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TTB Alcohol Tax Refund

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Brothbro

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Posted 04 March 2022 - 07:17 PM

Hello All,

 

Apologies in advanced if Alcohol and Tobacco Tax and Trade Bureau (TTB) discussion is not supposed to be in this forum. Some of my company's products are alcohol based herbal extracts, for which we use organic cane ethanol during the batching process. When we buy this alcohol we pay a huge tax fee, but I've heard that depending on the end-use of this alcohol the taxes may be refunded. Looking through the TTB website the regulations are unclear...as well as the process we'd have to follow for a product like ours. Wonder if anyone here has experience in TTB alcohol tax refunds for dietary supplements or food products? The alcohol content of our finished product ranges from 25% - 50%. They are sold in 1oz or 2oz bottles, consumer are intended to consume only a small amount per day (~15 ml)

 

Thank you



Spidey

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Posted 04 March 2022 - 09:25 PM

There is a way to get that tax money refunded!  We are a flavor company and I don't know how this translates to dietary supplements.

 

You have to submit your formulas to the TTB and they have to be approved as non-beverage, i.e. they taste so bad that people won't drink them to get drunk.  There are certain criteria the formulas must meet to qualify as non-beverage, the information regarding this should be available on the TTB website.  The formula submission is also through the TTB website.  In addition to the formula submission, you have to regularly (my company does this quarterly) report your alcohol usage to the TTB; tell them what you made, how much alcohol was used, how much alcohol you received, and how much is still in inventory, etc.  After they review this report, if they find that you used the alcohol in the approved fashion, they will refund you most of the alcohol tax.

 

Just an FYI, this process sucks and they are always looking for ways to not approve your formulas and not refund your money.  Also, the rules are constantly changing and they don't tell you about those changes until they reject your formulas or fine your quarterly reports.  I believe there is a class you can attend where they teach you the basics of this, at least there was 17 years ago when my Dad took it.


Edited by Spidey, 04 March 2022 - 09:26 PM.


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Brothbro

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Posted 04 March 2022 - 09:42 PM

Thanks Spidey...I was at least able to gather how much of a headache this can be is the research I've done. I think the product we make could be considered similar to a alcohol-based flavor extract. It sounds like this may be worth pursuing for our company, although it could be up to a year before we see any money out of it!



Spidey

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Posted 04 March 2022 - 09:46 PM

I think the longest we've waited for refund money is about 18 months.





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