September 2018 Deposits of the Oil Spill Liability Tax

This announcement provides information on how to calculate deposits of the § 4611 oil spill liability tax for the second semimonthly period in September 2018 under the modified safe harbor deposit rule described in Section 9 of Notice 2018-21, 2018-15 I.R.B. 472. 

Section 6302 and § 40.6302(c)-2(a)(1) of the Excise Tax Procedural Regulations require separate deposits for the second semimonthly period in September, one for the period from September 16 through September 26 and a second for the period from September 27 through September 30. 

Section 9 of Notice 2018-21 provides that for purposes of deposits of the oil spill liability tax during the third calendar quarter of 2018, persons will be considered to have met the semimonthly deposit requirement for that quarter if: (1) the deposit for each semimonthly period in the quarter is not less than 1/2 of the net tax liability reported for the look-back quarter; (2) each deposit is made on time; and (3) the amount of any underpayment is paid by the due date of the return.  The notice further provides that no affirmative election or other special filing is required in order for a person to use the modified safe harbor provided in the notice and that the modified safe harbor applies only with regard to deposits of the oil spill liability tax during the third calendar quarter of 2018.  Notice 2018-21 does not, however, inform persons using the modified safe harbor how to calculate the special deposits required for the second semimonthly period in September. 

For purposes of calculating the amount of the deposits of the § 4611 oil spill liability tax for the periods September 16 through September 26 and September 27 through September 30, taxpayers using the Notice 2018-21 modified safe harbor deposit rule may use any reasonable method to allocate the second semimonthly deposit for September between these two periods, so long as the total deposit for the second semimonthly period in September is not less than 1/2 of the net tax liability reported for the look-back quarter as described in Notice 2018-21. 

This announcement further serves to remind all excise taxpayers making deposits under § 40.6302(c)-2(a)(1) that this year September 29 falls on a Saturday. As a result, pursuant to § 40.6302(c)-2(a)(3)(i)(A), the deposit required for the period beginning September 16 must be made by Friday, September 28.