Federal excise tax as defined by the IRS

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Updated Feb 23, 2023
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[This article was originally published in 2019 by Trucks, Parts, Service. It has been updated to include more timely information.]

The parameters of the United States' federal excise tax on heavy trucks and trailers is contained in IRS Internal Revenue Code (IRC) Section 4051. According to the IRS, Section 4051 imposes a 12 percent excise tax "on the first retail sale of automobile truck chassis and bodies, truck trailer and semitrailer chassis and bodies, and tractors of the kind chiefly used for highway transportation in combination with a trailer or semitrailer."

The IRS also states the tax is not limited to commercial vehicles, thus, "a vehicle may be subject to tax even if sold for use or used as a recreational or private tow vehicle rather than for commercial purposes."

[RELATED: How the American Truck Dealers (ATD) are working to repeal Federal excise tax laws]

The IRS says units contained within the tax are as follows: 

  • Automobile truck bodies and chassis having a gross vehicle weight of over 33,000 lb.
  • Truck trailer and semi-trailer bodies and chassis suitable for use with a trailer or semi-trailer having a gross vehicle weight of over 26,000 lb.
  • Tractors of the kind chiefly used for highway transportation in combination with a trailer or semi-trailer having a gross vehicle weight over 19,500 lb., and a gross combined weight over 33,000 lb.

Federal excise tax also can apply to parts and accessories purchased within six months after a taxable vehicle is placed into service that do not qualify as replacement parts or accessories and cost more than $1,000 for the price of the parts and their installation. 

Additionally, the IRS states, “’First retail sale means the first sale, for a purpose other than resale or leasing in a long-term lease, after manufacture, production or importation. The tax is 12 percent of the price for which the article is sold. The person making the first retail sale (often a franchised truck dealer) is liable for the tax.

“If, however, any person uses an article taxable under IRC section 4051 before a first retail sale, tax is imposed on the article as if the article had been sold at retail by that person.”

Some exemptions do exist, such as components installed on bodies, chassis or tractors before a first retail sale in which excise tax has already been paid (such as tires); bodies and chassis with gross vehicle weight below the aforementioned standards above, idle reduction technologies and more.

Regarding truck body types specifically, the IRS states it does not challenge a seller's determination that the following body types are excluded from retail excise tax:

  • Platform truck bodies of 21 ft., or less in length.
  • Dry freight and refrigerated truck van bodies 24 ft., or less in length.
  • Dump truck bodies with load capacities of 8 cubic yds., or less.
  • Refuse packer truck bodies with load capacities of 20 cubic yds., or less. 

As for collection and payment, IRS documentation also states that, generally, “semi-monthly deposits of excise taxes are required. A semi-monthly period is the first 15 days of a month (the first semi-monthly period) or the 16th through the last day of a month (the second semi-monthly period).”

The agency adds, “the deposit of tax for a semi-monthly period is due by the 14th day following that period. Generally, this is the 29th day of a month for the first semi-monthly period and the 14th day of the following month for the second semi-monthly period.”

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