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secure the right to carry on, without incurring additional special tax, the same business at the same place for the remainder of the taxable period for which the special tax was paid. The persons who may secure such right are:

(1) the surviving spouse or child, or executor or administrator or other legal representative, of a deceased taxpayer;

(2) a husband or wife succeeding to the business of his or her living spouse;

(3) a receiver or trustee in bankruptcy, or an assignee for benefit of creditors; and

(4) the partner or partners remaining after death or withdrawal of a member of a partnership.

When any person moves to any place other than the place for which special tax was paid for the carrying on of any business, he may secure the right to carry on, without incurring additional special tax, the same business at his new location for the remainder of the taxable period for which the special tax was paid. To secure the right to carry on the business without incurring additional special tax, the successor, or the person relocating his business, must register the succession or relocation with the Secretary in accordance with regulations prescribed by the Secretary.

(e) Federal agencies or instrumentalities

Any tax imposed by this part shall apply to any agency or instrumentality of the United States unless such agency or instrumentality is granted by statute a specific exemption from such tax.

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1347, and amended Pub. L. 94-455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.)

PRIOR PROVISIONS

A prior section 5143, act Aug. 16, 1954, ch. 736, 68A Stat. 624, related to time for filing returns and crossreferred to penalty provisions for failure to file returns or for making false or fraudulent returns, prior to the general revision of this chapter by Pub. L. 85-859. See subtitle F of this title.

Provisions similar to those comprising this section were contained in a prior section 5144, act Aug. 16, 1954, ch. 736, 68A Stat. 624, prior to the general revision of this chapter by Pub. L. 85-859.

AMENDMENTS

1976-Subsec. (d)(4). Pub. L. 94-455 struck out "or his delegate" following "Secretary".

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in section 5093 of this title.

[§ 5144. Repealed. Pub. L. 94-455, title XIX, § 1905(b)(3)(D)(i), Oct. 4, 1976, 90 Stat. 1822]

Section, added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1348, authorized and directed the Secretary or his delegate to procure the necessary stamps for the payment of special taxes and to make needful regulations relative thereto.

A prior section 5144, act Aug. 16, 1954, ch. 736, 68A Stat. 624, related to liability for occupational taxes, prior to the general revision of this chapter by Pub. L. 85-859. See sections 5113(a) and 5143 of this title.

EFFECTIVE DATE OF REPEAL

Section repealed by Pub. L. 94-455 effective on the first day of the first month which begins more than 90 days after Oct. 4, 1976, see section 1905(d) of Pub. L. 94-455, set out as an Effective Date of 1976 Amendment note under section 5005 of this title.

§ 5145. Application of State laws

The payment of any tax imposed by this part for carrying on any trade or business shall not be held to exempt any person from any penalty or punishment provided by the laws of any State for carrying on such trade or business within such State, or in any manner to authorize the commencement or continuance of such trade or business contrary to the laws of such State or in places prohibited by municipal law; nor shall the payment of any such tax be held to prohibit any State from placing a duty or tax on the same trade or business, for State or other purposes.

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1348.)

PRIOR PROVISIONS

A prior section 5145, act Aug. 16, 1954, ch. 736, 68A Stat. 625, related to "supply of stamps", prior to the general revision of this chapter by Pub. L. 85-859. See section 5144 of this title.

Provisions similar to those comprising this section were contained in a prior section 5148, act Aug. 16, 1954, ch. 736, 68A Stat. 626, prior to the general revision of this chapter by Pub. L. 85-859.

§ 5146. Preservation and inspection of records, and entry of premises for inspection

(a) Preservation and inspection of records

Any records or other documents required to be kept under this part or regulations issued pursuant thereto shall be preserved by the person required to keep such records or documents, as the Secretary may by regulations prescribe, and shall be kept available for inspection by any internal revenue officer during business hours.

(b) Entry of premises for inspection

The Secretary may enter during business hours the premises (including places of storage) of any dealer for the purpose of inspecting or examining any records or other documents required to be kept by such dealer under this chapter or regulations issued pursuant thereto and any distilled spirits, wines, or beer kept or stored by such dealer on such premises.

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1348, and amended Pub. L. 94-455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.)

PRIOR PROVISIONS

A prior section 5146, act Aug. 16, 1954, ch. 736, 68A Stat. 625, contained cross references to provisions respecting posting stamp in place of business, prior to the general revision of this chapter by Pub. L. 85-859. See sections 6806 and 7273 of this title.

