Further manufacture: Does the 75% rule apply to dealer-modified used trucks?

May 1, 1998

Mark Sidman

Attorney

We buy used chassis, modify them and resell them. The modifications typically include adding a lift axle and stretching the frame. We have been told that the 75% rule applies to customer-owned chassis; does it also apply when a dealer buys a used truck, modifies the chassis and resells it?

Used Vehicles

Make NTEA your Association today and unlock access to exclusive resources, tools and insights.

Join online

Further manufacturing of used chassis previously subject to FET

From an NTEA member We want to add a piece of equipment (not a body) to a used truck chassis. The used chassis is older than six months and was taxable under Internal Revenue Code (IRC) Section 4051 Federal Excise Tax...

May 6, 2025

Federal Excise Tax (FET) Implications

Excise Tax Enquirer

Is a speed limitation sufficient for the FET off-highway vehicle exception?

From an NTEA member If a vehicle is unable to maintain highway speeds, can it be treated as a so-called “off-highway vehicle” that is not subject to Internal Revenue Code (IRC) Section 4051 Federal Excise Tax (FET)? Not...

February 25, 2025

Federal Excise Tax (FET) Implications

Excise Tax Enquirer

Requirements for excluding the value of used components

From an NTEA member We are producing a new, taxable truck chassis, but may incorporate a couple of relatively minor used parts we have received from various people over the years. When we sell the new chassis to an end...

January 2, 2025

Federal Excise Tax (FET) Implications

Further manufacture: Does the 75% rule apply to dealer-modified used trucks?

Recommended Articles

Further manufacturing of used chassis previously subject to FET

Is a speed limitation sufficient for the FET off-highway vehicle exception?

Requirements for excluding the value of used components