As we wrote about earlier this month, the Tax Cuts and Jobs Act (H.R. 1) passed late last year included significant, temporary federal excise tax relief for wine, beer and spirits businesses for 2018 and 2019.  Unfortunately, in an apparent oversight of legislative drafting, the wine excise tax relief (provided in the form of a tax credit) was drafted in such a way that custom-crush facilities and bonded wine cellars were not eligible to receive the credit.

The Alcohol Tax and Trade Bureau earlier this year implemented an alternate procedure to allow affected wineries to make on-paper transfers of wine that effectively corrected the oversight and allowed such wineries to claim the credit.  The alternate procedure was set to expire on June 30th, but the Alcohol Tax and Trade Bureau recently extended that expiration date to the end of 2019, to cover the remainder of the temporary excise tax reduction period.  Wine Spectator has been following this issue closely — see here and here.  As efforts continue to make the two-year tax reductions permanent, wineries should watch to see how Congress addresses the availability of the credit.

If you have questions about tax law changes impacting the beverage industry, please contact one of the attorneys listed below:

Dustin Swanson at 503.294.9262 or dustin.swanson@stoel.com

Todd Friedman at 503.294.9327 or todd.friedman@stoel.com

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Dustin Swanson Dustin Swanson

Dustin Swanson advises on federal, state, and local tax issues that affect businesses and individuals. His transactional practice encompasses a wide variety of issues, including entity formation, taxable and tax-free mergers and acquisitions, transactions involving pass-through entities such as LLCs, partnerships, and S…

Dustin Swanson advises on federal, state, and local tax issues that affect businesses and individuals. His transactional practice encompasses a wide variety of issues, including entity formation, taxable and tax-free mergers and acquisitions, transactions involving pass-through entities such as LLCs, partnerships, and S corporations, and the development, financing, acquisition, and sale of tax credit projects. As part of his practice, Dustin regularly works with clients to identify and maximize federal, state, and local tax incentives.

Photo of Todd Friedman Todd Friedman

Todd Friedman practices business law, focusing on advising entrepreneurial, emerging, growing and established companies with respect to business formation and structuring, commercial contracting, debt and equity financing, mergers and acquisitions, and real property matters. He has represented clients in industries including: food and…

Todd Friedman practices business law, focusing on advising entrepreneurial, emerging, growing and established companies with respect to business formation and structuring, commercial contracting, debt and equity financing, mergers and acquisitions, and real property matters. He has represented clients in industries including: food and agribusiness; wine, beer and spirits; restaurant and hospitality; technology; branded consumer products; and creative services. Todd is co-chair of the firm’s Beverage and Hospitality initiative.

Click here for Todd Friedman’s full bio.