Subpart Z-Paperwork Reduction Act

19.1010 OMB control numbers assigned pursuant to the Paperwork Reduction Act.

AUTHORITY: 19 U.S.C. 81c, 1311; 26 U.S.C. 5001, 5002, 5004-5006, 5008, 5041, 5061, 5062, 5066, 5101, 5111-5113, 5171-5173, 5175, 5176, 5178-5181, 5201-5204, 5206, 5207, 5211-5215, 5221-5223, 5231, 5232, 5235, 5236, 5241-5243, 5271, 5273, 5301, 5311-5313, 5362, 5370, 5373, 5501-5505, 5551-5555, 5559, 5561, 5562, 5601, 5612, 5682, 6001, 6065, 6109, 6302, 6311, 6676, 7510, 7805; 31 U.S.C. 9301, 9303, 9304, 9306. SOURCE: T.D. ATF-198, 50 FR 8464, Mar. 1, 1985, unless otherwise noted.

Subpart A-Scope

§ 19.1 General.

The regulations in this part relate to the location, construction, equipment, arrangement, qualification, and operation (including activities incident thereto) of distilled spirits plants.

§ 19.2 Territorial extent.

This part applies to the several States of the United States and the District of Columbia.

§ 19.3 Related regulations.

Regulations relating to this part are listed below:

27 CFR Part 1-Basic Permit Requirements Under the Federal Alcohol Administration Act.

27 CFR Part 2-Nonindustrial Use of Distilled Spirits and Wine.

27 CFR Part 3-Bulk Sales and Bottling of Distilled Spirits.

27 CFR Part 4-Wine Labeling and Advertising.

27 CFR Part 5-Labeling and Adv Distilled Spirits.

27 CFR Part 20-Distribution and Denatured Alcohol and Rum. 27 CFR Part 21-Formulas for De Alcohol and Rum.

27 CFR Part 22-Distribution and Tax-Free Alcohol.

27 CFR Part 30-Gauging Manual. 27 CFR Part 170-Miscellaneous tions Relating to Liquor.

27 CFR Part 194-Liquor Dealers. 27 CFR Part 197-Drawback on D Spirits Used in Manfacturing No age Products.

27 CFR Part 200-Rules of Prac Permit Proceedings.

27 CFR Part 231-Taxpaid Wine B Houses.

27 CFR Part 240-Wine.

27 CFR Part 250-Liquors and Article Puerto Rico and the Virgin Island 27 CFR Part 251-Importation of D Spirits, Wine, and Beer.

27 CFR Part 252-Exportation of Liqu 31 CFR Part 225-Acceptance of 1 Notes, or Other Obligations Issu Guaranteed by the United States curity in Lieu of Surety or Suret Penal Bonds.

[T.D. ATF-199, 50 FR 9160, Mar. 6, 19 amended by T.D. ATF-207, 50 FR: June 5, 1985]

Subpart B-Definitions

§ 19.11 Meaning of terms.

When used in this part and in fo prescribed under this part, terms s have the meaning ascribed in this tion. Words in the plural form inc the singular, and vice versa, and w indicating the masculine gender clude the feminine. The terms cludes" and "including" do not clude other things not enumera which are in the same general class

Alcoholic flavoring materials. term "alcoholic flavoring materia means those nonbeverage products which drawback has been or will claimed under 26 U.S.C. 5131-5134 flavors imported free of tax which a unfit for beverage purposes. The te does not include flavorings or flav ing extracts manufactured on t bonded premises of a distilled spir plant as an intermediate product.

Application for registration. The a plication required under 26 U.S. 5171(c).

Area supervisor. The supervisory officer of the Bureau of Alcohol, Tobacco and Firearms area office.

Article. A product, containing denatured spirits, which was manufactured under 27 CFR Part 20 or this part.

ATF bond. For purposes of this part, ATF bond means the internal revenue bond as prescribed in 26 U.S.C. Chapter 51.

ATF officer. An officer or employee of the Bureau of Alcohol, Tobacco and Firearms (ATF) authorized to perform any function relating to the administration or enforcement of this part. Bank. Any commercial bank.

