(Wines&Vines) - On Aug. 29, the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) issued answers to frequently asked questions for vintners and allied businesses affected by the magnitude-6.0 earthquake felt throughout the Bay Area five days earlier.

The quake, which has been followed by a succession of aftershocks, caused damages in the Napa County, Calif., area estimated from $50 million to more than $1 billion—including widespread structural damages, loss of equipment and loss of wine in tanks, barrels and bottles.

TTB does not address structural or equipment damage, but its regulations do permit the agency to authorize excise tax relief in the form of refunds or credits for wine losses. Under the emergency provisions, reporting deadlines may also be waived. Retailers, wholesalers and importers may also request refunds for federal excise taxes paid for lost or condemned alcoholic beverages.

Although normal regulations require proprietors to report casualty losses immediately, “Due to the extent of damage caused by the Aug. 24 earthquake,” the agency has waived that requirement. “Proprietors should instead report their losses as soon as they are able to determine the extent of the damage to their inventories,” the TTB statement read.

In normal circumstances, owners must request TTB permission to destroy wine that is “condemned” for safety reasons. This requirement is also waived. “However, proprietors must still submit a notification as soon as is practical….Please note that the wine must be destroyed in compliance with your local environmental and waste-disposal rules,” TTB cautioned.
Transferring bonded wine to another bonded location for safekeeping and later transferred back to your winery, TTB said, “will not affect your ability to take the small-producer credit,” which is limited to 250,000 gallons produced per year. Only wine produced by your winery is eligible.