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product of the number of gallons of
gasoline so used multiplied by the rate
at which tax was imposed on such
gasoline by section 4081.
(2) Limitation in case of
nonscheduled intercity or local
buses.--Paragraph (1)(A) shall not apply
in respect of gasoline used in any
automobile bus while engaged in
furnishing transportation which is not
scheduled and not along regular routes
unless the seating capacity of such bus
is at least 20 adults (not including the
driver).
Petitioners argue that they would be entitled to a payment
under section 6421(b)(1)(A) and therefore entitled to claim an
income tax credit under section 34(a)(2). Respondent contends
that petitioners do not meet the requirements for claiming a
payment under section 6421(b)(1)(A).
There are three essential elements to a claim for payment
under section 6421(b)(1)(A) in situations (like this one) where
the seating capacity of each vehicle is fewer than 20 adults. A
taxpayer must establish that the excise tax was paid on gasoline
(1) used in an automobile bus, (2) while engaged in furnishing
(for compensation) passenger land transportation available to the
general public, and (3) which was scheduled along regular routes.
See sec. 6421. We shall address these elements separately.
II. “Automobile Bus” Requirement
Petitioners argue that the vans and 4-door sedans used to
transport passengers qualify as “buses”. Whether a sedan or van
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