Banking day. Any day during which a bank is open to the public for carrying on substantially all its banking functions.

Basic permit. The document authorizing the person named therein to engage in a designated business or activity under the Federal Alcohol Administration Act.

Bonded premises. The premises of a distilled spirits plant, or part thereof, as described in the application for registration, on which distilled spirits operations defined in 26 U.S.C. 5002 are authorized to be conducted.

Bottler. A proprietor of a distilled spirits plant qualified under this part as a processor who bottles distilled spirits.

Bulk container. Any approved container having a capacity in excess of one wine gallon.

Bulk conveyance. A tank car, tank truck, tank ship, tank barge, or a compartment of any such conveyance, or any other container approved by the Director for the conveyance of comparable quantities of spirits, including denatured spirits, and wines.

Bulk distilled spirits. The term "bulk distilled spirits" means distilled spirits in a container having a capacity in excess of one gallon.

Business day. Any day, other than a Saturday, Sunday, or a legal holiday. (The term legal holiday includes all holidays in the District of Columbia and statewide holidays in the particular State in which the claim, report, or return, as the case may be, is required to be filed, or the act is required to be performed.)

Carrier. Any person, company, corporation, or organization, including a proprietor, owner, consignor, consignee, or bailee, who transports distilled spirits, denatured spirits, or wine in any manner for himself or others.

CFR. The Code of Federal Regulations.

Commercial bank. A bank, whether or not a member of the Federal Reserve system, which has access to the Federal Reserve Communications System (FRCS) or Fedwire. The "FRCS" or "Fedwire" is a communications network that allows Federal Reserve system member banks to effect a transfer of funds for their customers (or other commercial banks) to the Treasury Account at the Federal Reserve Bank of New York.

Container. A receptacle, vessel, or form of bottle, can, package, tank or pipeline (where specifically included) used or capable of being used to contain, store, transfer, convey, remove, or withdraw spirits and denatured spirits.

Denaturant or denaturing material. Any material authorized under 27 CFR Part 21 for addition to spirits in the production of denatured spirits.

Fedwire to the Treasury Account at the Federal Reserve Bank of New York.

Export or exportation. A severance of goods from the mass of things belonging to the United States with the intention of uniting them to the mass of things belonging to some foreign country and shall include shipments to any possession of the United States. For the purposes of this part, shipments of Puerto Rico, and to the territories of the Virgin Islands, American Samoa, and Guam, shall also be treated as exportations.

to the Commonwealth

Fermenting material. Any material which is to be subjected to a process of fermentation to produce distilling material.

Fiduciary. A guardian, trustee, executor, administrator, receiver, conservator, or any person acting in any fiduciary capacity for any person.

Fiscal year. The period October 1 of one calendar year through September 30 of the following year.

Gallon or wine gallon. The liquid measure equivalent to the volume of 231 cubic inches.

In bond. When used with respect to spirits, denatured spirits, articles, or wine refers to spirits, denatured spirits, articles, or wine possessed under bond to secure the payment of the taxes imposed by 26 U.S.C. Chapter 51, and on which such taxes have not been determined. The term includes such spirits, denatured spirits, articles, or wine on the bonded premises of a distilled spirits plant, such spirits, denatured spirits, or wines in transit between bonded premises (including, in the case of wine, bonded wine cellar premises). Additionally, the term refers to spirits in transit from customs custody to bonded premises, and spirits withdrawn without payment of tax under 26 U.S.C. 5214, and with respect to which relief from liability has not occurred under the provisions of 26 U.S.C. 5005(e)(2).

Industrial use. As applied to spirits, shall have the meaning ascribed in 27 CFR Part 2.

Intermediate product. Any product manufactured pursuant to an approved formula under 27 CFR Part 5, not intended for sale as such but for

use in the manufacture of a distilled spirits product.

I.R.C. The Internal Revenue Code of 1954, as amended.

Kind. As applied to spirits, except as provided in § 19.597, kind shall mean class and type as prescribed in 27 CFR Part 5. As applied to wines, kind shall mean the classes and types of wines as prescribed in 27 CFR Part 4.

