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Industry Circular

Number: 56-30
Date: August 22, 1956

Internal Revenue Service
Washington 25, D.C.


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Information Relative to Supporting Records Maintained by Manufacturers of Cigars Who Pay Tax by Return

Manufacturers of cigars:

1. The purpose of this industry circular is to furnish advice relative to the supporting records to be kept by manufacturers of cigars who pay tax on cigars by return, as required by regulations 26 CFR 270.224, as added by Treasury Decision 6185.

2. The National Office has been informed that for years the manufacturers have been maintaining in their factories invoices and other commercial records of cigars removed subject to tax and for tax-exempt purposes. While such invoices and records show the quantities of cigars of each brand removed, the names and addresses of the persons to whom the cigars are shipped or delivered, and the prices charged for the cigars, in many cases such invoices and records do not show specifically the internal revenue classes of the cigars. However, it is understood that the classes of cigars can be readily determined from the information contained in such invoices and records.

3. The regulations (26 CFR 270.224) require that every manufacturer who pays tax on his cigars by return, Form 2135, shall keep a supporting record, in addition to Form 2142 or 2143, as the case may be, which shall show, with respect to each removal, the date of the removal, the name and address of the person to whom the cigars are shipped or delivered, and the class and quantity of cigars. However, the section further provides that where the manufacturer keeps copies of invoices or other commercial records containing the information required as to each such removal, in such orderly manner that such information may be readily ascertained therefrom by revenue officers, such copies will be considered the supporting record required by this section.

4. Therefore, the regulations will be satisfied in this respect where manufacturers maintain commercial records from which revenue officers may readily determine the classes of cigars removed, although such records do not show specifically the classes of the cigars removed.

5. Inquiries in regard to this industry circular should refer to the number thereof and should be directed to the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.


Dwight E. Avis
Director, Alcohol and Tobacco Tax Division


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