Material & Disbursement Services (MSD)
POLICY 45
Effective Date: 07/01/1992
Last Modified Date: 11/19/2003
Permitted Uses
The procurement and use of tax-free ethyl alcohol is authorized by a special permit granted to the University by the U.S. Treasury Department, Internal Revenue Service. The permit recognizes the following authorized uses:
- preserving specimens of anatomy, biology, and natural history
- general reagent work in chemical laboratories
- research and laboratory work in the Medical School, School of Dentistry, and School of Pharmacy, as well as other research laboratories
- patient care and laboratory uses incidental to the care of patients both at Student Health Services and in the Hospitals
Ethyl alcohol cannot be used for any purposes other than those listed on the permit.
Handling
The following controls are placed on the handling of tax-free alcohol.
- Tax-free alcohol must never be sold.
- Tax-free alcohol must never be used in the manufacture of food flavors, flavoring extract, food products, or beverages.
- Tax-free alcohol must not be used as a cleaning agent in repair work and machine shops.
- Tax-free alcohol cannot be loaned to another person or institution, even if such person or institution is also authorized to use tax-free alcohol.
- Tax-free alcohol cannot be sold or issued to doctors for use in private practice, even if these services are performed in the hospital.
- Tax-free alcohol must be used on the premises named in the permit (The University of North Carolina at Chapel Hill).
- Research laboratories authorized to use tax-free alcohol in pure research must discontinue using tax-free alcohol when the research program is completed or discontinued.
Source of Regulations
Those agencies or departments of the University that need tax-free alcohol for the formulation of medicines or products should become familiar with all the regulations issued in IRS Publication No. 444 (9-60), "Distributing and Use of Tax-free Alcohol."
Federal Audits
The Director of Material & Disbursement Services is designated by the University's Board of Trustees as the curator of all tax-free ethyl alcohol used at Carolina. All alcohol releases are checked at least annually by Federal auditors for strict compliance to the permit as well as for quantities used. The auditors not only check the issue records but may also check the supplies of the using departments.
Storage
Ethyl alcohol is requisitioned from the Scientific Supply Room. Only the quantity that is expected to be used over a short duration of time (daily or, at most, weekly) can be released. Any unused alcohol should be secured so that only authorized persons will have access to it.
Additional Information
See also: MSD Procedure 24, Ethyl Alcohol Regulations
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