IRS Form 720-CS Guide: Carrier Summary Statement Rules

1. Introduction – What is Form 720-CS?

IRS Form 720-CS, officially titled Carrier Summary Statement, is an official federal information return governed by the Internal Revenue Service (IRS). It is used by bulk fuel transport carriers to report monthly movements of liquid fuel through pipelines and marine vessels.

Form 720-CS is a key component of the federal Excise Summary Terminal Accounting and Reporting System (ExSTARS). ExSTARS is an automated IRS compliance tracking program created to monitor the national fuel distribution supply chain.

Unlike standard tax returns, Form 720-CS is strictly an information disclosure form. No tax payment is calculated or submitted with Form 720-CS. Instead, it provides the IRS with verifiable data regarding bulk fuel shipments entering, leaving, or moving between terminals and refineries.

2. Purpose of the Form

The primary purpose of Form 720-CS is to track bulk movement of taxable fuels across state lines and transportation networks, preventing fuel tax fraud and fuel bootlegging.

Form 720-CS solves a major federal tax enforcement problem. Federal excise taxes on gasoline, diesel, kerosene, and aviation fuel generate billions in transportation revenue. In the past, untracked bulk shipments created opportunities for tax evasion. Form 720-CS creates a closed-loop audit system by cross-referencing carrier shipping records against fuel terminal operator reports.

Additionally, Form 720-CS establishes supply chain accountability. By matching carrier manifest data with terminal storage logs, the IRS can quickly detect unrecorded fuel removals, mislabeled product codes, and unauthorized tax-free fuel sales.

3. Who Needs to File This Form

Form 720-CS must be completed and filed monthly by commercial bulk transport carriers that transport liquid taxable fuel in bulk across the fuel distribution system.

You must file Form 720-CS if your business operates in either of the following carrier categories:

• Bulk Pipeline Operators: Operators of interstate or intrastate pipelines transporting taxable fuels in bulk between refineries, terminals, or bulk storage facilities (holding Form 637 Registration **Activity Letter I**).
• Bulk Marine Vessel / Barge Operators: Operators of barges, tankers, or waterborne vessels transporting taxable fuel in bulk shipments over navigable waterways (holding Form 637 Registration **Activity Letter J**).

4. Who Is Exempt / Not Required to File

Form 720-CS is restricted strictly to bulk pipeline and marine vessel operators registered under ExSTARS. Most general transportation businesses are exempt.

You are NOT required to file Form 720-CS in the following situations:

• Highway Tanker Trucks: Motor transport companies delivering fuel by highway tanker trucks are excluded from filing Form 720-CS (truck transport is tracked separately via terminal bills of lading).
• Terminal Operators: Operators of fuel storage terminals file **Form 720-TO** (Terminal Operator Statement) instead of Form 720-CS.
• Fuel Position Holders & Buyers: Fuel traders, jobbers, or position holders who own fuel inside terminals but do not operate bulk pipelines or marine barges.
• Retail Gas Stations: Local retail filling stations, convenience stores, and commercial fuel end-consumers.

5. When to File

Form 720-CS is a recurring monthly information return covering bulk fuel movement during a single calendar month.

Review the primary submission timing deadlines:

• Monthly Due Date: Form 720-CS is due on or before the last day of the month following the calendar month covered by the report (for example, the January monthly report is due February 28/29).
• Continuous Monthly Reporting: Registered bulk carriers must file Form 720-CS every month once registered, even if zero bulk fuel movements occurred during a specific month.

6. Where and How to File

Form 720-CS is primarily filed electronically through approved IRS electronic data interchange systems under the ExSTARS program.

High-volume pipeline and vessel carriers are required to submit Form 720-CS electronically using IRS-approved Electronic Data Interchange (EDI) software or approved web portals. Electronic filing provides immediate batch processing and automated receipt validation.

If paper filing is permitted under IRS guidelines, the completed paper Form 720-CS must be mailed directly to the designated IRS Excise Processing Unit address listed in the official form instructions (typically the IRS Center in Cincinnati, OH or Ogden, UT).

7. Step-by-Step Instructions to Fill the Form

Form 720-CS is organized into carrier identification blocks and itemized shipping schedules. Review the breakdown table and section details below.

Schedule / Section	Section Title	Required Information to Disclose
Header	Carrier Identification	Legal company name, EIN, DBA, address, contact person, reporting month/year, and Form 637 Registration Number.
Schedule 15	Bulk Deliveries	Detail bulk deliveries to terminals/refineries: Origin TCN, Destination TCN, Product Code, date, manifest number, and gallons.
Schedule 16	Bulk Receipts	Detail fuel received into the pipeline/vessel system: Origin TCN, Destination TCN, Product Code, and net gallons at 60°F.
Signatures	Carrier Execution	Authorized corporate officer signature and date certifying accuracy under penalties of perjury.

Header – Carrier and Registration Details

Enter the carrier’s full corporate legal name, Employer Identification Number (EIN), physical business address, contact person details, and reporting calendar month/year. Disclose your official IRS **Form 637 Registration Number** and Activity Letter symbol (Activity Letter “I” for pipelines or “J” for vessels).

