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TTB Extends and Expands Alternate Procedure for Claiming New Federal Excise Tax Credit

WASHINGTON, D.C. — TTB announced today (Industry Circular 2018-1A) that it is expanding and extending the “alternate procedure” through Dec. 31, 2019 to allow wineries to claim the full value of the new federal excise tax credit on wine stored at bonded wine cellars or other wineries.

“This will provide wineries with greater clarity and certainty, enabling them to claim the full value of the new credit,” said Robert P. (Bobby) Koch, President and CEO of Wine Institute. The new expanded credit was enacted last December as part of the two-year Craft Beverage Modernization and Tax Reform Act. “We want to thank the TTB for this positive action and acknowledge the work by Members of Congress who encouraged this action.”

The “alternate procedure” is needed based on TTB’s determination that the new law does not allow for the transferability of the credit during this two-year period. Many wineries use fulfillment houses, custom crush facilities and bonded wine warehouses to store their wine, and the strict interpretation of the bill disallowed these facilities from claiming the credit.

Wine Institute has worked since 2015 to pass the Craft Beverage legislation (H.R. 747/S. 236) which saves California wineries more than $70 million annually in excise tax reductions. Over 300 Representatives and 55 Senators signed on to sponsor the bill, which was introduced by Sen. Ron Wyden (D-OR) and Sen. Roy Blunt (R-MO). Sen. Rob Portman (R-OH) offered the amendment that added the Craft Beverage bill to the broader tax reform legislation.

Wine Institute is continuing to work with a broad coalition of industry groups to extend the provisions of the CBMTRA beyond Dec. 31, 2019.

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