Frequently Asked Questions
TTB Form 5110.40


The TTB Form 5110.40 in this tutorial has been enhanced to provide links to frequently asked questions (FAQ) about various areas of the form.

To display the FAQ information for a relevant section, simply roll over the desired section/field.

To access the form, click the Form link on the left or click here.

Section A Bulk Wines

What is a proof gallon and how do I convert regular gallons to proof gallons?

A proof gallon is one liquid gallon of spirits that is 50% alcohol at 60 degrees F. Distilled Spirits* bottled at 80 proof (40% alcohol) would be 0.8 proof gallons per gallon of liquid. At 125 proof, a gallon of liquid would be 1.25 proof gallons. In the industrial and fuel industries, most alcohol is at 190 or 200 degrees of proof. One gallon of alcohol that is 200 proof is equal to 2.0 proof gallons. Refer to 27 CFR Part 19 and 27 CFR Part 30 concerning procedures for determining proof, gauging spirits to determine quantity by weight or volume, or other procedures and regulations concerning measurement of alcohol.

*(also known in beverage and industrial or fuel industries as alcohol or ethanol)

Do I fill out my reports in proof gallons or regular gallons?

Three of the required monthly operational reports submitted by a Distilled Spirits Plant (Forms 5110.40 – Production; 5110.11 – Storage; F 5110.28 – Processing) are completed using proof gallons. The fourth report – Form 5110.43 – Processing (Denaturing) – is completed in wine gallons (regular US liquid gallons).

All denatured alcohol and articles manufactured from denatured alcohol are shown in records and reports in wine gallons. Line 11 of Form 5110.28, Used for Denaturation, is expressed in proof gallons. The corresponding line 2 of the Form 5110.43, Produced (denatured spirits) is expressed in wine gallons – it reflects the net quantity of wine gallons of spirits, plus added denaturing materials reflected in the finished denatured alcohol product.

I am approved for particular types of operations on my permit, how do I know what reports to file?

All plants must be qualified as a warehouseman or distiller, in addition to any processing operations. Your actual operations and the way that you move spirits between and within your production, storage and processing accounts determine how you report your activity.

  • Form TTB F 5110.40 (Monthly Report of Production Operations) – You must file this report if distilling/production operations appear on your DSP permit and registration.
  • Form TTB F 5110.11 (Monthly Report of Storage Operations) – You must file this report to report storage account activity at a beverage or industrial DSP.  You must file this report if the operation of warehouseman appears on your DSP permit and registration.
  • Form TTB F 5110.28 (Monthly Report of Processing Operations) – You must file this report if you conduct processing (rectifying), bottling, packaging, or denaturing operations at your DSP.
  • Form TTB F 5110.43 (Report of Processing (Denaturing) Operations) – You must file this report if you report monthly denaturing activity conducted by industrial DSPs that are authorized to denature spirits and/or manufacture articles.  
What if I am not doing all the operations that were approved on my permit? Do I still need to file the reports that correspond to that type of operation?

Yes. You must file the reports even though you do not currently have any reportable activity. However, if your inactivity will be for an extended period of time, you may request a variance from regulations allowing you to defer filing until such time as you engage in reportable operations for one of the reports. For example, if you are qualified as a warehouseman and processor, and your style of operations does not currently involve storage of spirits in bulk (spirits are entered into processing account upon receipt at your plant) you may obtain approval from TTB to defer filing of storage reports until you begin storing spirits. Such approvals are granted on a case-by-case basis.

What is a 5010 credit and how do I compute?

Under 26 U.S.C. 5001 and 7652 a tax is imposed on all spirits produced in or imported into the United States at $13.50 per proof gallon. Wines containing more than 24 percent of alcohol by volume are taxed as spirits. A credit against this tax is allowed under 26 U.S.C. 5010 on each proof gallon of alcohol derived from eligible wine or eligible alcohol-containing flavors which do not exceed 2.5 percent of the finished product on a proof gallon basis.

Eligible wines are other than standard (OTS) wines that have not been subject to distillation at a distilled spirits plant and that contain no more than 0.392 g of carbon dioxide per 100 ml. Eligible flavors are those that have been approved by the Nonbeverage Products Laboratory. The producers or importers of distilled spirits are eligible for this credit if the distilled spirits contain an eligible wine and/or eligible flavor used in producing a batch of spirits produced in accordance with an approved formula.