How to File IRS Form 8519-E for Excise Taxes

Federal excise taxes are levied on the sale of certain goods by manufacturers, producers, and importers, with the revenue often dedicated to specific national interests. For manufacturers and importers of sport fishing and archery equipment, these taxes are reported using IRS Form 720, the Quarterly Federal Excise Tax Return. The revenue generated from these specific taxes is directed toward conservation and the enhancement of fish and wildlife habitats, primarily under the authority of the Dingell-Johnson Sport Fish Restoration Act.

Determining Filing Requirements

A business must file Form 720 if it is a manufacturer, producer, or importer that sells sport fishing or archery equipment subject to federal excise tax. For tax purposes, a manufacturer is the entity that produces a finished, taxable article from raw materials or by combining components. This also includes any importer who brings taxable goods into the United States for sale or use.

Taxable sport fishing equipment includes items such as fishing rods and poles, reels, and creels. It also covers artificial lures, baits, and flies, along with specialized gear like fish stringers and tackle boxes. A 3% tax rate applies to the sale of electric outboard motors. For archery, the tax applies to bows with a peak draw weight of 30 pounds or more, as well as their parts and accessories. Arrows measuring 18 inches or more in length are also subject to this excise tax.

Information and Calculations for Form 720

Before filing, a business must gather its legal name, address, and Employer Identification Number (EIN) and identify the calendar quarter for the return. Form 720 is a comprehensive return that covers many types of excise taxes, so filers must complete the lines relevant to their products in Part I, Manufacturers Taxes.

The tax on most sport fishing equipment is 10% of the sale price. The tax on fishing rods and poles is 10% of the sale price, but it is capped at a maximum of $10 per item. The tax on archery equipment, including taxable bows, their components, and arrows, is 11% of the manufacturer’s sale price.

For example, if a manufacturer sells a taxable bow to a retailer for $500, the excise tax is $55 ($500 x 11%). The total tax due for the quarter is the sum of the calculated taxes for all individual sales of taxable equipment during that period.

The Filing and Payment Process

Form 720 can be filed either electronically or by mail. Businesses can file Form 720 electronically through an IRS-approved e-file provider. This method is generally faster and ensures receipt by the IRS. Alternatively, a business can mail its completed paper Form 720 to the address listed in the form’s instructions.

Tax payments are handled electronically. The most common method is through the Electronic Federal Tax Payment System (EFTPS), a free service from the U.S. Department of the Treasury. Filers can also use IRS Direct Pay to make payments from a business bank account. Complete the payment by the filing deadline to avoid potential penalties and interest.

Filing Deadlines and Recordkeeping

Businesses must file Form 720 quarterly. The due date for the return is the last day of the month following the end of the calendar quarter.

• First Quarter (Jan–Mar): Due April 30
• Second Quarter (Apr–Jun): Due July 31
• Third Quarter (Jul–Sep): Due October 31
• Fourth Quarter (Oct–Dec): Due January 31

Businesses must maintain thorough and accurate records to support all figures on the tax return. This documentation should include detailed invoices, records of sale prices, and worksheets detailing tax calculations. These records must be retained for at least three years from the date the tax was due or paid, whichever is later, and be available for IRS inspection.