All terms
Distillery glossary
Federal Excise Tax (Spirits)
The federal excise tax on distilled spirits is a per-proof-gallon tax owed when spirits are removed from bond, reported to the TTB on the semi-monthly excise return (Form 5000.24).
Under the Craft Beverage Modernization Act (CBMA), reduced rates apply to the first tiers of production each calendar year, so a producer's effective rate rises as annual volume grows. Calculating the tax correctly means applying those tiers cumulatively across the year, on the proof gallons actually removed.
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