WINE CREDIT FOR SMALL DOMESTIC PRODUCERS
To Bonded Wine Premises Proprietors and Others Concerned:
Purpose. This circular supplements Industry Circular
90-4, dated November 26, 1990, by giving specific instructions on
the method for taking the wine tax credit under the provisions of
the Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508,
104 Stat., 1388).
Showing the credit on the wine tax return. If you
are eligible for a tax credit during a particular tax return period,
show the full amount of wine tax due without credit on line 10 of
ATF Form 5000.24. Enter the amount of wine subject to credit and
the applicable credit rate as an adjustment decreasing the amount
of tax due in Schedue B of the return. Show the total of all decreasing
adjustments on Line 20. If you choose to apply the credit against
any other tax, show the credit earned, the form number of the return
where you plan to use the credit and the due date for that form.
Do not deduct the amount from your wine tax return.
Claim for refund or credit of excessively paid taxes. If you do not expect to qualify for a tax credit during a calendar
year and you pay tax at the full rate, you may find later in the
year that you are eligible for a credit, or a larger credit than
the one you actually took. In such a situation, you may file a claim
for refund or credit of the tax you overpaid. The claim form and
procedure are the same as for any refund or credit of wine taxes.
Repayment of credit erroneously taken. If your production
for a calendar year exceeds the estimated production figure you
used in computing your credit, and you have reduced the amount of
taxes you paid by the erroneous credit, you must repay the difference
between the tax you paid and the tax you should have paid. Show
the repayment as an adjustment increasing the amount due on Schedule
A of your next tax return, along with interest computed from the
date you filed each return reflecting the erroneous credit to the
date of the adjustment. On request, your regional office will provide
information about interest rates. Show the total of all increasing
adjustments on line 18. A taxpayer who overclaims credit through
negligence or fraud is subject to penalties.
Effective date. The increased taxes and the provision
allowing the small producer credit are both effective January 1,
Inquiries. If you have any questions, please contact
your ATF regional office.