TAX FILE: When a pickup is a tractor

Sept. 1, 2004
The 12% tax applies to trucks with a gross vehicle weight rating exceeding 33,000 lb., as well as to all tractors. For years, there has been uncertainty as to whether large pickup trucks that are modified to tow long trailers are taxable as tractors or nontaxable trucks. Now the IRS has ruled that one type of vehicle is taxable. In Revenue Ruling 2004-80, issued July 28, the IRS described a four-door

The 12% “retail” tax applies to trucks with a gross vehicle weight rating exceeding 33,000 lb., as well as to all tractors. For years, there has been uncertainty as to whether large pickup trucks that are modified to tow long trailers are taxable as tractors or nontaxable trucks.

Now the IRS has ruled that one type of vehicle is taxable. In Revenue Ruling 2004-80, issued July 28, the IRS described a four-door crew-cab pickup outfitted with “certain luxury features.” The cab has an electric trailer brake control and three types of hitches. When towing a trailer, the only onboard carrying capacity is a pair of storage boxes behind the cab. The IRS ruled that these modifications make the vehicle a tractor and, consequently, subject to the 12% tax.

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KEN SIMONSON

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