Category Archives: Current Topics

How to KNOW your excise taxes (TTB) have REALLY been paid!
Posted on 2014-09-25 by Ann Reynolds

This headline in the wine industry last week caught my attention- Wine Cellar owner sentenced to prison . This was related to lack of payment of TTB excise taxes due for over a year’s period of time. The thing was, this business had been including on their customer’s invoices payments made for excise taxes but those taxes were never paid to the TTB, so the owner was just pocketing those amounts. 

The owner of this wine storage & shipment business was actually sentenced to 9 months of prison time in addition to restitution payment due to the TTB of closer to $900,000. That dollar figure would come from the past due tax payment amounts, late fees and penalties related to her knowing neglect in paying them.

But what about the wineries that stored their cased wines there? What about their responsibility? Are they in trouble with the TTB as well? No they are not, their responsibility would lie in the details of how they shipped their wines to the warehouse. The paperwork that goes along with a shipment of cased wine to a storage warehouse is called a bill of lading. (or what the TTB call a transfer in bond record) On their bill of lading a winery would have specifically indicated “transfer in bond” on it, meaning that the federal excise taxes had not been paid on those cased wines. This in turn generally means that when the winery receives an order for those wines it is forwarded to the warehouse for fulfillment and then they, the warehouse as the site that actually shipped the wines are required to file the federal excise tax report and submit payment to the TTB on the amount of wine shipped.

This is what all the winery customers of this warehouse in Salinas thought was happening, especially since they were seeing the tax payment amounts coming back to them on their invoices. Why would they have suspected otherwise?

The only way a winery can be 100% sure that all their TTB (And California BOE by the way too) excise tax payments have been made is if they are filing them themselves. 

What this scenario looks like is all of a winery’s cased wine shipments going to a wine warehouse for storage & fulfillment are all sent “Taxpaid”. This “taxpaid” statement is also indicated on the bill of lading sent with the wine to the warehouse, so the warehouse will know how to log in into their system and keep track. Plus it is also the start point indicator for the warehouse that they do NOT have to submit any of the tax filings/payments on shipments of those wines. The TTB excise tax reporting and tax payments are then fully the responsibility of the winery itself.

Another item of note related to this same issue I have heard several times in recent months is that some wine storage warehouses in Napa and Sonoma county are no longer willing to file TTB excise tax payments under the small producers tax credit. So for any of their winery clients that qualify for this hefty 0.90 cent a gallon tax credit they would essentially be telling them “if you want to take advantage of this huge tax savings on your wines, you’ll need to send them into us “Taxpaid””. Which would mean that the winery would document their bills of lading of cased wines being sent to their warehouse as “Taxpaid” and then follow up on those shipments for their next reporting period by submitting the TTB excise tax report along with payment.

For more info on the bill of lading document go here: BOL info

For more info on the TTB excise tax for the small producers credit go here: SPC tax info

To talk more about your winery records and reports please contact me here: ann@winecompliancealliance.com                  

OR     707-320-8575





Free Harvest compliance “Tips & Tricks”
Posted on 2014-09-10 by Ann Reynolds

Harvest 2014 while underway, has been a “start, stop” sort of harvest here in Napa so far. That is the picking began and then either slowed way down or stopped while waiting for the next round of grapes to hit the “ready” stage of ripe. 

Then of course here in Napa many wineries were hit to varying degrees by the earthquake over 2 weeks ago now, so the fact that grape deliveries had slowed down was actually a bit of a silver lining as the cleanup process had to be taken care of.

So as wineries get back in gear with harvest, which by nature is a chaotic & unpredictable event I’d like to offer some organizational assistance to reduce some of that chaos.

This assistance is my free “Harvest compliance Tips” list. These are designed to give you simple, specific guidance around your weigh tags, work orders and reports to:

  • Help keep your harvest numbers organized for later use
  • Keep you in the good graces of the TTB, and county Ag commissioner (both of these agencies can audit!)

If you’re someone who is responsible for completing weigh tags, or completing the CA Grape crush report- these compliance tips are for you.

Send me an email to sign up:      ann@winecompliancealliance.com

 

 





Wineries: No cross outs on your weigh tags!
Posted on 2014-08-21 by Ann Reynolds

It’s game on for crush 2014! I now regularly see trucks carrying those familiar white plastic bins on the roads here in Napa. Once the grapes start rolling in things heat up pretty fast. (No fermentation-related pun intended) Things can also quickly become rather chaotic when it comes to harvest related recordkeeping. Specifically your weigh tags. If you are someone who fills out weigh tags- I’ve got a warning reminder for you: one thing the county and the state do NOT want to see on your weigh tags: numbers that are crossed out. Those numbers would of course be your weights, the gross, tare and net that are filled out on a weigh tag. Continue reading





Yikes! Harvest 2014 is here! Does your compliance need a refresher?
Posted on 2014-08-04 by Ann Reynolds

The grape harvest is once again upon us. For all of you that actually means something to (all you hardworking winery folk!) you’re either excited to see it come, somewhat intrigued because it provides a change of pace or you’re very much in the “been there, done that” camp with the whole thing.

