[Federal Register Volume 89, Number 129 (Friday, July 5, 2024)]
[Rules and Regulations]
[Pages 55507-55511]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-14706]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 40 and 47

[TD 10003]
RIN 1545-BQ93


Excise Tax on Designated Drugs; Procedural Requirements

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final rule.

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SUMMARY: This document contains final regulations relating to the 
excise tax imposed on certain sales by manufacturers, producers, or 
importers of designated drugs. Specifically, the final regulations set 
forth procedural provisions relating to how taxpayers must report 
liability for such tax. The final regulations also except such tax from 
semimonthly deposit requirements. The final regulations affect 
manufacturers, producers, or importers of designated drugs dispensed, 
furnished, or administered to individuals under the terms of Medicare 
during certain statutory periods.

DATES: 
    Effective date: These regulations are effective on August 5, 2024.
    Applicability dates: For dates of applicability, see Sec. Sec.  
40.0-1(e), 40.6011(a)-1(e), 40.6302(c)-1(f), and 47.5000D-1(b).

FOR FURTHER INFORMATION CONTACT: Jacob W. Peeples or James S. Williford 
at (202) 317-6855 (not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    This document amends the Excise Tax Procedural Regulations (26 CFR 
part 40) and adds new part 47 to 26 CFR chapter I to contain the 
``Designated Drugs Excise Tax Regulations'' related to the excise tax 
imposed by section 5000D of the Internal Revenue Code (Code) on certain 
sales by manufacturers, producers, or importers of designated drugs 
(section 5000D tax).
    Sections 1191 through 1198 of the Social Security Act (SSA), added 
by sections 11001 and 11002 of Public Law 117-169, 136 Stat. 1818 
(August 16, 2022), commonly referred to as the Inflation Reduction Act 
of 2022 (IRA), require the Secretary of Health and Human Services to 
establish a Medicare prescription drug price negotiation program 
(Medicare Drug Price Negotiation Program) to negotiate maximum fair 
prices for certain high expenditure, single-source drugs covered under 
Medicare.
    Section 5000D, added to new chapter 50A of the Code by section 
11003 of the IRA, imposes an excise tax on certain sales by 
manufacturers, producers, or importers of designated drugs dispensed, 
furnished, or administered to individuals under the terms of Medicare 
during a day that falls within a period described in section 5000D(b). 
The periods described in section 5000D(b) relate to certain statutorily 
prescribed milestones in the Medicare Drug Price Negotiation Program. 
Because chapter 50A is a new chapter of the Code, the existing 
regulations that prescribe procedural rules applicable to most Federal 
excise taxes do not apply to chapter 50A.
    Notice 2023-52 (2023-35 I.R.B. 650; August 28, 2023) announced that 
the Department of the Treasury (Treasury Department) and the IRS 
intended to propose regulations addressing substantive and procedural 
issues related to the section 5000D tax.
    On October 2, 2023, a notice of proposed rulemaking (REG-115559-23) 
was published in the Federal Register (88 FR 67690) (proposed 
regulations). No public hearing was requested or held. The Treasury 
Department and the IRS received several comments in response to the 
proposed regulations. The comments addressing the proposed regulations 
are summarized in the Summary of Comments and Explanation of Revisions 
section of this preamble.

Summary of Comments and Explanation of Revisions

I. Overview

    As noted in the Background section of this preamble, the Treasury 
Department and the IRS received several public comment submissions in 
response to the proposed regulations. The public comments fall into six 
general categories: timing of the publication of the proposed 
regulations; the quarterly filing requirement in the proposed 
regulations; the proposed regulations'

[[Page 55508]]

retroactive applicability dates; the constitutionality of the section 
5000D tax; technical issues and questions relating to the 
implementation of the section 5000D tax itself; and comments on the 
Special Analyses provided in the proposed regulations. Each of these 
categories of comments is addressed in turn in parts II through VII of 
this Summary of Comments and Explanation of Revisions.
    All public comments were considered and are available at https://www.regulations.gov or upon request. After full consideration of the 
public comments received in response to the proposed regulations, this 
Treasury decision adopts the proposed regulations with three non-
substantive modifications. Specifically, the final regulations modify 
proposed Sec. Sec.  40.0-1, 40.6011-1(d), and 40.6302(c)-1 by 
clarifying that the section 5000D tax is imposed on ``the sale of'' 
designated drugs. The language, as modified, more closely tracks the 
language of section 5000D(a).

