Amendment to drop DSP Bond Time Line

[Falling Rock]

To those that have filed an amendment to drop DSP Bond, how long did it take?

My Amendment was submitted 45 days ago and is still "REVIEW IN PROCESS" and "Amendment Pending."

[bluefish_dist]

I was quicker than that.  Maybe a month.  But that was when the law first went into effect.  

[dhdunbar]

Missed this.  That is too long.  If you haven't found anything out on this., call the help desk and see if they can get things moving.

[InsuranceMan]

Agreed, that is a long time.  My experience has shown me that it really should be resolved within 30 days.  Most of my clients that have put in for the exemption online through PONL have had it turned around in anywhere from 2 weeks to a month.  I would give them a call.

 

Best,

Aaron

[Falling Rock]

Well, the amendment just got denied. 90 days

Basically they want the Operations reports filed from the date of  DSP Approval until the date we sent Letter of Commencing Operations.

There is a few posts about others being told that the Letter of Commence means nothing. The Letter of Commencing Operations means...?

So, I'll submit those months with all Zeros and file again. Interesting

 

 

[captnKB]

The Letter of Commencing you are being asked for is in reference to TTB form F 5110.34 This is a form that all distilleries are supposed to file with the TTB when they start producing. see link below to the form.

https://www.ttb.gov/forms/f511034.pdf

[Falling Rock]

They are not asking for a Notice Of Commencement, which we did file. They are asking for all the reports prior to the date of commencement. hmmm...

[dhdunbar]

Let's sort through this.

The letter of commencement is just that, a letterhead notice.  Here is the section of regulation that applies to persons who produce, .i.e, persons who distill, and only to persons who distill:

• Sec. 19.292  Notice of operations.   A proprietor authorized to produce distilled spirits may not commence, suspend, or resume production operations at the plant without first providing written notice to TTB.
• Beginning operations. A proprietor must file a letterhead notice with the appropriate TTB officer before beginning or resuming production operations. A proprietor must not begin or resume operations before the time specified in the notice.

Letterhead notice is a defined term. 19.1 - it  is a letter on a company's letterhead or other piece of paper that clearly shows the company name from a company representative with signature authority. A letterhead notice does not require approval by TTB prior to the change.

I would venture few do this.  You can modify "few" with "very" and come closer to being correct.  And then modify "very" with "very." 

TTB form 5110.34 is not longer available on TTB's website and as far as I know, permits on line has abandoned all notices.  In the late 1990's,  TTB allowed letterhead notices in lieu of the form, which is the source of the current section 19.292's notice provisions, which was introduced in the revision of 2011. 

Next. since it migrated to Permits Online, letterhead notices have all but died.  If you search part 19, you will find more than a few references to them, for example, in the sections on changes to construction, to name one.  But the NRC now treats them all as amendment to the registration.  So there is the background on that.

Now, the the issue here is the reports AND the tax returns for which TTB is asking. Here is the logic of the request.  

TTB's rule is simple. 

• Sec. 19.632  requires monthly reports for all operations in which you are authorized to engage, with the only exception being the production reports (but not storage or processing reports if you are authorized to conduct those operations,) during periods when you have told TTB, by letterhead notice, under the provisions of 19.292, that you are suspending production operations.  Very, very few do that, so reports are required for all months, without regard to whether you had transactions. 
• Similarly, 19.234  requires that a proprietor  must execute and file the tax return (TTB F 5000.24) for each return period, even when no tax is due for a particular return period.

Note that submitting the reports and returns requires you to state, under penalties of perjury, that they are true and correct, etc.  Deliberately false statements thereby become punishable as felonies (to be very carefully clear, the failure to submit them is not a felony unless it is done for the purpose of evasion of taxes that are owed, but lying on the form is felonious).

Next, the bonding company is on the hook for unpaid taxes.  Without operating reports, even those with all of those zeros, TTB has no idea what tax liability you might have incurred for which the bonding company is liable if you have not paid it.  Without the tax returns, TTB does not know if you paid the taxes, if any, for which you are liable.  So, before TTB allows you to terminate the bond, TTB wants you to file the reports and returns for the entire period since you were authorized to conduct operations.  It then feels comfortable with the termination.

That is a long winded explanation, but I always try to show how something fits into the scheme.  That way, eventually, the logic of seemingly illogical requests may sometimes be made clear.  

[dhdunbar]

Well, I no sooner say "very, very few file notices of commencement and Falling Rock declares that he is a rare bird.  

Okay -    

Falling Rock - whatever they may say, they are looking for reports and returns for the whole of the period.  Eventually, I predict, they will collect that pound of flesh, so if you want to avoid delay go back to the first month they approved your registration and start filling out forms.  As you say, zero's.  Don't put them in every cell or you'll end up in one with pads.  The total of totals suffices to state, we did nothing!

[Falling Rock]

So, I assume, now, they want the reports from date of DSP approval and the our intended date of commencement means nothing.

Thanks DHD we will go back and send the Zero reports asap.

[Langdon Guenther]

On ‎11‎/‎20‎/‎2018 at 7:31 PM, Falling Rock said:

So, I assume, now, they want the reports from date of DSP approval and the our intended date of commencement means nothing.

Thanks DHD we will go back and send the Zero reports asap.

To be succinct, TTB requires monthly reports to be filed beginning with the month that your Basic Permit is issued. For example, if your Basic Permit is effective March 31st, you must file monthly reports for March and for all succeeding months that your permit is active. You must also begin filing excise tax returns by the required due date. If you are an annual filer, your excise tax return would be due by January 14, 2020 for the period January 1 through December 31, 2019.

To respond to your original question: I am retired from TTB's National Revenue Center (NRC) and I know that to a sometimes large degree that your amendment's processing time (including terminating a bond) depends on which NRC specialist is working it. Contact me with any questions. Langdon Guenther