Distilled spirits lost or destroyed in bond
Extent of loss allowance
Theft
In the case of loss by theft, unless the Secretary finds that the theft occurred without connivance, collusion, fraud, or negligence on the part of the proprietor of the distilled spirits plant, owner, consignor, consignee, bailee, or carrier, or the employees or agents of any of them;
Voluntary destruction
In the case of voluntary destruction, unless such destruction is carried out as provided in subsection (b); and
Unexplained shortage
In the case of an unexplained shortage of bottled distilled spirits.
Proof of loss
In any case in which distilled spirits are lost or destroyed, whether by theft or otherwise, the Secretary may require the proprietor of the distilled spirits plant or other person liable for the tax to file a claim for relief from the tax and submit proof as to the cause of such loss. In every case where it appears that the loss was by theft, the burden shall be upon the proprietor of the distilled spirits plant or other person responsible for the distilled spirits tax to establish to the satisfaction of the Secretary that such loss did not occur as the result of connivance, collusion, fraud, or negligence on the part of the proprietor of the distilled spirits plant, owner, consignor, consignee, bailee, or carrier, or the employees or agents of any of them.
Refund of tax
In any case where the tax would not be collectible by virtue of paragraph (1), but such tax has been paid, the Secretary shall refund such tax.
Limitations
Except as provided in paragraph (5), no tax shall be abated, remitted, credited, or refunded under this subsection where the loss occurred after the tax was determined (as provided in section 5006(a)). The abatement, remission, credit, or refund of taxes provided for by paragraphs (1) and (3) in the case of loss of distilled spirits by theft shall only be allowed to the extent that the claimant is not indemnified against or recompensed in respect of the tax for such loss.
Applicability
The provisions of this subsection shall extend to and apply in respect of distilled spirits lost after the tax was determined and before completion of the physical removal of the distilled spirits from the bonded premises.
Voluntary destruction
The proprietor of the distilled spirits plant or other persons liable for the tax imposed by this chapter or by section 7652 with respect to any distilled spirits in bond may voluntarily destroy such spirits, but only if such destruction is under such supervision and under such regulations as the Secretary may prescribe.
Distilled spirits returned to bonded premises
In general
Whenever any distilled spirits on which tax has been determined or paid are returned to the bonded premises of a distilled spirits plant under section 5215(a), the Secretary shall abate or (without interest) credit or refund the tax imposed under section 5001(a)(1) (or the tax equal to such tax imposed under section 7652) on the spirits so returned.
Claim must be filed within 6 months of return of spirits
No allowance under paragraph (1) may be made unless claim therefor is filed within 6 months of the date of the return of the spirits. Such claim may be filed only by the proprietor of the distilled spirits plant to which the spirits were returned, and shall be filed in such form as the Secretary may by regulations prescribe.
Distilled spirits withdrawn without payment of tax
Other laws applicable
All provisions of law, including penalties, applicable in respect of the internal revenue tax on distilled spirits, shall, insofar as applicable and not inconsistent with subsection (c), be applicable to the credits or refunds provided for under such subsection to the same extent as if such credits or refunds constituted credits or refunds of such tax.
Cross reference
For provisions relating to allowance for loss in case of wine spirits withdrawn for use in wine production, see section 5373(b)(3).
Pub. L. 85–859, title II, § 20172 Stat. 1323 Pub. L. 89–44, title VIII, § 805(a)79 Stat. 160 Pub. L. 90–630, § 182 Stat. 1328 Pub. L. 91–65984 Stat. 1964 Pub. L. 94–273, § 4790 Stat. 382 Pub. L. 94–455, title XIX90 Stat. 1818 Pub. L. 95–17691 Stat. 1364 Pub. L. 96–39, title VIII, § 807(a)(6)93 Stat. 281 Pub. L. 105–34, title XIV, § 1411(a)111 Stat. 1046 (Added , , ; amended , , ; , , ; , §§ 1, 2(a), (b), , ; , , ; , §§ 1905(a)(2), 1906(b)(13)(A), , , 1834; , §§ 2(f), 4(e), , , 1366; , , ; , , .)
Editorial Notes
Prior Provisions
act Aug. 16, 1954, ch. 736 68A Stat. 602 Pub. L. 85–859A prior section 5008, , , consisted of provisions similar to those comprising this section, prior to the general revision of this chapter by . See sections 5205(a), (g) and 5604(a)(1) of this title.
act Aug. 16, 1954, ch. 736 68A Stat. 604 Pub. L. 85–859Provisions similar to those comprising subsecs. (a)(1) to (4) and (f)(1), (2) of this section were contained in prior sections 5011(a)(1) to (4), 5023, 5247(e) and 5522(b), , , 606, 648, 679, prior to the general revision of this chapter by .
Amendments
Pub. L. 105–341997—Subsec. (c)(1). substituted “on which tax has been determined or paid” for “withdrawn from bonded premises on payment or determination of tax”.
Pub. L. 96–39, § 807(a)(6)(A)1979—Subsec. (a)(1)(C). , added subpar. (C).
Pub. L. 96–39, § 807(a)(6)(B)Subsec. (a)(5). , substituted “before” for “prior to the completion” and struck out provisions relating to the applicability of this subsection where the loss occurred after the time prescribed for the withdrawal of the distilled spirits from the bonded premises under section 5006(a)(2) and relating to the applicability of this paragraph to any loss of distilled spirits for which abatement, remission, credit, or refund of tax is allowed under subsec. (c).
Pub. L. 96–39, § 807(a)(6)(C)Subsec. (b). , struck out “(1) Distilled spirits in bond” before “The proprietor of” and provisions relating to distilled spirits withdrawn for rectification or bottling.