Liquor bottle. A bottle made of glass or earthenware, or of other suitable material approved by the Food and Drug Administration, which has been designed or is intended for use as a container for distilled spirits for sale for beverage purposes and which has been determined by the Director to protect the revenue adequately.

Liter. A metric unit of capacity equal to 1,000 cubic centimeters of alcoholic beverage, and equivalent to 33.814 fluid ounces. A liter is divided into 1,000 milliliters. Milliliter or milliliters may be abbreviated as "ml."

Lot identification. The lot identification described in § 19.593.

Mash, wort, wash. Any fermented material capable of, or intended for, use as a distilling material.

Nonindustrial use. As applied to spirits, shall have the meaning ascribed in 27 CFR Part 2.

Operating permit. The document issued pursuant to 26 U.S.C. 5171(d), authorizing the person named therein to engage in the business or operation described therein.

Package. A cask or barrel or similar wooden container, or a drum or similar metal container.

Package identification number. The package identification number described in § 19.593.

Person. An individual, trust, estate, partnership, association, company, or corporation.

Plant or distilled spirits plant. An establishment qualified under this part for distilling, warehousing, processing or any combination thereof.

Plant number. The number assigned to a distilled spirits plant by the regional director (compliance).

Processor. Except as otherwise provided under 26 U.S.C. 5002(a)(6), any person qualified under this part who manufactures, mixes, bottles, or otherwise processes distilled spirits or dena

tured spirits, or manufactures any article.

Proof. The ethyl alcohol content of a liquid at 60 degrees Fahrenheit, stated as twice the percent of ethyl alcohol by volume.

Proof of distillation. The composite proof of the spirits at the time the production gauge is made,or, if the spirits had been reduced in proof prior to the production gauge, the proof of the spirits prior to such reduction, unless the spirits are subsequently redistilled at a higher proof than the proof prior to reduction.

Proof gallon. A gallon of liquid at 60 degrees Fahrenheit which contains 50 percent by volume of ethyl alcohol having a specific gravity of 0.7939 at 60 degrees Fahrenheit referred to water at 60 degrees Fahrenheit as unity, or the alcoholic equivalent thereof.

Proprietor. The person qualified under this part to operate the distilled spirits plant.

Reconditioning. The dumping of distilled spirits products in bond after their bottling or packaging, for purposes other than destruction, denaturation, redistillation, or rebottling. The term may include the filtration, clarification, stabilization, or reformulation of a product.

Recovered article. An article containing specially denatured spirits salvaged without all of its original ingredients, or an article containing completely denatured alcohol salvaged without all of the denaturants for completely denatured alcohol, under CFR Part 20.

Region. A Bureau of Alcohol, TobacCo and Firearms region.

Region director (compliance). The principal regional official responsible for administering regulations in this

part.

Season. The period from January 1 through June 30, is the spring season, and the period from July 1 through December 31 is the fall season.

Secretary. The Secretary of the Treasury or his delegate.

Service center. An Internal Revenue Service Center in any of the Internal Revenue regions.

Spirits or distilled spirits. That substance known as ethyl alcohol, etha

nol, or spirits of wine in any form (including all dilutions and mixtures thereof, from whatever source or by whatever process produced) but not denatured spirits unless specifically stated. The term does not include mixtures of distilled spirits and wine, bottled at 48° proof or less, if the mixture contains more than 50 percent wine on a proof gallon basis.

Spirits residues. Residues, containing distilled spirits, of a manufacturing process related to the production of an article under 27 CFR Part 20.

Tax-determined or determined. When used with respect to the tax on any distilled spirits to be withdrawn from bond on determination of tax, shall mean that the taxable quantity of spirits has been established.

Taxpaid. When used with respect to distilled spirits shall mean that all applicable taxes imposed by law in respect of such spirits have been determined or paid as provided by law.

This chapter. Title 27, Code of Federal Regulations, Chapter I (27 CFR Chapter I).

Transfer in bond. The removal of spirits, denatured spirits and wines from one bonded premises to another bonded premises.

