Are you considering opening a distillery? If so, you will be operating a business in a highly regulated industry. Here is an overview of some critical issues to start the process.
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The Alcohol and Tobacco Tax and Trade Bureau (TTB) oversees federal compliance for the production and distribution of alcoholic beverages. What does this mean for you?
The process starts with determining what you want to produce. The application to TTB for your licensed operations will include submission of information relating to:
The review process also includes a variety of other issues relating to how the public will interact with your distillery. In addition to applying to the Federal government, it will be necessary to acquire a license from your state’s Alcohol Beverage Control authority. Additionally, it will be necessary to get licensed in each state in which you want to sell your spirits. It is important to note that changes in the organizational structure of your business during the review of your application could potentially delay the issuance of your license.
All spirits require label approval. If your label is approved, TTB will issue a Certificate of Label Approval, known as a COLA. Some products require formula approval prior to issuance of a COLA. You should make a determination about whether or not a formula is necessary as your label process could be delayed without making this determination. TTB’s primary interest in reviewing labels is to determine whether a proposed label identifies the product in an accurate and non-misleading way.
The production of alcohol results in the assessment of an excise tax. An excise tax is a tax on the manufacture, sale, or use of goods or the transfer of property—in this case, alcohol. Federal excise taxes are paid to the National Revenue Center, a division of TTB. Various state taxing authorities collect state excise taxes.
Many new distillers prefer professional assistance with the organizational and licensure process. If you would like assistance with any of these issues, please call us at (314) 768-0220 or email [email protected].