II. Timing of the Publication of the Proposed Regulations

    A commenter stated that the Treasury Department and the IRS acted 
prematurely when publishing proposed regulations related to procedural 
rules prior to publishing substantive rules for the section 5000D tax 
and requested that the Treasury Department and the IRS withdraw the 
proposed regulations until substantive rules are published.
    The section 5000D tax is a self-executing tax--that is, the section 
5000D tax is effective and applicable regardless of whether 
implementing regulations are published by the Treasury Department and 
the IRS. See Sundance Helicopters, Inc. v. United States, 104 Fed. Cl. 
1, 11 (2012) (in determining whether the issuance of regulations is a 
precondition to the application of a statute, the court followed Tax 
Court precedent in Estate of Neumann v. Comm'r, 106 T.C. 216 (1996) 
(setting out the rule that ``a tax statute is self-executing if the 
regulation referred to in the statute deals only with how, not whether, 
the tax is to be applied.'')). Further, under section 5000D(b)(1), the 
first date that a manufacturer, producer, or importer could be liable 
for the section 5000D tax is October 2, 2023. As a result, publication 
of the proposed regulations was not premature because liability can 
arise under section 5000D in the absence of substantive regulatory 
guidance, and taxpayers needed this procedural guidance on how to meet 
their tax reporting and payment obligations for section 5000D tax 
liability incurred on and after October 2, 2023. Accordingly, the 
Treasury Department and the IRS are finalizing the proposed regulations 
without adopting this comment.

III. Quarterly Filing Requirement

    A commenter expressed concern regarding the proposed regulations' 
quarterly filing and payment requirement. Specifically, the commenter 
stated that--in the absence of substantive guidance such as 
clarification of what sales are subject to the section 5000D tax--it is 
``impossible'' for the IRS to determine that a ``quarterly cadence'' 
for filing returns and paying the section 5000D tax is rational. 
Further, the commenter stated that the quarterly filing requirement 
will be overly burdensome on taxpayers.
    Generally, Sec.  40.6011(a)-1(a)(2)(i) requires that taxpayers 
subject to Federal excise tax must file a Form 720, Quarterly Federal 
Excise Tax Return, beginning with the first calendar quarter during 
which their Federal excise tax liability arises. Once the first Form 
720 is filed, a taxpayer is generally required to continue filing Forms 
720 for every calendar quarter thereafter--regardless of whether 
additional Federal excise tax liabilities are incurred during a 
particular subsequent calendar quarter--until the taxpayer permanently 
ceases all operations with respect to which the Federal excise tax 
liability was incurred. See Sec. Sec.  40.6011(a)-1(a)(2)(i) and 
40.6011(a)-2(a)(1). Failure to file subsequent quarterly returns after 
filing the first Form 720 may result in the assessment of penalties 
under section 6651(a) of the Code.
    In developing the proposed regulations, the Treasury Department and 
the IRS recognized that in the context of the section 5000D tax (under 
which a taxpayer may incur liability in a particular calendar quarter 
and then never incur liability again in subsequent calendar quarters), 
to require a taxpayer to continue to file Form 720 for every calendar 
quarter following the filing of its first Form 720 even if no tax 
liability is incurred in subsequent calendar quarters would be both 
unnecessary for tax administration and unduly burdensome on the 
taxpayer. As a result, the proposed regulations exempted taxpayers that 
incur a section 5000D tax liability (section 5000D taxpayers) and 
report that tax liability on a timely filed Form 720 from the general 
requirement to file subsequent Forms 720 if no section 5000D tax 
liability is incurred during a subsequent calendar quarter. 
Specifically, proposed Sec.  40.6011(a)-1(d) required a taxpayer to 
file a subsequent Form 720 only if a new section 5000D tax liability 
arises during a particular calendar quarter.
    Regarding the requirement to pay a section 5000D tax liability 
quarterly with the taxpayer's Form 720, generally, Sec. Sec.  
40.6071(a)-1(a) and 40.6151(a)-1 require that Form 720 filers must pay 
the tax shown on the return at the same time the return is filed. 
Providing a different rule for section 5000D taxpayers would introduce 
unnecessary complexity into the excise tax filing and payment regime. 
An increase in complexity could lead to taxpayer confusion and likely 
result in a greater burden on both taxpayers and the IRS with little to 
no benefit accruing to stakeholders. The Treasury Department and the 
IRS also note that proposed Sec.  40.6302(c)-1 exempted the section 
5000D tax from the semimonthly deposit requirements that apply to most 
other Federal excise taxpayers. By finalizing this proposed rule 
without this modification to the requirement to pay with the quarterly 
filing, the compliance burden on section 5000D taxpayers will be 
further reduced.
    For these reasons, as well as for reasons similar to those 
discussed in part II of this Summary of Comments and Explanation of 
Revisions (related to the necessity to timely provide section 5000D 
taxpayers with procedural guidance on how to meet their tax reporting 
and payment obligations), the Treasury Department and the IRS are 
finalizing the proposed regulations without adopting this comment.

