Preparation of Forms 2636 and 2731
Proprietors of distilled spirits plants,
and others concerned:
Purpose. This circular is to inform you of correct procedures
for making certain entries on Forms 2636 and 2731.
Background, We have been requested to clarify the procedure (a)
for recording on Form 2731 - Monthly Report of Bonded Storage Opera-
tions - losses sustained in bottling spirits or in packaging mingled
or blended spirits; and (b) for determining which quantity of spirits
should be entered at line 32 of Form 2636 - Daily Report of Transac-
tions - (1) the quantity dumped for bottling (column (d), Section II,
Form 1515) or (2) the quantity after reduction in proof (column (e),
Section III, Form 1515).
Procedure. First, Form 2731 is a balanced report, but it does not
include internal transactions, such as bottling in bond or mingling or
blending of spirits. Footnote 6 on Form 2731 states that line 20 covers
only storage losses; accordingly, where your bonded storage operations
include such internal transactions, and losses are sustained in bottling
spirits or in packaging mingled or blended spirits, you should enter
and appropriately identify such losses in an unused line on Form 2731
in order that the report will balance.
Second, the quantity of spirits reported at line 32 of Form 2636
should be the quantity determined by gauge at the time of dumping for
bottling in bond and entered in column (d), Section II of Form 1515.
This quantity would then represent the quantity of spirits used for
bottling. The difference between the quantity used and the quantity
bottled would represent the loss in bottling which would be entered in
Section IV of Form 1515, and in an unused line on Form 2731 as stated
Similarly, the quantity of spirits reported at lines 33 and 34 of
Form 2636 would be the quantity determined by gauge at the time of
dumping for blending or mingling, and entered on Form 1685 and Form
2323, respectively. Also, the loss in packaging such blended or
mingled spirits and entered in item 14 b of Form 1685 or item 18G of
Form 2323, as the case may be, should be entered in an unused line
on Form 2731 as stated above.
Inquiries. Inquiries regarding this circular should refer to
its number and be addressed to your assistant regional commissioner,
alcohol and tobacco tax.
Dwight E. Avis
Director, Alcohol and Tobacco Tax Division