Cigarette Excise Tax: Guide for Beginners
Within the United States, the IRS Cigarette Excise Tax is a federal tax that is levied on sales, manufacture and importation of cigarettes. This is targeted to companies operating in the tobacco sector and particularly those who produce, distribute or sell cigarettes. In this guide we will explain who has to register, which business categories are liable for this tax, what forms need to be sent including Form 720, and how it is possible to e-file with us.
What Is Cigarette Excise Tax?
A cigarette excise tax is a tax on cigarettes in relation to the crusade to suppress cigarette smoking to raise revenue for various public health programs: the “anti-tobacco tax program”. Manufacturers, importers, and some sellers of cigarettes must pay this cigarette excise tax. It is often incorporated in the selling price of the product.
Who Needs to File?
The Cigarette Excise Tax must be filed by:
- Cigarette Manufacturers: Manufacturing companies engaged in the business of manufacturing cigarettes and selling them within the US market are liable to pay excise tax at the point of taxation.
- Cigarette Importers: No person or corporation may import cigarettes into the U.S. without filing the tax. Anyone importing goods for resale or distribution must also log the tax.
- Cigarette Distributors: Any distributor or wholesaler of cigarettes who buys cigarettes for resale to other businesses or retailers also needs to pay this tax.
If you are engaged in any of the above, you are also bound to make an appropriate filing under T.D. 9436 and accordingly remit the Cigarette Excise Tax to the U.S. Internal Revenue Services.
Company Categories for Filing
There are various cause types of the business that will need to return the Cigarette Excise Tax.
- Manufacturers: Companies who manufacture cigarettes for sale in the USA.
- Importers: Business Entities engaged in bringing cigarettes from outside for the purpose of sale or distribution.
- Distributors: Business Entities serving as wholesale dealers in marketing made cigarettes to retailers or such other businesses.
Compliance will depend on volume, type and rate of manufactured, imported or distributed cigarette and associated charges.
Filing With Form 720
Cigarette Excise Tax is Something to be Included in Report with IRS Form 720 Declaration of the U.S Treasury. Tax collects quarterly other payments taxes including payment for smokers’ and other range’s products’ sales.
Information Required for Completing the Form 720:
- Taxpayer Identification Number (TIN): Your business’s federal tax identification number.
- Taxable Sales: Figures on the number of cigarette packs sold, disseminated or brought inside the country.
- Calculation of the Full Tax: The accumulation of excise taxes applicable on sales or imports of made or raw cigarettes respectively.
The Excise Tax return shall be filed on a quarterly basis. Not filing the return or under-reporting the revenue may lead to penalties and interest.
E-Filing with Us
Filling up the Cigarette Excise Tax form, the authorities consider it to be an online form – the easiest way to achieve your objectives. When you opt for e-filing with us:
- Faster Processing : Forget about the times wasted doing mailings and paper processing.
- Enhanced Accuracy : Our system computes the figure of the tax that the taxpayer owes eliminating the possibilities of errors.
- Security: The entire filing process is made safe in that encryption of data is up throughout the filing period.
By e-filing the Form 720 for your Cigarette Excise Tax, you will be able to receive a confirmation at once and at the same time meet the federal compliance requirements. We are here to help you every step of the way providing each one of you how best you can file.
Advantages of E-Filing
- Convenience: Taxpayers should fill up the form anywhere and at their preferred time.
- Speed: Real time confirmation and faster acknowledgment from the IRS will be made.
- Peace of Mind: Know where your filing stands at all times and therefore no fear of penalties and late fees.
To enable you file your Cigarette Excise Tax and remit it on time, you can e-file with us.