IV. Applicability Dates

    The proposed regulations provided that the Treasury decision 
finalizing the proposed regulations will apply to calendar quarters 
beginning on or after October 1, 2023; in other words, the proposed 
regulations provided that this Treasury decision will not apply 
beginning on the date that it is published in the Federal Register, but 
rather it will retroactively apply as of the first day of the fourth 
calendar quarter of 2023. A commenter requested that the Treasury 
Department and the IRS reconsider the retroactive applicability dates 
provided in the proposed regulations because the section 5000D tax is 
new.
    As discussed in part II of this Summary of Comments and Explanation 
of Revisions, the Treasury Department and the IRS prioritized providing 
section 5000D taxpayers with procedural guidance on how to meet their 
tax reporting and payment obligations by October 2, 2023, the first 
date when a taxpayer could incur a section 5000D tax liability. Because 
the

[[Page 55509]]

first date when a taxpayer could incur liability for the section 5000D 
tax is October 2, 2023, which falls within the fourth calendar quarter 
of 2023, it is appropriate for the final regulations that provide rules 
relating to filing and payment of the section 5000D tax to relate back 
to the beginning of the fourth calendar quarter of 2023 (that is, 
October 1, 2023), which in accordance with section 7805(b)(1)(B), would 
be the first taxable period ending after October 2, 2023 (that is, the 
date the proposed regulations were published in the Federal Register). 
As a result, the Treasury Department and IRS are finalizing the 
proposed applicability dates without adopting this comment.

V. Constitutionality

    Some commenters stated that the Medicare Drug Price Negotiation 
Program generally, and the section 5000D tax specifically, may be 
unconstitutional. These comments are outside the scope of the proposed 
regulations, which set forth proposed rules for administering a duly 
enacted tax law. Therefore, it is not appropriate for the Treasury 
Department and the IRS to address these comments in the context of this 
rulemaking.

VI. Technical Comments

    A commenter requested that the Treasury Department and the IRS 
consider providing sales-reporting and calculation ``safe harbors'' in 
these final regulations. Another commenter stated their belief that 
Notice 2023-52 requested clarification on how the Treasury Department 
and the IRS should define ``sales'' for purposes of the section 5000D 
tax. These comments are outside the scope of the proposed regulations, 
which related only to the procedures for reporting and paying the 
section 5000D tax.

