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New tax reform

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On 12/21/2017 at 5:56 PM, bluefish_dist said:

I am a little surprised how high they set the limit for the lower tax.  100,000 proof gallons is not really craft IMHO.  Probably could have been half or 1/3 that volume.    Just over $1,000,000 per year tax savings for the big guys.  

The 100,000 pg figure was based loosely on the corresponding volume difference between rates for small and large brewers, and the rate of $2.70 was based loosely on the difference in rates paid for the small and large brewers.

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The Thing that makes me the most mad is..... by the time the TTB and everyone figures all of this out, it will be 6-8 months down the road, and 25%-35% of our 2 years will be gone.

I say ...

1. get a lawyer.

2. It is easier to ask for forgiveness than to ask for permission.

I am not saying break the law, I am saying to do what you think is right and document the heck out of everything.

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I have not read through this entire string of replies, so forgive me if it was already asked or stated... Since the tax reform was already signed in, and we don't file our excise taxes until January 15th, can we apply the new rates since we are actually paying in January?? Seems to me me, paying the bill after a new rate is set would be at the new rate. Any accountants or tax lawyers on here? Cheers!

 

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Are you certain?? I am working on December numbers and if we can use new excise tax numbers, I intend to. I am going to call TTB

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1 hour ago, Denise said:

Are you certain?? I am working on December numbers and if we can use new excise tax numbers, I intend to. I am going to call TTB

Pretty sure you pay at the rate that you removed it at,  If you removed it from bond last year thats 13.50.  But let us know if you hear anything from TTB 

 

 

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I believe the last retroactive tax was done by Clinton, and it wasn't good. 

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4 hours ago, Denise said:

I have not read through this entire string of replies, so forgive me if it was already asked or stated... Since the tax reform was already signed in, and we don't file our excise taxes until January 15th, can we apply the new rates since we are actually paying in January?? Seems to me me, paying the bill after a new rate is set would be at the new rate. Any accountants or tax lawyers on here? Cheers!

 

What?

Your paying by the 15th for the last quarter.

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8 minutes ago, Dehner Distillery said:

What?

Your paying by the 15th for the last quarter.

yep thats how it goes... by the 15th of the following month unless you pay quarterly. I pay monthly.

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My reading of the amendment, which is the only way to answer these questions until TTB rules,  is that you must pay for December removals at the rate in effect at the time of the removal, not the time of deferred payment.   I see no doubt in this case.  To be eligible for the reduced rate, the spirits must be removed during the calendar years to which the rate applies.  The language of the amended section is clear:

 

SEC. 13807. REDUCED RATE OF EXCISE TAX ON CERTAIN DISTILLED SPIRITS.

(a) In General.—Section 5001 is amended by redesignating subsection (c) as subsection (d) and by inserting after subsection (b) the following new subsection:

“(c) Reduced Rate For 2018 And 2019.—

“(1) IN GENERAL.—In the case of a distilled spirits operation, the otherwise applicable tax rate under subsection (a)(1) shall be—

“(A) $2.70 per proof gallon on the first 100,000 proof gallons of distilled spirits, and

“(B) $13.34 per proof gallon on the first 22,130,000 of proof gallons of distilled spirits to which subparagraph (A) does not apply,

which have been distilled or processed by such operation and removed during the calendar year for consumption or sale, or which have been imported by the importer into the United States during the calendar year.

The emphasis is mine. 

Note that it appears that if a DSP receives bottled spirits that it neither bottled nor processed, the tax rate is $13.34.  I had not caught that before.  Such omissions, by amateur like me, are the reason we have to wait for TTB to issue the rules.  They should have a number of persons reading the amendments and arriving at the official interpretation of what they mean. 

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16 minutes ago, dhdunbar said:

My reading of the amendment, which is the only way to answer these questions until TTB rules,  is that you must pay for December removals at the rate in effect at the time of the removal, not the time of deferred payment.   I see no doubt in this case.  To be eligible for the reduced rate, the spirits must be removed during the calendar years to which the rate applies.  The language of the amended section is clear:

 

SEC. 13807. REDUCED RATE OF EXCISE TAX ON CERTAIN DISTILLED SPIRITS.

(a) In General.—Section 5001 is amended by redesignating subsection (c) as subsection (d) and by inserting after subsection (b) the following new subsection:

“(c) Reduced Rate For 2018 And 2019.—

“(1) IN GENERAL.—In the case of a distilled spirits operation, the otherwise applicable tax rate under subsection (a)(1) shall be—

“(A) $2.70 per proof gallon on the first 100,000 proof gallons of distilled spirits, and

“(B) $13.34 per proof gallon on the first 22,130,000 of proof gallons of distilled spirits to which subparagraph (A) does not apply,

which have been distilled or processed by such operation and removed during the calendar year for consumption or sale, or which have been imported by the importer into the United States during the calendar year.

The emphasis is mine. 

Note that it appears that if a DSP receives bottled spirits that it neither bottled nor processed, the tax rate is $13.34.  I had not caught that before.  Such omissions, by amateur like me, are the reason we have to wait for TTB to issue the rules.  They should have a number of persons reading the amendments and arriving at the official interpretation of what they mean. 

Thanks for this legislative excerpt! I guess We are paying the full amount for 2017. I am ok with that, as long as we have actually received the reduction for 2018. It's been a tough fight forward, but we made it! Looking forward, and not back! This is a great thing for the industry! 

 

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22 hours ago, Denise said:

yep thats how it goes... by the 15th of the following month unless you pay quarterly. I pay monthly.

I know. Thank you.

Im just saying there should be a test before you get a DSP. Some people just blow my mind. I am still glad to help when I can.

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