Rev. Proc. 61-2

SECTION 1. PURPOSE.

The purpose of this Revenue Procedure is to set forth the procedures for (1) recording on Form 2730, Monthly Report of Production Operations, and Form 2731, Monthly Report of Bonded Storage Operations, spirits produced at 190 degrees or more of proof and subsequently reduced below 190 degrees of proof and (2) recording on Form 2730 recovered denatured spirits (or articles) and unfinished spirits.

SEC. 2. BACKGROUND.

Section 201.633 of the Distilled Spirits Plants Regulations requires proprietors conducting production operations and proprietors conducting bonded storage operations to report such operations on Forms 2730 and 2731, respectively, at the end of such month. Several questions have been presented concerning the proper accounting on Forms 2730 and 2731 for (1) spirits produced at 190 degrees or more of proof and subsequently reduced below 190 degrees of proof, (2) recovered denatured spirits (or articles), and (3) unfinished spirits.

SEC. 3. REPORTING REQUIREMENTS.

.01 Alcoholic or spirits (other than denatured spirits) produced at 190 degrees or more of proof, as determined at the time of production gauge, whether or not such alcohol or spirits are subsequently reduced in proof below 190 degrees, shall be reported in column (g) of Form 2730 or Form 2731, as applicable. Alcohol or spirits produced below 190 degrees of proof shall be reported in column (h) of Form 2730 or Form 2731, as applicable.

.02 Recovered denatured spirits (or articles) received for redistillation shall be reported on line 15 of Form 2730 in column (i).

.03 All spirits (including denatured spirits) which have been received during previous months or during the current month for redistillation, but which have not yet been fed into the distilling system for that purpose, shall be reported on line 17(a) of Form 2730.

.04 Unfinished spirits, high and low wines, and other spirits in tanks or other vessels on which a production gauge has not yet been taken shall be reported on line 17(b) of Form 2730 in column (i).

.05 When spirits of 190 degrees or more of proof are produced by redistillation, the entry for the kind of material used shall be shown in Section II of Form 2730 as `Alcohol-Cane, redistilled,' `Alcohol-Petroleum, redistilled,' `bourbon whisky, redistilled,' etc., as applicable.

.06 Entries in Section IV of Form 2730 shall show the quantities of spirits fed into the distilling system during the month for redistillation. For alcohol other than denatured alcohol or recovered denatured alcohol, these entries shall include the proof of original production as either `190 degrees or more of proof' or `under 190 degrees of proof,' whichever is applicable.

SEC. 4. INQUIRIES.

Inquiries regarding this Revenue Procedure should refer to its number and be addressed to the office of the appropriate Assistant Regional Commissioner, Alcohol and Tobacco Tax.