Pilot Brewing Plant Bond - Federal in All States

Brief Summary

A pilot brewing plant cannot brew a single test batch until TTB approves its bond. The amount follows a simple formula tied to how much beer you hold, it is capped at $50,000, and many small research setups land near the $500 floor. If your company already runs a brewery that pays tax quarterly or annually, you may not need it at all.

Anyone setting up a pilot brewing plant off brewery premises for research, analysis, experiments or development must file a Brewer's Bond, TTB F 5130.22, under 27 CFR 25.274. The penal sum equals the federal beer tax on the most beer on hand, in transit to the plant and unaccounted for at any one time, with a minimum of $500 and a maximum of $50,000. Operations cannot start until TTB approves the bond.

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How to Apply for a Pilot Brewing Plant Bond:

• Confirm you are not a qualified brewer exempt under 27 CFR 25.91(e).
• Estimate the most beer, in barrels, that will be on hand, in transit and unaccounted for at any one time.
• Multiply by the federal beer tax rate to set a penal sum between $500 and $50,000.
• Complete the bond application and review the premium quote.
• Execute TTB F 5130.22 marked for a pilot brewing plant.
• File the bond with your written pilot plant application to TTB and wait for approval before operating.

Detailed Information About the All States Pilot Brewing Plant Bond:

Check the exemption first

Under 27 CFR 25.274(d), you do not need this bond if you are a brewer qualified under part 25 who is exempt from brewer bond requirements under 25.91(e). That exemption covers brewers eligible to pay tax on an annual or quarterly return period. Under 25.164, the quarterly option is open to a taxpayer that owed no more than $50,000 in federal beer tax in the prior calendar year and reasonably expects to owe no more than $50,000 in the current year. A university lab, ingredient supplier or equipment maker with no qualified brewery does need the bond.

What a pilot brewing plant is

Section 25.271 lets a person run a pilot brewing plant away from brewery premises for research, analytical, experimental or developmental work on beer or brewery operations. Beer may leave the plant only for analysis or organoleptic examination, meaning tasting and sensory evaluation. Beer can move tax free between a pilot plant and a brewery of the same ownership. You apply in writing to TTB with your name and address, a description of the premises and equipment, the nature and extent of the work, and an agreement to follow part 25.

Bond amount

The penal sum is the potential tax on the largest quantity of beer that will be on hand, in transit to the plant and unaccounted for at any one time. Multiply that number of barrels by the beer tax rate in 26 U.S.C. 5051. The total, including any strengthening bond, cannot be less than $500 or more than $50,000.

What it guarantees

The bond is conditioned on the operator paying all federal taxes, penalties and interest it becomes liable for on beer brewed, produced or received at the plant. Operations may continue only while an approved bond is in effect, so a lapse stops the work.

Eligibility and Requirements for an All States Pilot Brewing Plant Bond:

• TTB F 5130.22, Brewer's Bond, identifying the pilot brewing plant.
• Penal sum of at least $500 and no more than $50,000.
• Alcohol and Tobacco Tax and Trade Bureau named as obligee for the United States.
• Approved bond in effect for as long as the plant operates.
• Consent of surety on TTB F 5000.18 to change bond terms.

All States Pilot Brewing Plant Bond FAQs:

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