The National Association of Chemical Distributors (NACD) President and CEO Eric R. Byer released the following statement after the Internal Revenue Service (IRS) released the pre-publication of its notice of proposed rulemaking on the reinstatement of the Superfund Chemical Taxes. Additionally, the IRS has extended temporary penalty relief provided in Notice 2022-15, 2022-18 I.R.B. 1043 through 2023:

“Since 2021, NACD has repeatedly called on the IRS to address the industry’s compliance concerns and ease the tax’s implementation burden through penalty relief and guidance. Chemical distributors have faced significant uncertainty following the reinstatement of the Superfund tax nearly two years ago. Yesterday’s pre-publication of the Superfund tax proposed rule is welcome news for impacted businesses – including chemical distributors – across the nation. NACD applauds the IRS for listening to the concerns of those affected by not only clarifying its guidance, which includes definitions and examples, but also by extending its penalty relief for businesses who have made a good-faith effort to comply with the law. The proposed guidance in the pre-publication will go far in providing chemical distributors, many of which are small businesses, the information they need to incorporate the impacts of the Superfund tax into their business operations. We look forward to working with the IRS as these rules go into effect and we thank Representatives John Moolenaar (R-MI) and Bryan Steil (R-WI) and Senator Shelley Moore Capito (R-WV) for their leadership in calling for much needed guidance.”

This proposal by the IRS comes after multiple requests from NACD to provide additional guidance on the reinstated Superfund tax, including a letter sent on June 24, 2022, a letter sent on August 3, 2022, a letter sent on January 4, 2023, and most recently a letter sent on March 2, 2023.

NACD is carefully reviewing the notice of proposed rulemaking and plans to submit additional comments during the 60-day comment period, which is expected to begin on March 29, 2023.