This week, the TTB issued a ruling clarifying the bottling of taxpaid wine in growlers. This has become a common practice by some retailers (such as Whole Foods) in certain states. The TTB has not been clear leading up to this ruling on exactly what the rules are for selling wine in growlers. According to the ruling:
The filling of wine growlers or similar containers with taxpaid wine for consumption off of the premises is considered bottling or packing under the Internal Revenue Code of 1986, as amended (IRC), and any person who engages in this activity must first qualify as a taxpaid wine bottling house and also must comply with all requirements applicable to taxpaid wine bottling houses, including labeling and recordkeeping requirements under the IRC and the regulations in 27 CFR part 24.
It is the official position of the TTB, that the filling of growlers with taxpaid wine for the purpose of consumption off premises is an activity that can only be conducted lawfully by a “qualified taxpaid bottling house”. The Internal Revenue Code of 1986, as amended, regulates the bottling, rebottling, packing and repacking of taxpaid wine by any person. Retailers and proprietors of wine premises are required by law to qualify as a taxpaid wine bottling house prior to conducting such operations.
The TTB requires that all retailers that are selling growlers for off premises consumption apply to be a taxpaid bottling house. The text below is the official TTB ruling:
Held, the filling of growlers or similar containers with taxpaid wine for the purpose of consumption off of the premises is considered bottling or packing under the IRC and is an activity that may be conducted lawfully only by a qualified taxpaid wine bottling house. Such activity is subject to all of the provisions applicable to taxpaid wine bottling houses under the IRC and 27 CFR part 24, including the labeling and recordkeeping requirements in those regulations. These requirements apply regardless of whether the containers are provided by the consumer or the retailer/proprietor and regardless of whether the containers are filled before or after the sale occurs.
Held further, the labeling requirements of the FAA Act and ABLA do not apply to growlers or similar containers, provided that the taxpaid wine is sold to the consumer prior to being placed in the growler in the presence of the consumer. Consumers may furnish their own growler or may purchase it from the proprietor. However, any such containers that are filled in advance of the sale of the wine are subject to all applicable requirements of the FAA Act and ABLA, in addition to the requirements of the IRC.
To read the entire ruling please go here: http://www.ttb.gov/rulings/2014-3.pdf
Please feel free to contact WineAmerica with any questions. 202-223-5172 or mkaiser@nullwineamerica.org