Provisions similar to those comprising subsec. (a) of this section were contained in prior sections 5114(a) and 5124 (b), (c), act Aug. 16, 1954, ch. 736, 68A Stat. 619, 622, prior to the general revision of this chapter by Pub. L. 85-859.

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A prior section 5147, act Aug. 16, 1954, ch. 736, 68A Stat. 626, made a cross reference to provision respecting keeping of list of special taxpayers for public inspection, prior to the general revision of this chapter by Pub. L. 85-859.

Provisions similar to those comprising this section were contained in a prior section 5149, act Aug. 16, 1954, ch. 736, 68A Stat. 626, prior to the general revision of this chapter by Pub. L. 85-859.

§ 5148. Cross references

(1) For penalties for willful nonpayment of special taxes, see section 5691.

(2) For penalties applicable to this part generally, see subchapter J.

(3) For penalties, authority for assessments, and other general and administrative provisions applicable to this part, see subtitle F.

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1348, and amended Pub. L. 94-455, title XIX, § 1905(b)(3)(E), Oct. 4, 1976, 90 Stat. 1822.)

PRIOR PROVISIONS

A prior section 5148, act Aug. 16, 1954, ch. 736, 68A Stat. 626, related to "Application of State laws", prior to the general revision of this chapter by Pub. L. 85-859. See section 5145 of this title.

Provisions similar to those comprising subd. (1) of this section were contained in a prior section 5142(d), act Aug. 16, 1954, ch. 736, 68A Stat. 624, prior to the general revision of this chapter by Pub. L. 85-859.

A prior section 5149, act Aug. 16, 1954, ch. 736, 68A Stat. 626, related to "Application of subpart", prior to the general revision of this chapter by Pub. L. 85-859. See section 5147 of this title.

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Registration of stills.

Distilled spirits for fuel use.

Cross references.

PRIOR PROVISIONS

A prior subchapter B, Distilleries, consisted of part I. Establishment, part II, Operation, and part III, General Provisions Relating to Distilleries and Distilled Spirits, and consisted of sections 5171 to 5180, 5191 to 5197, and 5211 to 5217, respectively, prior to the general revision of this chapter by Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1313.

AMENDMENTS

1980-Pub. L. 96-223, title II, § 232(e)(2)(F), Apr. 2. 1980, 94 Stat. 280, added item 5181 and renumbered former item 5181 as 5182.

1979-Pub. L. 96-39, title VIII, § 807(b)(4), July 26, 1979, 93 Stat. 290, substituted "Bonds" for "Qualification bonds" in item 5173, struck out item 5174 "Withdrawal bonds", and substituted "Distilled spirits plants" for "Premises of distilled spirits plants" in item 5178.

SUBCHAPTER REFERRED TO IN OTHER SECTIONS This subchapter is referred to in sections 5002, 5601 of this title.

§ 5171. Establishment

(a) Certain operations may be conducted only on bonded premises

Except as otherwise provided by law, operations as a distiller, warehouseman, or processor may be conducted only on the bonded premises of a distilled spirits plant by a person who is qualified under this subchapter.

(b) Establishment of distilled spirits plant

A distilled spirits plant may be established only by a person who intends to conduct at such plant operations as a distiller, as a warehouseman, or as both.

(c) Registration

(1) In general

Each person shall, before commencing operations at a distilled spirits plant (and at such other times as the Secretary may by regulations prescribe), make application to the Secretary for, and receive notice of, the registration of such plant.

(2) Application required where new operations are added

No operation in addition to those set forth in the application made pursuant to paragraph (1) may be conducted at a distilled spirits plant until the person has made application to the Secretary for, and received notice of, the registration of such additional operation.

(3) Secretary may establish minimum capacity and level of activity requirements

The Secretary may by regulations prescribe for each type of operation minimum capacity

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and level of activity requirements for qualifying premises as a distilled spirits plant.

(4) Applicant must comply with law and regulations

No plant (or additional operation) shall be registered under this section until the applicant has complied with the requirements of law and regulations in relation to the qualification of such plant (or additional operation). (d) Permits

(1) Requirements

Each person required to file an application for registration under subsection (c) whose distilled spirits operations (or any part thereof) are not required to be covered by a basic permit under the Federal Alcohol Administration Act (27 U.S.C. secs. 203 and 204) shall, before commencing the operations (or part thereof) not so covered, apply for and obtain a permit under this subsection from the Secretary to engage in such operations (or part thereof). Subsections (b), (c), (d), (e), (f), (g), and (h) of section 5271 are hereby made applicable to persons filing applications and permits required by or issued under this subsection.