Schedule 15 & 16 – Tracking Deliveries and Receipts

Itemize every bulk fuel movement during the month. Provide exact technical shipping data:

• Terminal Control Numbers (TCNs): Enter the official IRS 9-character TCN for the origin facility and destination facility.
• IRS Fuel Product Codes: Enter official IRS fuel codes (e.g., Code 065 for gasoline, 167 for low-sulfur diesel, 125 for aviation gasoline, 130 for jet fuel, 228 for biodiesel).
• Manifest & Date Records: Disclose the bill of lading, manifest number, or batch number, alongside the exact delivery date.
• Gross and Net Gallons: State total gross gallons delivered and total **net gallons adjusted to 60° Fahrenheit**.

8. Required Documents/Information Needed Before Filling

Completing Form 720-CS requires detailed operational transport records and facility registration numbers.

Ensure you have the following verification materials ready:

• Form 637 Registration Letter: Official IRS registration letter proving active Activity Letter “I” or “J” registration.
• Terminal Control Numbers (TCNs): Complete list of approved IRS TCN codes for all origin and destination fuel terminals.
• Shipping Manifests & Bills of Lading: Marine barge manifests, pipeline ticket logs, and batch transfer receipts.
• Temperature-Adjusted Gallonage Logs: Metering logs showing gross physical gallons and net temperature-corrected gallons at 60°F.

9. Common Mistakes to Avoid

Errors on Form 720-CS can cause system mismatches in ExSTARS, triggering regulatory audits. Avoid these frequent mistakes:

• Reporting Gross Gallons Only: Failing to report net gallons adjusted to 60° Fahrenheit. The IRS requires net gallonage for supply chain matching.
• Missing or Incorrect TCN Codes: Entering invalid or incomplete 9-character Terminal Control Numbers for origin or destination facilities.
• Confusing Form 720-CS with Form 720-TO: Submitting Form 720-CS for storage terminal operations. Terminal operators must file Form 720-TO.
• Failing to File Monthly Zero Returns: Skipping monthly filings during months where no bulk fuel movements occurred. Carriers must file zero reports if registered.
• Using Incorrect Fuel Product Codes: Mislabeling fuel types (such as listing renewable diesel under standard diesel fuel codes).

10. Penalties for Non-Filing or Errors

Failing to file Form 720-CS or reporting false shipping data carries severe regulatory and financial consequences.

Key penalty risks include:

• Information Return Penalties (IRC Section 6721): Statutory civil penalties ranging from $50 to $290+ per return for late or inaccurate information returns (increasing to 10% of reported values for intentional disregard).
• Revocation of Form 637 Registration: Persistent failure to file Form 720-CS will cause the IRS to revoke the carrier’s Form 637 Registration (Activity Letter I or J), legally barring the carrier from operating in the bulk fuel transport system.
• Regulatory Audits: Unmatched carrier shipping logs trigger immediate IRS field audits of both the carrier and receiving fuel terminals.

11. Related Forms or Schedules

Form 720-CS operates in direct coordination with several core federal excise and fuel tax forms:

• Form 720-TO: Terminal Operator Statement (filed by fuel storage facilities).
• Form 637: Application for Registration (For Certain Excise Tax Activities – Activity Letters I and J).
• Form 720: Quarterly Federal Excise Tax Return (used by fuel owners to pay tax).
• Form 8849: Claim for Refund of Excise Taxes.

12. Frequently Asked Questions

1. What is IRS Form 720-CS?

IRS Form 720-CS is a monthly informational return filed by bulk pipeline and marine vessel carriers to report bulk shipments of taxable fuel under the ExSTARS compliance system.

2. Is any tax paid with Form 720-CS?

No. Form 720-CS is strictly an informational reporting statement. No tax payments are calculated or submitted with this return.

3. Who must file Form 720-CS?

Form 720-CS must be filed by bulk transport pipeline operators (Form 637 Letter I) and bulk marine vessel or barge operators (Form 637 Letter J).

4. What is the difference between Form 720-CS and Form 720-TO?

Form 720-CS is filed by fuel *carriers* moving fuel through pipelines or vessels. Form 720-TO is filed by fuel *terminal operators* storing fuel inside approved terminal racks.

5. What is ExSTARS?

ExSTARS (Excise Summary Terminal Accounting and Reporting System) is an automated IRS electronic database that cross-checks bulk fuel movements to prevent fuel tax evasion.

6. What is the filing deadline for Form 720-CS?

Form 720-CS is due monthly on or before the last day of the calendar month following the month covered by the report.

13. Conclusion

IRS Form 720-CS is a vital regulatory statement for commercial bulk fuel carriers. By providing accurate monthly data on pipeline and marine fuel shipments, carriers support federal supply chain transparency and prevent illegal fuel tax evasion.

To maintain full IRS compliance, secure active Form 637 Activity Letter I or J registration, track temperature-adjusted net gallonage, verify Terminal Control Numbers, submit Form 720-CS monthly via ExSTARS, and retain complete bills of lading in company records.