VII. Comments on the Special Analyses

A. Paperwork Reduction Act

    A commenter requested that the Treasury Department and the IRS 
reconsider the paperwork burden estimate in the Paperwork Reduction Act 
(44 U.S.C. 3507(d)) (PRA) section of the proposed regulations because 
the commenter believes that the number of estimated hours is too low. 
In this request, the commenter suggested that it is possible that no 
taxpayers will ever incur a section 5000D tax liability. The commenter 
accepted that the Treasury Department and the IRS do not have 
historical data on the number of compliance hours affected taxpayers 
may experience if a section 5000D tax liability is incurred and did not 
offer a specific estimated number of hours it views as more accurate 
than the estimate provided in the proposed regulations. Similarly, the 
commenter did not offer an alternative calculation methodology that the 
Treasury Department and the IRS could use to provide a better burden 
estimate.
    The Treasury Department and the IRS calculated the estimated number 
of paperwork burden hours using the long-standing and established 
methodology outlined in Publication 5743, Taxpayer Compliance Burden, 
to arrive at the estimated total annual reporting burden of 1,380 hours 
stated in the proposed regulations. For these reasons, the Treasury 
Department and the IRS estimate that this Treasury decision will impose 
a total annual reporting burden of 1,380 hours, as discussed in part II 
of the Special Analyses section of this preamble. However, the Treasury 
Department and the IRS will regularly examine and, as necessary, update 
the estimated total annual reporting burden of this Treasury decision 
as required by the PRA.

B. Regulatory Flexibility Act

    A commenter requested that the Treasury Department and the IRS 
conduct a Regulatory Flexibility Act (5 U.S.C. chapter 6) (RFA) 
analysis because the commenter is concerned that this Treasury decision 
may have an indirect effect on small entities. An agency may properly 
certify that no RFA analysis is needed when it determines that a rule 
will not have a significant economic impact on a substantial number of 
small entities that are subject to the requirements of the proposed 
rule. See Mid-Tex Elec. Co-op., Inc. v. FERC, 773 F.2d 327, 342 (D.C. 
Cir. 1985) (holding that Congress did not intend to require 
consideration of every indirect effect that any regulation might have 
on small businesses). Accordingly, as discussed in part III of the 
Special Analyses section of this preamble, the Treasury Department and 
the IRS continue to certify that this Treasury decision will not create 
additional obligations for, or impose a significant economic impact on, 
small entities, and as a result, a regulatory flexibility analysis 
under the RFA is not required.

Special Analyses

I. Regulatory Planning and Review--Economic Analysis

    Pursuant to the Memorandum of Agreement, Review of Treasury 
Regulations under Executive Order 12866 (June 9, 2023), tax regulatory 
actions issued by the IRS are not subject to the requirements of 
section 6 of Executive Order 12866, as amended. Therefore, a regulatory 
impact assessment is not required.

II. Paperwork Reduction Act

    The collection of information contained in these final regulations 
has been reviewed and approved by the Office of Management and Budget 
in accordance with the PRA under control number 1545-0023.
    The collections of information in these regulations relate to 
reporting and recordkeeping requirements that will allow taxpayers to 
meet their tax reporting obligations. The collections of information 
would generally be used by the IRS for tax compliance purposes and by 
taxpayers to facilitate proper tax reporting and compliance. The 
reporting and recordkeeping requirements are covered within the form 
and instructions for Form 720.
    Because the section 5000D tax is a new tax that has never been 
reported to the IRS, the Treasury Department and the IRS do not have 
historical data on the number of affected taxpayers. The Centers for 
Medicare and Medicaid Services (CMS) has selected 10 drugs for price 
negotiation for initial price applicability year 2026. CMS will select 
for negotiation a limited number of drugs for each initial price 
applicability year after that, as outlined in the IRA. Further, 
manufacturers, producers, or importers of such drugs may or may not 
become subject to a section 5000D tax liability. Based on the 
foregoing, the IRS estimates that there will be between 0 and 50 
taxpayers during the next 3 years.
    If a taxpayer has a section 5000D tax liability, it would be 
required to file Form 720 to report such liability. Form 720 is a 
quarterly return. A taxpayer would only be required to file Form 720 
during calendar quarters in which the taxpayer has a section 5000D tax 
liability. Therefore, a taxpayer that has a section 5000D tax liability 
in one calendar quarter but not in subsequent calendar quarters would 
only be required to file one Form 720.
    The respondents with regard to the section 5000D tax are 
manufacturers, producers, or importers of certain drugs. The Treasury 
Department and the IRS estimate the annual burden of the collections of 
information as follows (these estimates, which are for PRA purposes 
only, are based on the high end of the range of possible taxpayers and 
the high end of the range of the frequency of responses, in which a 
taxpayer would have tax liability in all four calendar quarters):
    Estimated frequency of responses: Quarterly.

