Federal Excise Tax (Spirits)
The federal excise tax on distilled spirits is a per-proof-gallon tax owed when spirits are removed from bond, reported to the TTB on the semi-monthly excise return (Form 5000.24).
Under the Craft Beverage Modernization Act (CBMA), reduced rates apply to the first tiers of production each calendar year, so a producer's effective rate rises as annual volume grows. Calculating the tax correctly means applying those tiers cumulatively across the year, on the proof gallons actually removed.
When is the spirits excise tax owed?
The tax is determined when spirits are removed from bond and is reported on the excise return (TTB F 5000.24). For semi-monthly filers the return is generally due by the 14th day after the return period closes, and unusually, if that day is a weekend or holiday it moves to the preceding business day (27 CFR 19.235, eCFR Title 27).
How is the spirits excise tax calculated?
Multiply the proof gallons removed by the applicable CBMA rate for your cumulative volume that calendar year. Our excise tax calculator applies the current tiers, and a distillery system should apply them automatically so accruals stay correct as volume grows.
Related
See your distillery in Spirit Sight
Book a walkthrough with our team. We’ll show your operation - barrels, TTB, and the books - in one place.
Schedule a Demo