PATH Act Bond Requirements for Alcohol Industries

Changes to excise tax due dates and bond requirements in the Internal Revenue Code of 1986 made by the Protecting Americans from Tax Hikes Act of 2015 (PATH Act) become effective on January 1, 2017. Briefly, the changes are as follows:

• Beginning with the calendar quarter that starts on January 1, 2017, taxpayers who reasonably expect to be liable for not more than $1,000 in taxes imposed with respect to distilled spirits, wines, and beer for the calendar year (and who were liable for not more than $1,000 in such taxes in the preceding calendar year) can pay those taxes annually, rather than quarterly.
• Beginning with the calendar quarter that starts on January 1, 2017, taxpayers are exempt from bond requirements if they reasonably expect to be liable for not more than $50,000 in taxes imposed on distilled spirits, wine, and beer for the calendar year, were liable for not more than $50,000 in such taxes in the preceding calendar year, and pay taxes on a semi-monthly, quarterly, or annual basis. Such taxpayers are exempt from bond requirements with respect to distilled spirits and wine only to the extent those products are for nonindustrial use.