Removals from Bond
A removal from bond is the act of taking spirits out of the bonded premises, most commonly on determination of tax for sale. Removals are what trigger the federal excise tax.
Spirits sit in bond untaxed until they are removed, so removals are the event the excise return is built around. Each taxable removal, recorded in proof gallons, drives the tax owed at the applicable CBMA rate. Tracking removals accurately is what keeps the excise return and the storage account in agreement.
When does tax become due on a removal?
Tax is determined when spirits are removed from bond for sale or consumption, and is reported on the excise return (TTB F 5000.24) for the period of removal. Some transfers in bond between plants are not taxable removals.
How do removals affect the storage report?
Every removal decrements the bonded storage account (5110.11) and, if it moves spirit to bottling, feeds the processing account (5110.28). Because one recorded event drives all of them, the reports reconcile.
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