A bond is a special kind of insurance policy which has three parties, instead of two. If you think about home or car insurance, you (the policyholder) pay the insurance company a premium, and in the event of a financial loss, the insurance company makes you whole. A bond (or surety bond) is also an…
Bottled Spirits Usually Can’t Be Transferred “In-Bond”
Many distilleries are involved in sending/receiving Bottled Spirit via Transfer in Bond. What they may not realize is that they’re running afoul of TTB regulations which have changed multiple times in recent years. This post will summarize the past and current regulations. The Past Prior to 2018, bottled spirits could not be transferred in bond,…
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Controlled Groups and 100,000 PGs/yr
Most distillers are aware of the Craft Producer tax break on the first 100,000 PGs/yr of product removed in a calendar year. When the tax break was first announced in 2018, there were some loopholes that allowed producers to sometimes take advantage of multiple 100,000 PGs/yr allotments. Those loopholes have largely been closed through subsequent…
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COGS Part II – Overhead Allocation under GAAP
For some important background, make sure you’ve read the first blog post in this series, COGS – Why You Should Care and How to Track It. This post’s intended audience is distillery management and accountants/CFOs/controllers. First and foremost, we should define the goal of this exercise. What we’re aiming for is GAAP-compliant books that can…
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Can you “Keg” Ready-to-Drink Cocktails at a Distilled Spirits Plant?
A frequent question from DSPs is how do I record the production and sale/shipment of ready-to-drink (RTD) cocktails in Keg format (e.g. sixtel, corny keg, beer kegs, etc)? The short answer: in the United States, you cannot. The background is usually the same: a cocktail in the Tasting Room becomes popular and turns into a…
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Government Shutdown Possibility Looms -Submit Your Labels, Formulas and Permit Amendments Now
Congress is not expected to pass appropriations bills this month, and a failure to do this will trigger a government shutdown effective on October 1st. Historically, government shutdowns have resulted in TTB pausing their processing of COLA / Label Approvals/Exemptions, Formulas, and Permit Amendments/Applications. Due to this pause, a backlog of submissions is likely to…