(2) Exceptions for agencies of a State or political subdivisions

Paragraph (1) shall not apply to any agency of a State or political subdivision thereof or to any officer or employee of any such agency, and no such agency, officer, or employee shall be required to obtain a permit thereunder.

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The Federal Alcohol Administration Act, referred to in subsec. (d)(1), is act Aug. 29, 1935, ch. 814, 49 Stat. 977, as amended, which is classified generally to chapter 8 (§ 201 et seq.) of Title 27, Intoxicating Liquors. The basic permit is covered by sections 203 and 204 of Title 27. For complete classification of this Act to the Code, see Tables.

PRIOR PROVISIONS

AMENDMENTS

1979-Subsec. (a). Pub. L. 96-39 added subsec. (a). Former subsec. (a) redesignated (c).

Subsec. (b). Pub. L. 96-39 added subsec. (b). Former subsec. (b) redesignated (d).

Subsec. (c). Pub. L. 96-39 redesignated former subsec. (a) as (c) and, as so redesignated, added provisions relating to an application requirement where new operations are added and permitting the Secretary to establish minimum capacity and level of activity requirements. Former subsec. (c) redesignated (e).

A prior section 5171, act Aug. 16, 1954, ch. 736, 68A Stat. 627, related to "premises prohibited for distilling", prior to the general revision of this chapter by Pub. L. 85-859. See sections 5178(a)(1)(B), (b), (c)(2), and 5505(b) of this title.

Subsec. (d). Pub. L. 96-39 redesignated former subsec. (b) as (d) and, as so redesignated, substituted reference to subsection (c) for reference to subsection (a) and struck out reference to section 5274.

Provisions similar to those comprising subsecs. (a), (b)(1) and (c) of this section were contained in prior sections of act Aug. 16, 1954, prior to the general revision of this chapter by Pub. L. 85-859, as follows:

Subsec. (e). Pub. L. 96-39 redesignated former subsec. (c) as (e) and, as so redesignated, substituted reference to processor for reference to rectifier and reference to warehouseman for reference to bonded warehouseman and struck out reference to bottler. 1976-Subsec. Pub. L. 94-455, §§ 1905(a)(13)(A), 1906(b)(13)(A), struck out "49 Stat. 978;" preceding “27 U.S.C. 203, 204" in the parenthetical provisions following "Federal Alcohol Administration Act" and struck out "or his delegate" following "Secretary".

(b)(1).

Subsec. (b)(3). Pub. L. 94-455, § 1905(a)(13)(B), struck out subsec. (b)(3) under which persons who were qualified on June 30, 1959, to perform operations for which a permit was required covering operations not required to be covered by a basic permit under the Federal Alcohol Administration Act had been allowed to continue operations pending a reasonable opportunity to make application for a permit.

EFFECTIVE DATE OF 1979 AMENDMENT Amendment by Pub. L. 96-39 effective Jan. 1, 1980, see section 810 of Pub. L. 96-39, set out as a note under section 5001 of this title.

EFFECTIVE DATE OF 1976 AMENDMENT Amendment by section 1905(a)(13) of Pub. L. 94-455 effective on the first day of the first month which begins more than 90 days after Oct. 4, 1976, see section 1905(d) of Pub. L. 94-455, set out as a note under section 5005 of this title.

EFFECTIVE DATE

Section effective July 1, 1959, see section 210(a)(1) of Pub. L. 85-859, set out as a note under section 5001 of this title.

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"(1) IN GENERAL.-For purposes of section 5171 of the Internal Revenue Code of 1954 (relating to establishment of distilled spirits plants), each person who intends to continue any distilled spirits operation at a premises after December 31, 1979, shall be treated as intending to establish a distilled spirits plant on such premises on January 1, 1980.

"(2) CURRENT REGISTRATION TO REMAIN IN EFFECT.— Notwithstanding paragraph (1), the registration of any person under section 5171 of the Internal Revenue Code of 1954 which is in effect on December 31,

1979, shall remain in effect until final action on the application required by paragraph (1).