If you’re in either of the first two categories AND part of your job duties involve any of the following:

  • Filling out weigh tags for grape loads
  • processing work orders related to harvest
  • completing or submitting the TTB “702” or CA Grape crush reports

Listen up! Are you totally confident in these records & reports I mentioned? Confident that they would all meet the requirements of any of the following:

  • TTB audit
  • County AG commissioner audit
  • County Planning audit

If you either hesitated or thought “what’s an audit?” then chances are you’re a candidate to benefit from my webinar on Thursday, August 7th. Click here to sign up.

Each of the items mentioned, weigh tags, work orders and the two reports are required to list specific details and be completed in specific ways that are directly tied to TTB, California and county (Napa) regulations.

Listen in on the webinar to find out just what those are & see if your winery records are already set up to keep in the good graces of all 3 levels of government! Just click this link below to sign up:

“Have a Hassle Free Harvest” Webinar:   Thursday, August 7th   10:30 am to noon PST

Questions are welcome & encouraged! (specific to the topics covered of course)





What can & can’t be done right now while the TTB is shut down.
Posted on 2013-10-02 by Ann Reynolds

shutdownThe TTB is shutdown. Those were the words those of us in the compliance world of wine woke up to yesterday. It still sounds so surreal to me. So what exactly does it mean? For wineries? For those wanting to start their new wine business?

Here’s a brief summation of what “can” and what “can’t” currently be done right now depending on which category you fall into as well as my suggestions for what else to be doing right now to have ready for when the TTB comes back to life.

Continue reading





“I have known and worked with Ann for twelve years and her experience in production and consequently positions in wine/cellar tracking and compliance have always been innovative, timely and accurate. As the Quality Control Manager and lab director for Sterling Vineyards, Ann’s skills and work ethic have made the responsibilities and logistics of my position run smoothly and efficiently.”

Julianna Beckmann Gosling
Assistant Winemaker, Rob Lawson Consulting
What do the proposed Paso Robles AVAs mean for your weigh tags right now?
Posted on 2013-09-26 by Ann Reynolds

AVA

I see that 11 new petitions have recently been submitted to the TTB for new AVAs all within the current Paso Robles AVA. For one, that’s a lot of slicing and dicing all at once! And of course there has already been plenty of history to the quest to create several more sub-AVAs within the sizeable piece of land that the parent AVA Paso Robles already is. (5th largest in California)

Continue reading





What does wine production really mean?
Posted on 2013-09-09 by Ann Reynolds

napa-county-logo-150x150

I’ve recently read some articles about random audits here in Napa county conducted by the planning office. These random audits occur annually on 5% of Napa’s wineries which hold use permits with the county planning office. One of the key items they are looking at during these audits is a winery’s production gallons. The term production gets tossed around a lot in the wine business. It means different things to the different people and different agencies connceted to it, and in my world of compliance it has very specific definitions given to it by government agencies such as the county planning office in this case. It is also a specifically defined term used by the Alcohol Tobacco Tax & Trade Bureau (TTB). Do you know the difference in definition between those two agencies and how it can impact your winery?

Continue reading





TTB Label Approvals……Make Sure to Plan Ahead!
Posted on 2013-05-01 by Ann Reynolds

Wineries beware! TTB label approval times are now back up to over 30 days!
Here is my post from 2 years ago w/info on how you can plan ahead for this necessary step in the process:

All wines that are bottled by wineries to be sold for consumption are required to have a federal label approval. The industry term for this is certificate of label approval, or COLA. Of the three alcoholic beverage categories (Beer, Wine and spirits) the number of applications for label approval received by the federal regulating agency, the TTB from the wine industry makes up over 80% of the total. Add to this scenario the current government budget issues which have resulted in staff cuts and retirements at the TTB and the end result is label approval processing time has gone up. Many in the industry had become accustomed to their label approval turn around time lasting about 10 working days. (This is for those using the TTB’s electronic filing system, COLAs Online) That time frame now has now gone up to 38 Days!

Continue reading





2012 Winery Compliance Wrap Up…….& What To Watch For in 2013.
Posted on 2012-12-30 by Ann Reynolds

Here we are at years end. A time often focused on assessing the years events & developments, ups and downs. For the winemaking world 2012 has already been marked as an incredible one in relation specifically to the grape harvest. (At least here in California) But what about in relation to compliance? What were the stories there? And what’s to come for wineries in 2013 that they’ll want to pay attention to for keeping on top of their compliance?

Continue reading





Wineries – Are You Out of Bounds on Your Bond?
Posted on 2012-11-08 by Ann Reynolds

I recently wrote a post about one of the potential compliance side effects related to this years high yield harvest. Afterwards, while I was talking to a client I was reminded of another potential compliance issue. He asked about the topic of bond coverage and what happens if wineries go outside their limits.

First, let me put all of that into laymans terms and how it ties into this years high volume harvest. All wineries have specific bond coverage (TTB requirement) which is an insurance policy that covers the total tax liability for wines they have on their site at any given time. If their total volume goes over that coverage amount  in the event of an accident or  an audit they would be outside their coverage amounts on their TTB reports. In both cases something they can be fined for or worse, held responsible for tax liability on wine that accidentally was lost.

Continue reading