How does one account for evaporation losses in book keeping and tax payment?
I guess what I'm getting at is say I produce 50 gallons of 125 proof spirits. I take that 50 gallons and barrel them for 5 years. For the sake of this discussion I lose 5 proof per year, so at the end of five years I have 50 gallons of 100 proof.
How would I account for the 20% loss? I didn't destroy it and I didn't take it out of inventory. Also say I record 125 proof going in and a year latter the TTB stops by to check and it now at 120 proof, how would that be dealt with?
Would I need to make periodic adjustments in the records? If so what would be the appropriate interval?
Do I pay taxes on the 125 poof that went into the barrel or the 100 proof that comes out?
If this subject has been addressed elsewhere please point it out.
Thanks, Friday
I have a similar question but with the reverse outcome.
What if I observe maturation increases my Proof? so I have 50 gallons at 110 proof at the date of filling (55 pg)
after maturation I have 48 gallons at 125 proof (60 PG)
How is that recorded for ttb?
If I dilute to 90 proof, I have actually increased my bottle output from the date the cask was filled
evaporation loss and taxes?
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I have a similar question but with the reverse outcome.
What if I observe maturation increases my Proof? so I have 50 gallons at 110 proof at the date of filling (55 pg)
after maturation I have 48 gallons at 125 proof (60 PG)
How is that recorded for ttb?
If I dilute to 90 proof, I have actually increased my bottle output from the date the cask was filled