[[Page 55510]]

    Estimated number of responses: 50.
    Estimated burden time per respondent: 6.9 hours.
    Estimated total annual reporting burden: 1,380 hours.
    A Federal agency may not conduct or sponsor, and a person is not 
required to respond to, a collection of information unless the 
collection of information displays a valid control number assigned by 
OMB. Books or records relating to a collection of information must be 
retained if their contents may become material in the administration of 
any internal revenue law. Generally, tax returns and tax return 
information are confidential, as required by section 6103.
    The Treasury Department and the IRS received a comment suggesting 
that the paperwork burden estimate provided in the proposed regulations 
was too low. However, for the reasons discussed in detail in the 
Summary of Comments and Explanation of Revisions section of this 
preamble and in this Special Analyses section, the Treasury Department 
and the IRS have not changed the estimates provided herein.

III. Regulatory Flexibility Act

    For the reasons discussed in detail in the Summary of Comments and 
Explanation of Revisions section of this preamble and in this Special 
Analyses section, pursuant to the RFA, it is hereby certified that 
these final regulations will not have a significant economic impact on 
a substantial number of small entities. This certification is based on 
the fact that the section 5000D tax is imposed only on certain sales by 
manufacturers, producers, or importers of designated drugs during 
periods described in section 5000D(b). The periods described in section 
5000D(b) relate to milestones in the Medicare Drug Price Negotiation 
Program, which involve only certain drugs with high Medicare 
expenditures. Drugs with high Medicare expenditures that are not 
already excluded from the Medicare Drug Price Negotiation Program under 
an exception such as the SSA's small biotech exception (sections 
1192(b) and (d)(2) of the SSA) are likely to be manufactured, produced, 
or imported by large entities, so if any section 5000D tax liability 
arises, an insubstantial number of taxpayers will be small entities. As 
noted earlier, data is not available about the number of taxpayers 
affected, but the number is likely to be limited, in part due to the 
limited number of drugs selected for the Medicare Drug Price 
Negotiation Program in any particular year. In addition, these final 
regulations will assist taxpayers in meeting their tax reporting 
obligations by providing clarity on how to report section 5000D tax 
liability, which will make it easier for taxpayers to comply with 
section 5000D. Therefore, these final regulations will not create 
additional obligations for, or impose a significant economic impact on, 
small entities, and a regulatory flexibility analysis under the RFA is 
not required.

IV. Section 7805(f)

    Pursuant to section 7805(f) of the Code, the notice of proposed 
rulemaking preceding these final regulations was submitted to the Chief 
Counsel for the Office of Advocacy of the Small Business Administration 
for comment on its impact on small business. No comments were received 
from the Chief Counsel for the Office of Advocacy of the Small Business 
Administration.

V. Unfunded Mandates Reform Act

    Section 202 of the Unfunded Mandates Reform Act of 1995 requires 
that agencies assess anticipated costs and benefits and take certain 
other actions before issuing a final rule that includes any Federal 
mandate that may result in expenditures in any one year by a State, 
local, or Tribal government, in the aggregate, or by the private 
sector, of $100 million in 1995 dollars, updated annually for 
inflation. These final regulations do not include any Federal mandate 
that may result in expenditures by State, local, or Tribal governments, 
or by the private sector, in excess of that threshold.

