a possession of the United States may be refunded to the exporter or shipper thereof, if the person who paid such tax waives his claim to such amount.

(f) Credit on returns

Any person entitled to a refund of tax imposed by chapter 31 or 32, paid to the Secretary or his delegate may, instead of filing a claim for refund, take credit therefor against taxes imposed by such chapter due on any subsequent return.

(g) Trucks, buses, tractors, etc.

Under regulations prescribed by the Secretary or his delegate, subsection (b) (2) (A) shall apply, in the case of any article subject to the tax imposed by section 4061(a), only if the article with respect to which the tax was paid was sold by the manufacturer, producer, or importer for export after receipt by him of notice of intent to export or to resell for export.

(h) Accounting procedures for like articles

Under regulations prescribed by the Secretary or his delegate, if any person uses or resells like articles, then for purposes of this section the manufacturer, producer, or importer of any such article may be identified, and the amount of tax paid under chapter 32 in respect of such article may be determined

(1) on a first-in-first-out basis,

(2) on a last-in-first-out basis, or

(3) in accordance with any other consistent method approved by the Secretary or his delegate.

(i) Meaning of terms

For purposes of this section, any term used in this section has the same meaning as when used in chapter 31, 32, or 33, as the case may be. (Aug. 16, 1954, c. 736, 68A Stat. 798; Aug. 11, 1955, c. 793, § 2, 69 Stat. 676; Aug. 11, 1955, c. 805, §§ 1(h), (i), 2(b), 69 Stat. 690; Apr. 2, 1956, c. 160, § 2(b) (1), 70 Stat. 90; June 29, 1956, c. 462, Title II, § 208(b), 70 Stat. 393; June 30, 1958, Pub. L. 85-475, § 4(b) (5), (6), 72 Stat. 260; Sept. 2, 1958, Pub. L. 85-859, Title I, § 163 (a), (c), 72 Stat. 1306, 1311; Sept. 21, 1959, Pub. L. 86–342, Title II, § 201 (d) (1), 73 Stat. 614; Apr. 8, 1960, Pub. L. 86-418, § 3, 74 Stat. 38; Sept. 14, 1960, Pub. L. 86–781, § 2, 74 Stat. 1018; June 29, 1961, Pub. L. 87-61, Title II, § 205 (c), (d), 75 Stat. 126; June 28, 1962, Pub. L. 87-508, § 5(c) (3), 76 Stat. 119; June 21, 1965, Pub. L. 89-44, Title II, § 207 (c), Title VI, § 601 (c), Title VIII, § 801 (d) (2), 79 Stat. 140, 153, 158; May 21, 1970, Pub. L. 91-258, Title II, §§ 205 (b) (3), (4), and 207 (d) (4)-(7), 84 Stat. 242, 248, 249; Dec. 31,

1970, Pub. L. 91-614, Title III, § 302, 84 Stat. 1845; Dec. 10, 1971, Pub. L. 92-178, Title IV, § 401 (a) (3) (C), (g) (6), 85 Stat. 531, 534.)

Sec. 6420. Gasoline used on farms.

(a) Gasoline

Except as provided in subsection (h), if gasoline is used on a farm for farming purposes, the Secretary or his delegate shall pay (without interest) to the ultimate purchaser of such gasoline the amount determined by multiplying

(1) the number of gallons so used, by

(2) the rate of tax on gasoline under section 4081 which applied on the date he purchased such gasoline.

(b) Time for filing claim; period covered.—

(1) Gasoline USED BEFORE JULY 1, 1965.-Except as provided in paragraph (2), not more than one claim may be filed under this section by any person with respect to gasoline used during the one-year period ending on June 30 of any year. No claim shall be allowed under this paragraph with respect to any one-year period unless filed on or before September 30 of the year in which such one-year period ends. (2) GASOLINE USED AFTER JUNE 30, 1965.-In the case of gasoline used after June 30, 1965—

(A) not more than one claim may be filed under this section by any person with respect to gasoline used during his taxable year; and

(B) no claim shall be allowed under this section with respect to gasoline used during any taxable year unless filed by such person not later than the time prescribed by law for filing a claim for credit or refund of overpayment of income tax for such taxable year. For purposes of this paragraph, a person's taxable year shall be his taxable year for purposes of subtitle A, except that a person's first taxable year beginning after June 30, 1965, shall include the period after June 30, 1965, and before the beginning of such first taxable year.

