Artisan Spirit: Spring 2015

Page 77

This is the first in a series of articles providing a focused look at the Federal regulatory requirements for filing reports of operations and excise tax returns and payments.

S

o, you have just received your Distilled Spirits Plant (DSP) approval. Congratulations and best wishes for

success! You now have a hundred or more things to do

DSP Federal Reporting

as you get started. One item for the list is how to prepare government reports and pay excise taxes for DSP products. In this and succeeding articles, the basics for what and when to file, and answers to the mysteries about what numbers go where, will be reviewed.

MONTHLY REPORT of PRODUCTION OPERATIONS TTB FORM 5110.40 WRITTEN BY JIM MCCOY

There are a few basic concepts to begin with. The Federal Regulations in 27 CFR Part 19 require that you, as the principal operating a DSP, file monthly reports of your Production, Storage and Processing operations, and at least quarterly Excise Tax Return forms and payments. Why three monthly reports? The current required report forms reflect the setup of the DSP records and operations in three areas: Production, Storage and Processing, as required by the regulations. These three areas are where the products are created, warehoused, and finished. Each movement of product between these three areas must be measured and recorded, and those recorded transactions add up to the summary figures on the reports, and removals of finished goods from the DSP are reported in Processing and paid for using the Excise Tax Return. Knowing which information to capture and summarize is the first problem to solve in preparing accurate reports.

MONTHLY REPORT OF PRODUCTION OPERATIONS, TTB F 5110.40 The first report we will look at is the Monthly Report of Production Operations, TTB F 5110.40. This report reflects the quantities of spirits produced, and where they were sent from the production account. This account reports materials used, kind and quantity made, and some other details about certain types of spirits. This report has two pages, beginning with Part I - Transactions, and ending on page 2 with Part VI - Materials Used. In Part I, it is unlikely that the average artisan distiller will ever use “WITHDRAWN

FOR”

Lines 1 through 8, so those

are skipped. Why? The Production account is strictly bulk materials made and likely still in a tank. In short, these are very specific things more likely to be done from the storage or processing area. Lines 9, 10 and 11 are used to report movement of spirits from production to Processing, another DSP (Transfer in Bond), or to Storage, respectively. Line 12 reports samples taken and shipped for analysis; samples kept in bond go in the sampling record, but are not withdrawn from the plant so they are not reported here. Line 14 is the total of the lines above it, for each column of the report.

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