About Federal Excise Taxes on Food Grade Ethanol

Food grade non-denatured ethanol is regulated and taxed by Tax and Trade Bureau (TTB.gov), a Department of the Internal Revenue Service (IRS.gov).  This page contains more information related to Federal Excise Taxes applied to food grade ethanol products.

Q:  Do I have to pay the Federal Excise Tax is my use is "non-beverage"?

Answer: Yes, the Federal Excise Tax must be paid even if your final use is not for beverage purposes.  Non-beverage use customers may apply for Excise Tax Drawback from the TTB to have their excise taxes paid on non-beverage ethanol returned.  

Q:  What is the Federal Excise Tax Rate for Non-Denatured Ethanol?

Answer: The TTB publishes tables with the applicable tax rate for each year.  Use this link to find current tax rate information.  Current Federal Excise Tax Tables: https://www.ttb.gov/tax-audit/tax-and-fee-rates

 

Q:  Do States also apply an excise tax on non-denatured ethanol?

Answer: Some states may apply an excise tax, typically this comes in the form of a permit fee required before purchase. 

Q:  What is my State's additional individual excise tax on non-denatured ethanol?

Answer: Each and every state's alcohol laws are different.  If a state charges an excise tax they typically do so in the form of a permit application.  We recommend you contact your state's individual revenue department to inquire on specific requirements for your situation and use case.  Use the resources provided on our Permit page to contact your state's revenue department and inquire more.

Q:  How do I get my Federal excise tax back from the TTB?

Answer:  Drawback is the term used by the TTB for requesting back taxes paid but not owed.

When a manufacturer uses that tax-paid alcohol in a non-beverage way, then a claim for the return of most of the excise tax (known as drawback) can occur.  Products seeking drawback must apply to the Nonbeverage Products Laboratory for analysis and confirmation that the formula is "unfit for beverage purposes".   Certain "for example" non-beverage use cases include: food products including baked goods and glazes, flavor extracts, medicines, concentrates, perfumes, and cocktail bitters.

For more information on Excise Tax Drawback steps, visit: https://www.ttb.gov/scientific-services-division/nonbeverage-drawback-alcohol

 


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