VI. Executive Order 13132: Federalism

    Executive Order 13132 (Federalism) prohibits an agency from 
publishing any rule that has federalism implications if the rule either 
imposes substantial, direct compliance costs on State and local 
governments, and is not required by statute, or preempts State law, 
unless the agency meets the consultation and funding requirements of 
section 6 of the Executive order. These final regulations do not have 
federalism implications, do not impose substantial direct compliance 
costs on State and local governments, and do not preempt State law 
within the meaning of the Executive order.

Statement of Availability of IRS Documents

    The IRS Notice cited in this preamble is published in the Internal 
Revenue Bulletin and is available from the Superintendent of Documents, 
U.S. Government Publishing Office, Washington, DC 20402, or by visiting 
the IRS website at https://www.irs.gov.

Drafting Information

    The principal author of these regulations is Jacob W. Peeples of 
the Office of the Associate Chief Counsel (Passthroughs & Special 
Industries). However, other personnel from the Treasury Department and 
the IRS participated in their development.

List of Subjects

26 CFR Part 40

    Excise taxes, Reporting and recordkeeping requirements.

26 CFR Part 47

    Excise taxes.

Adoption of Amendments to the Regulations

    Accordingly, the Treasury Department and the IRS amend 26 CFR 
chapter I, subchapter D, as follows:

PART 40--EXCISE TAX PROCEDURAL REGULATIONS

0
Paragraph 1. The authority citation for part 40 continues to read in 
part as follows:

    Authority:  26 U.S.C. 7805.
* * * * *

0
Par. 2. Section 40.0-1 is amended by revising paragraphs (a) and (e) to 
read as follows:


Sec.  40.0-1  Introduction.

    (a) In general. The regulations in this part are designated the 
Excise Tax Procedural Regulations. The regulations in this part set 
forth administrative provisions relating to the excise taxes imposed by 
chapters 31 through 34, 36, 38, 39, 49, and 50A of the Internal Revenue 
Code (Code) (except for the chapter 32 tax imposed by section 4181 
(firearms tax) and the chapter 36 taxes imposed by sections 4461 
(harbor maintenance tax) and 4481 (heavy vehicle use tax)), and to 
floor stocks taxes imposed on articles subject to any of these taxes. 
Chapter 31 relates to retail excise taxes; chapter 32 to manufacturers' 
excise taxes; chapter 33 to taxes imposed on communications services 
and air transportation services; chapter 34 to taxes imposed on certain 
insurance policies; chapter 36 to taxes imposed on transportation by 
water; chapter 38 to environmental taxes; chapter 39 to taxes imposed 
on registration-required obligations; chapter 49 to taxes imposed on 
indoor tanning services; and chapter 50A to taxes imposed on the sale 
of designated drugs. References in this part to taxes also include 
references to the fees imposed by sections 4375 and 4376 of the Code. 
See parts 43, 46 through 49,

[[Page 55511]]

and 52 of this chapter for regulations related to the imposition of 
tax.
* * * * *
    (e) Applicability dates--(1) Paragraph (a). Paragraph (a) of this 
section applies to returns required to be filed under Sec.  40.6011(a)-
1 for calendar quarters beginning on or after October 1, 2023. For 
rules that apply before October 1, 2023, see 26 CFR part 40, revised as 
of April 1, 2024.
    (2) Paragraphs (b) and (c). Paragraphs (b) and (c) of this section 
apply to returns for calendar quarters beginning after March 31, 2013. 
For rules that apply before March 31, 2013, see 26 CFR part 40, revised 
as of April 1, 2012.
    (3) Paragraph (d). Paragraph (d) of this section applies to returns 
for calendar quarters beginning on or after January 19, 2021. For rules 
that apply before January 19, 2021, see 26 CFR part 40, revised as of 
April 1, 2020.

