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June 3, 2024

Polyoxymethylene Added to List of Chemical Substances Subject to Superfund Excise Tax

Lynn L. Bergeson Carla N. Hutton

The Internal Revenue Service (IRS) published a notice of determination on May 31, 2024, that the list of taxable substances is modified to include polyoxymethylene. 89 Fed. Reg. 47238. As reported in our December 29, 2022, blog item, the IRS announced in December 2022 that it received a petition requesting the addition of polyoxymethylene to the list of taxable substances under Section 4672(a) of the Internal Revenue Code. Celanese Ltd., an exporter of polyoxymethylene, submitted the petition. According to the petition, “the taxable chemical methane constitutes 50.08 percent, by weight, of the materials used to produce polyoxymethylene.” The IRS states that “[a] review of the stoichiometric material consumption equation and other information in the petition shows that methane, a taxable chemical, constitutes more than 20 percent by weight of the materials used in the production of polyoxymethylene, based on the predominant method of production. Therefore, the test in section 4672(a)(2)(B) is satisfied.” The effective date of the modification for tax purposes is October 1, 2024. The effective date of this modification for purposes of refund claims under Section 4662(e) of the Internal Revenue Code is July 1, 2022. More information on the Superfund excise tax on chemicals is available in our July 13, 2022, memorandum, “Superfund Tax on Chemicals: What You Need to Know to Comply” and our May 19, 2022, memorandum, “Reinstated Superfund Excise Tax Imposed on Certain Chemical Substances.”