What state and federal reports does a craft (farm) distillery have to file and when?

What state and federal reports does a craft (farm) distillery have to file and when?

New distillery operators often ask what reports they must file concerning their production operations. There are both state and federal filing requirements in New York, and for distilleries operating within the City of New York, there may be additional requirements. The most important filing requirements are described below, but this is not an exhaustive list because it focuses on operational reports and excise taxes for alcohol production. Consult your accountant and attorney to identify requirements applicable to your business and its full scope of operations that may include more than alcoholic beverage production. Working with an experienced alcoholic beverage legal and tax professional can be beneficial in this industry to avoid any fines and penalties for missing required reports.

Distillers must file monthly federal operations reports including reports of Production (F5110.40), Storage (F5110.11), and Processing (F5110.28) operations. These reports detail the amount of product being produced and in various stages of production “in bond.”

In addition, distillers must file a Federal Excise Tax return (F5000.24) and pay all taxes owed at the close of each tax period. The frequency of excise filing depends on the annual tax liability. Farm distilleries that produce nano to small production volumes generally fall within one of these two categories: 1) less than $1,000 in excise tax paid the prior year and expect to pay less than $1,000 in excise tax this year – (file annually); or, 2) paid more than $1000 but less than $50,000 in tax in the prior year and expect to pay less than $50,000 in tax this year – (file quarterly).

At the state level, producers qualify as “distributors of alcoholic beverages in New York State” and must be registered with the Tax Department for the alcoholic beverages tax (ABT) and file either Form MT-456 and MT-456-ATT. Returns are due on either a monthly or annual basis depending on your license type. These reported amounts should only include alcoholic beverages that are finished and ready for sale.

For distilleries selling at retail (especially by the glass sales in a tasting room), they will also be required to file sale tax returns. How frequently you must file sales tax returns depends on the amount of your taxable sales (and purchases subject to use tax), or the amount of tax due. Even if your business did not make any taxable sales or purchases during the reporting period, you must file your sales and use tax return by the due date reporting no sales during the tax period. The “default” is a quarterly return. You may file annually, however, if you owe $3,000 or less in tax during an annual filing period. Moreover, some producers may be subject to filings as bottle deposit initiators depending on what bottled and canned products they produce.

Tracy Jong is a Senior attorney at Evans Fox LLP with 30 years of experience focusing her practice in business law, intellectual property and licensing for alcohol and cannabis. Tracy Jong is a member of the New York Bar and is a registered attorney at the United States Patent and Trademark Office. She can be reached at [email protected].


The content has been prepared for informational purposes only; it should not be construed as legal or tax advice, does not create or constitute an attorney-client relationship, and readers should not act upon it without seeking professional counsel.