Treasury Account. The Department of the Treasury's General Account at the Federal Reserve Bank of New York.

Unfinished spirits. Spirits in the production system prior to production gauge.

U.S.C. The United States Code.

Warehouseman. A proprietor of a distilled spirits plant qualified under this part to store bulk distilled spirits.

Wine spirits. The term "wine spirits" means spirits authorized for use in wine production by 26 U.S.C. 5373.

[T.D. ATF-198, 50 FR 8464, Mar. 1, 1985, as amended by T.D. ATF-199, 50 FR 9160, Mar. 6, 1985; T.D. ATF-206, 50 FR 23951, June 7, 1985; T.D. ATF-230, 51 FR 21748, June 16, 1986]

A tax is imposed by 26 U.S.C. 5001 on all spirits produced in or imported into the United States at the rate prescribed in such section on each proof gallon and a proportionate tax at a like rate on all fractional parts of a proof gallon. Wines containing more than 24 percent of alcohol by volume are taxed as spirits. All products of distillation, by whatever name known, which contain spirits, on which the tax imposed by law has not been paid, and any alcoholic ingredient added to such products, are considered and taxed as spirits.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1314, as amended) (26 U.S.C. 5001))

§ 19.22 Attachment of tax.

Under 26 U.S.C. 5001(b), the tax attaches to spirits as soon as the substance comes into existence as such, whether it be subsequently separated as pure or impure spirits, or be immediately, or at any subsequent time, transferred into any other substance, either in the process of original production, or by any subsequent process. (Sec. 201, Pub. L. 85-859, 72 Stat. 1314, as amended (26 U.S.C. 5001))

§ 19.23 Lien.

Under 26 U.S.C. 5004, the tax becomes a first lien on the spirits from the time the spirits come into existence as such. The conditions under which the first lien shall be terminated are described in 26 U.S.C. 5004.

(Sec. 201, Pub. L. 85-859, 72 Stat. 1317, as amended (26 U.S.C. 5004))

[T.D. ATF-198, 50 FR 8464, Mar. 1, 1985; 50 FR 23410, June 4, 1985]

§ 19.24 Persons liable for tax.

(a) Distilling. 26 U.S.C. 5005 provides that the distiller of spirits is liable for the tax and that each proprietor or possessor of, and person in any manner interested in the use of, any still, distilling apparatus, or distillery, shall be jointly and severally liable for the tax on distilled spirits produced. However, a person, not an officer or

director of a corporate pr owning or having the right of of not more than 10 percent class of stock of that proprieto liable by reason of the stock ship or control. Persons tran spirits in bond so liable for the relieved of liability if

(1) The proprietors of tran and receiving premises are in ent of each other and neithe proprietary interest, directly rectly, in the business of the and

(2) No person so liable for the the spirits transferred retains terest in the spirits.

(b) Storage on bonded prem U.S.C. 5005(c) provides that person operating bonded pr shall be liable for the tax on all while the spirits are stored o premises, and on all spirits whi in transit to the premises fro time of removal from the trans bonded premises, pursuant to a proved application. Liability fo tax continues until the spirit transferred or withdrawn from b premises as authorized by law, o the liability for tax is relieved the provisions of 26 U.S.C. 50 Claims for relief from liability fo its lost are provided for in § 19.41 untary destruction of spirits in b provided for in Subpart U of this

(c) Withdrawals without payme tax. Under 26 U.S.C. 5005(e), person who withdraws spirits from bonded premises of a plant wit payment of tax, as provided i U.S.C. 5214, shall be liable for th on the spirits from the time of drawal. The person shall be reliev any liability at the time the spirit exported, deposited in a foreign-t zone, used in production of wine posited in a customs bonded w house, laden as supplies upon or in the maintenance or repair of tain vessels or aircraft, or used for tain research, development or test as provided by law.

(d) Withdrawals free of tax. Pers liable for tax under paragraph (a) this section, are relieved of the lia ity on spirits withdrawn from bon premises free of tax under this part the time the spirits are withdrawn.