"(b) CONTINUING OPERATIONS AT EXISTING PREMISES. With respect to any operation which was permitted to be conducted on May 1, 1979, at premises which were registered on such date under section 5171 of the Internal Revenue Code of 1954, the determination of whether such premises qualify for registration under such section as a distilled spirits plant shall be made without regard to whether or not—

"(1) the person engaged in operations at such premises is registered under such section with respect to such premises as a distiller or warehouseman, and

"(2) such premises meet the minimum capacity and level of activity requirements for that type of operation."

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 5172, 5178, 5601, 5681 of this title.

§ 5172. Application

The application for registration required by section 5171(c) shall, in such manner and form as the Secretary may by regulations prescribe, identify the applicant and persons interested in the business (or businesses) covered by the application, show the nature, location and extent of the premises, show the specific type or types of operations to be conducted on such premises, and show any other information which the Secretary may by regulations require for the purpose of carrying out the provisions of this chapter.

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1349, and amended Pub. L. 94-455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 96-39, title VIII, § 807(a)(13), July 26, 1979, 93 Stat. 282.)

PRIOR PROVISIONS

A prior section 5172, act Aug. 16, 1954, ch. 736, 68A Stat. 627, related to "conditions precedent to carrying on business of distilling", prior to the general revision of this chapter by Pub. L. 85-859 and is covered in part by this section. See also sections 5171(a), 5173(a), 5178(a)(1)(A), and 5601(a)(2), (4) of this title.

Provisions similar to those comprising this section were contained in prior sections 5175(a), 5178, 5231, 5243(a), 5271, 5301 to 5303, 5305, and 5331(a)(1), act Aug. 16, 1954, ch. 736, 68A Stat. 628, 631, 643, 645, 650, 654, 655, 657, 661, prior to the general revision of this chapter by Pub. L. 85-859.

AMENDMENTS

1979-Pub. L. 96-39 substituted "section 5171(c)" for "section 5171(a)".

1976-Pub. L. 94-455 struck out “or his delegate" following "Secretary" wherever appearing.

EFFECTIVE DATE OF 1979 AmendmeNT

Amendment by Pub. L. 96-39 effective Jan. 1, 1980, see section 810 of Pub. L. 96-39, set out as a note under section 5001 of this title.

§ 5173. Bonds

(a) Operations at, and withdrawals from, distilled spirits plant must be covered by bond

(1) Operations

No person intending to establish a distilled spirits plant may commence operations at such plant unless such person has furnished bond covering operations at such plant.

(2) Withdrawals

No distilled spirits (other than distilled spirits withdrawn under section 5214 or 7510) may be withdrawn from bonded premises except on payment of tax unless the proprietor of the bonded premises has furnished bond covering such withdrawal.

(b) Operations bonds

The bond required by paragraph (1) of subsection (a) shall meet the requirements of paragraph (1), (2), or (3) of this subsection:

(1) One plant bond

The bond covers operations at a single distilled spirits plant.

(2) Adjacent wine cellar bond

The bond covers operations at a distilled spirits plant and at an adjacent bonded wine cellar.

(3) Area bond

The bond covers operations at 2 or more distilled spirits plants (and adjacent bonded wine cellars) which

(A) are located in the same geographical area (as designated in regulations prescribed by the Secretary), and

(B) are operated by the same person (or, in the case of a corporation, by such corporation and its controlled subsidiaries).

(c) Withdrawal bonds

The bond required by paragraph (2) of subsection (a) shall cover withdrawals from 1 or more bonded premises the operations at which could be covered by the same operations bond under subsection (b).

(d) Unit bonds

Under regulations prescribed by the Secretary, the requirements of paragraphs (1) and (2) of subsection (a) shall be treated as met by a unit bond which covers both operations at, and withdrawals from, 1 or more bonded premises which could be covered by the same operations bond under subsection (b).

(e) Terms and conditions

(1) In general

Any bond furnished under this section shall be conditioned that the person furnishing the bond

(A) will faithfully comply with all provisions of law and regulations relating to the activities covered by such bond, and (B) will pay

(i) all taxes imposed by this chapter, and

(ii) all penalties incurred by, or fines imposed on, such person for violation of any such provision.

(2) Other terms and conditions

Any bond furnished under this section shall contain such other terms and conditions as may be required by regulations prescribed by the Secretary.

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The total amount of any bond furnished under this section shall be available for the satisfaction of any liability incurred under the terms and conditions of such bond.