0
Par. 3. Section 40.6011(a)-1 is amended by:
0
1. Revising the first sentence of paragraph (a)(2)(i).
0
2. Adding paragraphs (d) and (e).
    The revision and additions read as follows:


Sec.  40.6011(a)-1   Returns.

    (a) * * *
    (2) * * *
    (i) * * * Except as provided in paragraphs (b) through (d) of this 
section, the return must be made for a period of one calendar quarter. 
* * *
* * * * *
    (d) Tax on the sale of designated drugs. A return that reports 
liability imposed by section 5000D of the Internal Revenue Code must be 
made for a period of one calendar quarter. A return must be filed for 
each calendar quarter in which liability for the tax imposed by section 
5000D is incurred. There is no requirement that a return be filed for a 
calendar quarter in which there is no liability imposed by section 
5000D.
    (e) Applicability dates--(1) Paragraph (a)(2)(i). Paragraph 
(a)(2)(i) of this section applies to returns filed for calendar 
quarters beginning on or after October 1, 2023. For rules that apply 
before October 1, 2023, see 26 CFR part 40, revised as of April 1, 
2024.
    (2) Paragraph (c). See paragraph (c)(2) of this section.
    (3) Paragraph (d). Paragraph (d) of this section applies to returns 
filed for calendar quarters beginning on and after October 1, 2023.

0
Par. 4. Section 40.6302(c)-1 is amended by:
0
1. Revising paragraphs (e)(1)(iv) and (v).
0
2. Adding paragraph (e)(1)(vi).
0
3. Revising paragraph (f).
    The revisions and addition read as follows:


Sec.  40.6302(c)-1  Deposits.

* * * * *
    (e) * * *
    (1) * * *
    (iv) Sections 4375 and 4376 (relating to fees on health insurance 
policies and self-insured insurance plans);
    (v) Section 5000B (relating to indoor tanning services); and
    (vi) Section 5000D (relating to the sale of designated drugs).
* * * * *
    (f) Applicability dates--(1) Paragraphs (a) through (d). Paragraphs 
(a) through (d) of this section apply to deposits and payments made 
after March 31, 2013. For rules that apply before March 31, 2013, see 
26 CFR part 40, revised as of April 1, 2013.
    (2) Paragraph (e). Paragraph (e) of this section applies to 
calendar quarters beginning on or after October 1, 2023. For rules that 
apply before October 1, 2023, see 26 CFR part 40, revised as of April 
1, 2024.

0
Par. 5. Add part 47 to read as follows:

PART 47--DESIGNATED DRUGS EXCISE TAX REGULATIONS

Sec.
47.5000D-0 Table of contents.
47.5000D-1 Introduction.
47.5000D-2--47.5000D-4 [Reserved]

    Authority:  26 U.S.C. 7805.
    Section 47.5000D-1 also issued under 26 U.S.C. 5000D.


Sec.  47.5000D-0  Table of contents.

    This section lists the table of contents for Sec. Sec.  47.5000D-1 
through 47.5000D-4.

Sec.  47.5000D-1 Introduction.

    (a) In general.
    (b) Applicability date.


Sec. Sec.  47.5000D-2--47.5000D-4  [Reserved]


Sec.  47.5000D-1  Introduction.

    (a) In general. The regulations in this part are designated the 
Designated Drugs Excise Tax Regulations. The regulations in this part 
relate to the tax imposed by section 5000D of the Internal Revenue 
Code. See part 40 of this chapter for regulations relating to returns, 
payments, and other procedural rules applicable to this part.
    (b) Applicability date. This section applies to returns filed for 
calendar quarters beginning on or after October 1, 2023.


Sec. Sec.  47.5000D-2--47.5000D-4  [Reserved]

Douglas W. O'Donnell,
Deputy Commissioner.
    Approved: June 24, 2024.
Aviva R. Aron-Dine,
Acting Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2024-14706 Filed 7-3-24; 8:45 am]
BILLING CODE 4830-01-P