Pub. L. 96–39, § 807(a)(6)(C)Subsec. (c). , added subsec. (c). Former subsec. (c), which related to loss of distilled spirits withdrawn from bond for rectification or bottling, was struck out.
Pub. L. 96–39, § 807(a)(6)(D)Subsec. (d). , redesignated subsec. (f) as (d). Former subsec. (d), which related to distilled spirits returned to bonded premises, was struck out.
Pub. L. 96–39, § 807(a)(6)(D)Subsec. (e). , (E), redesignated subsec. (g) as (e) and substituted “subsection (c)” for “subsections (b)(2), (c), and (d)” and “under such subsection” for “under such subsections”. Former subsec. (e), which related to samples of distilled spirits used for analysis or testing by United States, was struck out.
Pub. L. 96–39, § 807(a)(6)(D)Subsec. (f). , redesignated subsec. (h) as (f). Former subsec. (f) redesignated (d).
Pub. L. 96–39, § 807(a)(6)(D)Subsecs. (g), (h). , redesignated subsecs. (g) and (h) as (e) and (f), respectively.
Pub. L. 95–176, § 2(f)1977—Subsec. (d). , reenacted par. (1) and substituted heading “General” for “Allowance of tax” and “(or the tax equal to such tax imposed under section 7652)” for “or under section 7652”; added pars. (2) and (3); and redesignated as par. (4) provisions of former par. (2) and inserted reference to allowance of claims under par. (2) or (3).
Pub. L. 95–176, § 4(e)Subsec. (f)(5). , added par. (5).
Pub. L. 94–4551976—Subsec. (b)(1). , §§ 1905(a)(2)(A), 1906(b)(13)(A), inserted “or by section 7652” after “tax imposed by this chapter” and struck out “or his delegate” after “Secretary”.
Pub. L. 94–455Subsec. (b)(2). , §§ 1905(a)(2)(B), 1906(b)(13)(A), struck out “or his delegate” after “Secretary” and inserted “, or under section 7652” after “under subpart B of this part”.
Pub. L. 94–455Subsec. (c)(1). , §§ 1905(a)(2)(C), 1906(b)(13)(A), struck out “or his delegate” after “Secretary” wherever appearing and inserted “or under section 7652” after “under section 5001(a)(1)”.
Pub. L. 94–273Subsec. (c)(2), (3). substituted “computation year” for “fiscal year” wherever appearing.
Pub. L. 94–455, § 1906(b)(13)(A)Subsec. (c)(5). , struck out “or his delegate” after “Secretary”.
Pub. L. 94–455Subsec. (d)(1). , §§ 1905(a)(2)(C), (D), 1906(b)(13)(A), struck out “on or after ,” after “from bonded premises,” and “or his delegate” after “Secretary” and inserted “or under section 7652” after “under section 5001(a)(1)”.
Pub. L. 91–659, § 2(a)1971—Subsec. (b)(2). , struck out condition that the distilled spirits can be destroyed only before bottling and permitted destruction after completion of bottling so long as the distilled spirits are on the bottling premises and added taxes imposed under subpart B of this Part as additional taxes which can be claimed for abatement, remission, credit or refund.
Pub. L. 91–659, § 1Subsec. (c)(1)(A). , added cl. (iii).
Pub. L. 91–659, § 2(b)Subsec. (c)(5). , permits distilled spirits returned to bottling premises to be treated for purposes of the various loss provisions as though they had not been removed from the bottling premises.
Pub. L. 90–6301968—Subsec. (c)(1). inserted provisions allowing abatement, remission, and refund if the casualty loss occurs after completion of the packaging but before the spirits have been removed from the premises of the distilled spirits plant to which the spirits were removed from bond.
Pub. L. 89–441965—Subsec. (d)(2). struck out final clause prohibiting the allowance of a claim in respect to any distilled spirits withdrawn from bonded premises of a distilled spirits plant more than 6 months prior to the date of such return.
Statutory Notes and Related Subsidiaries
Effective Date of 1997 Amendment
Pub. L. 105–34, title XIV, § 1411(b)111 Stat. 1046
Effective Date of 1979 Amendment
Pub. L. 96–39section 810 of Pub. L. 96–39section 5001 of this titleAmendment by effective , see , set out as a note under .
Effective Date of 1977 Amendment
Pub. L. 95–176section 7 of Pub. L. 95–176section 5003 of this titleAmendment by effective on first day of first calendar month beginning more than 90 days after , see , set out as a note under .
Effective Date of 1976 Amendment
section 1905(a)(2) of Pub. L. 94–455section 1905(d) of Pub. L. 94–455section 5005 of this titleAmendment by effective on first day of first month which begins more than 90 days after , see , set out as a note under .
Effective Date of 1971 Amendment
Pub. L. 91–659section 6 of Pub. L. 91–659section 5066 of this titleAmendment by effective on first day of first calendar month which begins more than 90 days after , see , set out as an Effective Date note under .
Effective Date of 1968 Amendment
Pub. L. 90–630, § 482 Stat. 1329
Effective Date of 1965 Amendment
Pub. L. 89–44, title VIII, § 805(g)(1)79 Stat. 162
Distilled Spirits Returned to Bonded Premises of Distilled Spirits Plant During 1980
section 5041 of this titlesection 808(d) of Pub. L. 96–39section 5061 of this titleSubsec. (c)(1) of this section to be treated as including a reference to with respect to distilled spirits returned to the bonded premises of distilled spirits plants during 1980, see , set out as a note under .