Wholesalers Removing Taxpaid or Tax Determined Wine– Claims for Drawback of Tax
The following addresses the most pertinent regulatory requirements pertaining to wholesalers withdrawing taxpaid or tax determined wine from a bonded wine premise for:
- Exportation;
- Use as supplies for vessels and aircraft;
- Transfer to a foreign trade zone;
- Shipment to the U.S. armed forces for use overseas.
The regulations pertaining to the production of wine are contained in part 24 of Title 27 of the Code of Federal Regulations (CFR), while those pertaining to the exportation of alcohol are contained in 27 CFR part 28. For the complete and regularly updated set of export regulations, please visit e-CFR.
Wholesaler’s basic permit requirement.
Anyone other than a qualified proprietor of a bonded wine cellar who plans to engage in the business of exporting taxpaid wine out of the United States must first obtain a basic permit under the Federal Alcohol Administration Act (FAA Act). The FAA Act requires that anyone purchasing alcohol beverages for resale at wholesale, either domestically or in foreign commerce, to first obtain a Wholesaler's Basic Permit before commencing business. The application for this permit can be filed using our Permits Online system. All permit applicants must qualify under the provisions of 27 CFR Part 1.
Authorized exportation of taxpaid or tax determined wine.
The provisions of 27 CFR 28.211 provide that taxpaid or tax determined wine produced in the United States may be:
- Exported to a foreign country;
- Used as supplies on the vessels and aircraft described in 27 CFR 28.21; and
- Transferred to and deposited in a foreign-trade zone for exportation or storage pending exportation.
The provisions of 27 CFR 28.243 provide for the shipment of taxpaid wine to the U.S. armed forces for use overseas.
Export marks.
In addition to the labeling requirements prescribed in 27 CFR part 24,
27 CFR 28.216 requires that the exporting wholesaler mark the word "Export" on each container or case of wine before removal for export, for use on vessels or aircraft, or for transfer to a foreign-trade zone.
Drawback notice and claim for taxpaid wine.
To obtain a refund of excise tax paid on wine that has been exported, or otherwise removed as listed above, wholesalers must file TTB F 5120.24, "Drawback on Wines Exported," in accordance with the instructions on that form.
For exportations and transfers to foreign-trade zones, the regulations in
27 CFR 28.214 require that TTB F 5120.24 be prepared in quadruplicate and given a serial number beginning with "1" for the first day of January of each year and running consecutively thereafter through December 31.
For transfers as supplies on vessels and aircraft, the regulations in § 28.214 require that TTB F 5120.24 be prepared in quadruplicate with an additional copy marked "Consignee’s Copy", and given a serial number beginning with "1" for the first day of January of each year and running consecutively thereafter to December 31.
See 27 CFR 28.218 for instruction on where to send copies of TTB F 5120.24.
Certificate of tax determination.
In conjunction with filing TTB F 5120.24, wholesalers must file a certificate of tax determination on TTB F 5120.20, "Certificate of Tax Determination – Wine", as provided in § 28.215. Complete Part I and Part II of the form and obtain the certification of tax payment from the bonded wine premises proprietor who paid the excise tax on the wine; have the proprietor who withdrew the wine from bond complete Part III, and submit the completed certificate with the claim.
Proof of exportation.
Wholesalers must also submit with the claim appropriate and acceptable proof of exportation, which may vary depending on the purpose and final destination of the product. Acceptable proof of exportation is listed in regulations found at
27 CFR 28.40 and 28.41.
Export certificates.
For information on other export certificates that may be required for exports to certain countries (e.g. Certificate of Free Sale), please visit our Export Documents page.
TTB G: 2010-15
OPR: ITD
Oct. 06, 2010