Beebe: Perihelion waiting for IRS review
Published 11:37 pm Wednesday, September 17, 2008
Production remains at a standstill at Perihelion Global Inc.’s Opp biodiesel plant as the facility awaits a visit from an IRS field examiner to complete a mandated process.
Dan Boone, IRS media specialist for Alabama and Tennessee, said companies who produce biodiesel are required to obtain a excise tax certification using Form 637 for Excise Tax Registration.
“We do mandate that a field examiner visits the facility and inspects the facility prior to the dispersal of any fuel produced,” Boone said. “Typically we try to process the registration within 60 days, but there can be some delays. If the paperwork was not filed properly or clarifications were needed, then it could delay the completion of the process.”
Boone said he could not discuss any specific cases due to disclosure laws, but could confirm that selling fuel without proper registration would be a violation of federal law.
Perihelion Global CEO John Beebe said Perihelion has completed a large portion of the registration process and is awaiting a site visit from a field agent to complete certification.
“To our understanding, Perihelion has passed the requirements for IRS certification to date and are currently awaiting an on-site visit for review and enrollment by an IRS excise tax field agent,” Beebe said. “The IRS has not committed a date at this time as to when an excise tax field agent will meet with us at the facility for certification. Perihelion is not the subject of an audit or other outstanding issue with the IRS to our knowledge.
“Perihelion is legally prohibited under federal law from selling biodiesel until we have received the excise tax certification from the IRS,” he added. “Since Perihelion cannot legally sell the biodiesel we have produced to date, we cannot afford to have the refinery producing fuel and staffed when we cannot sell biodiesel to generate revenue to offset expenses.”
Beebe said that if Perihelion sold any fuel prior to completing the excise tax registration process, then the IRS would administer a $10,000 initial fine.
In the article titled “Beebe: Perihelion will meet production deadline” printed in the Fri., Sept. 12, edition of The Star-News, Beebe was incorrectly quoted as stating that Perihelion had requested that utilities be cut off at the Opp plant.
In an earlier interview Wesley Laird, attorney for the city of Opp, had stated that utilities were cut off at Perihelion’s Opp plant. Beebe stated that the city of Opp requested a security deposit when Perihelion sought to make its last utility payment.
“Perihelion is current in its lease payments to the city of Opp and was recently asked by the city to place an additional security deposit for utilities at the refinery when we sought to make our last utility payment,” Beebe said. “While Perihelion can currently produce substantial quantities of biodiesel at our Opp facility, we face logistical operational constraints and will not be able to produce the number of jobs initially anticipated due to the present lack of infrastructure (rail, sewer and roads) to support the larger project on the property.”