The U.S. Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB) issued a release that includes a set of “frequently asked questions” (FAQs) regarding the destruction of un-merchantable beer and recovery of taxes paid, including the waiver of certain requirements for beer destructions and using beer to make hand sanitizer at a distillery. The FAQs provide guidance in response to the coronavirus (COVID-19) pandemic.
As explained in a related TTB release (May 1, 2020), because of the business disruptions facing brewers as a result of COVID-19, TTB is waiving the requirement that brewers submit to TTB a “Notice of Intent” to destroy tax-paid beer in the marketplace—thereby alleviating the 12-day waiting period required under TTB regulations. This waiver extends through July 1, 2020.
TTB also stated that regarding available options for un-merchantable tax-paid beer that is currently in the marketplace or at a wholesaler, the disposal of such beer that is not returned to the brewer is considered a destruction off brewery premises and is authorized under existing regulations. This includes beer in kegs that may be destroyed by a wholesaler on the brewer’s behalf, as well as the transfer of tax-paid beer to a distilled spirits plant, which the distillery may use in the production of hand sanitizer.
Read TTB’s beer destruction FAQs for additional details including recordkeeping requirements and filing claims to recover taxes paid under this alternate procedure.
For more information, contact a tax professional with KPMG’s Excise Tax Practice group:
Taylor Cortright | +1 (202) 533 6188 | firstname.lastname@example.org
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