(c) Meaning of terms

For purposes of this section

(1) USE ON A FARM FOR FARMING PURPOSes.- -Gasoline shall be treated as used on a farm for farming purposes only if used (A) in carrying on a trade or business, (B) on a farm situated in the United States, and (C) for farming purposes.

(2) FARM. The term "farm" includes stock, dairy, poultry, fruit, fur-bearing animal, and truck farms, plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards.

(3) FARMING PURPOSES.-Gasoline shall be treated as used for farming purposes only if used

(A) by the owner, tenant, or operator of a farm, in connection with cultivating the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, including the raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and fur-bearing animals and wildlife, on a farm of which he is the owner, tenant, or operator; except that if such use is by any person other than the owner, tenant, or operator of such farm, then (i) for purposes of this subparagraph, in applying subsection (a) to this subparagraph, and for purposes of section 6416(b) (2) (G) (ii) (but not for purposes of section 4041), the owner, tenant, or operator of the farm on which gasoline or a liquid taxable under section 4041 is used shall be treated as the user and ultimate purchaser of such gasoline or liquid, and (ii) for purposes of applying section 6416(b) (2) (G) (ii), any tax paid under section 4041 in respect of a liquid used on a farm for farming purposes (within the meaning of this subparagraph) shall be treated as having been paid by the owner, tenant, or operator of the farm on which such liquid is used;

(B) by the owner, tenant, or operator of a farm, in handling, drying, packing, grading, or storing any agricultural or horticultural commodity in its unmanufactured state; but only if such owner, tenant, or operator produced more than one-half of the commodity which he so treated during the period with respect to which claim is filed;

(C) by the owner, tenant, or operator of a farm, in connection with

(i) the planting, cultivating, caring for, or cutting of trees, or (ii) the preparation (other than milling) of trees for market, incidental to farming operations; or

(D) by the owner, tenant, or operator of a farm, in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment.

(4) GASOLINE.-The term "gasoline" has the meaning given to such term by section 4082 (b).

(d) Exempt sales; other payments or refunds available

No amount shall be payable under this section with respect to any gasoline which the Secretary or his delegate determines was exempt from the tax imposed by section 4081. The amount which (but for this sentence) would be payable under this section with respect to any gasoline shall be reduced by any other amount which the Secretary or his delegate determines is payable under this section, or is refundable under any provision of this title, to any person with respect to such gasoline.

(e) Applicable laws

(1) IN GENERAL.-All provisions of law, including penalties, applicable in respect of the tax imposed by section 4081 shall, insofar as

applicable and not inconsistent with this section, apply in in* respect of the payments provided for in this section to the same extent as if such payments constituted refunds of overpayments of the tax so imposed.

(2) EXAMINATION OF BOOKS And witnesses. For the purpose of ascertaining the correctness of any claim made under this section, or the correctness of any payment made in respect of any such claim, the Secretary or his delegate shall have the authority granted by paragraphs (1), (2), and (3) of section 7602 (relating to examination of books and witnesses) as if the claimant were the person liable for tax.

(3) FRACTIONAL PARTS OF A DOLLAR.- -Section 7504 (granting the Secretary discretion with respect to fractional parts of a dollar) shall not apply.

(f) Regulations

The Secretary or his delegate may by regulations prescribe the conditions, not inconsistent with the provisions of this section, under which payments may be made under this section.

(g) Effective date

This section shall apply only with respect to gasoline purchased after December 31, 1955.

(h) Income tax credit in lieu of payment

(1) PERSONS NOT SUBJECT TO INCOME TAX.-Payment shall be made under subsection (a) with respect to gasoline used after June 30, 1965, only to

(A) the United States or an agency or instrumentality thereof, a State, a political subdivision of a State, or an agency or instrumentality of one or more States or political subdivisions, or

(B) an organization exempt from tax under section 501 (a) (other than an organization required to make a return of the tax imposed under subtitle A for its taxable year).

(2) ALLOWANCE OF CREDIT AGAINST INCOME TAX.-For allowance of credit against the tax imposed by subtitle A for gasoline used after June 30, 1965, see section 39.

(i) Cross references

(1) For exemption from tax in case of special fuels used on a farm for farming purposes, see section 4041 (f).

(2) For civil penalty for excessive claim under this section, see section 6675.

(3) For fraud penalties, etc., see chapter 75 (section 7201 and following, relating to crimes, other offenses, and forfeitures).

(Added Apr. 2, 1956, c. 160, § 1, 70 Stat. 87, and amended Sept. 2, 1958, Pub. L. 85-859, Title I, § 163 (d) (2), 72 Stat. 1311; June 21, 1965, Pub.

*So in original.