(h) Special rules

For purposes of this section

(1) Withdrawal bonds

In the case of any bond furnished under this section which covers withdrawals but not operations—

(A) such bond shall be in addition to the operations bond, and

(B) if distilled spirits are withdrawn under such bond, the operations bond shall no longer cover liability for payment of the tax on the spirits withdrawn.

(2) Adjacent wine cellars

(A) Requirements

No wine cellar shall be treated as being adjacent to a distilled spirits plant unless

(i) such distilled spirits plant is qualified under this subchapter for the production of distilled spirits, and

(ii) such wine cellar and the distilled spirits plant are operated by the same person (or, in the case of a corporation, by such corporation and its controlled subsidiaries).

(B) Bond in lieu of wine cellar bond

In the case of any adjacent wine cellar, a bond furnished under this section which covers operations at such wine cellar shall be in lieu of any bond which would otherwise be required under section 5354 with respect to such wine cellar (other than supplemental bonds required under the second sentence of section 5354).

(Added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1349, and amended Pub. L. 91-659, § 4, Jan. 8, 1971, 84 Stat. 1966; Pub. L. 94-455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 96-39, title VIII, § 805(c), July 26, 1979, 93 Stat. 276.)

PRIOR PROVISIONS

A prior section 5173, act Aug. 16, 1954, ch. 736, 68A Stat. 628, related to "distillery fixtures and equipment", prior to the general revision of this chapter by Pub. L. 85-859. See sections 5178(a)(1)(A), (2)(B)(C), (c)(1) and 5202(b) of this title.

Provisions similar to those comprising subsecs. (a), (b), (b)(1), (b)(1)(A) to (C), (b)(3), (c), (c)(1), (d) and (e)(1) of this section were contained in prior sections of act Aug. 16, 1954, prior to the general revision of this chapter by Pub. L. 85-859, as follows:

(b) (b)(1)

(b)(1)(A)-(C)

(b)(3) (c). (c)(1).

(d) (e)(1).

5311(a)(3).

5176 (a), (d).

5176(a), 5177(c).

5177(b)(1)-(3).

5177(b)(4).

5232(a), 5302, 5303, 5306, 5331(a)(3). 5232(a).

5272(a).

5304(a)(5).

The prior sections, act Aug. 16, 1954, ch. 736, are set out in 68A Stat. 627, 629 to 631, 643, 650, 654, 655, 657, 662.

AMENDMENTS

1979-Pub. L. 96-39, among other changes, struck out provisions relating to liens on distillery property and the furnishing of indemnity bonds as methods of securing tax payments and added provisions relating to the one plant operations bond, which will cover the operations at a bonded wine cellar which is adjacent to the distilled spirits plant and operated by the same person.

1976-Pub. L. 94-455 struck out "or his delegate" following "Secretary" wherever appearing.

1971-Subsec. (b)(1). Pub. L. 91-659, § 4(b), extended the exception clause in the parenthetical part of this paragraph by making reference to cl. (4) of this subsection.

Subsec. (b)(2). Pub. L. 91-659, § 4(c), added reference to par. (4).

Subsec. (b)(4). Pub. L. 91-659, § 4(a), added par. (4).

EFFECTIVE DATE OF 1979 AMENDMENT Amendment by Pub. L. 96-39 effective Jan. 1, 1980, see section 810 of Pub. L. 96-39, set out as a note under section 5001 of this title.

EFFECTIVE DATE OF 1971 AMENDMENT

Amendment by Pub. L. 91-659 effective on the first day of the first calendar month which begins more than 90 days after January 8, 1971, see section 6 of Pub. L. 91-659, set out as an Effective Date note under section 5066 of this title.

TRANSITIONAL RULES RELATING TO ALL-IN-BOND
METHOD

Section 809(c) of Pub. L. 96-39 provided that: "For purposes of section 5173 of the Internal Revenue Code of 1954 (relating to bonds), each person who intends to continue operation at a premises after December 31, 1979, shall be treated as intending to establish a distilled spirits plant on such premises on January 1, 1980."

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 5005, 5175, 5176, 5177, 5213 of this title.

[§ 5174.

Repealed. Pub. L. 96-39, title VIII, § 807(a)(14), July 26, 1979, 93 Stat. 282]

Section, added Pub. L. 85-859, title II, § 201, Sept. 2, 1958, 72 Stat. 1352, and amended Pub. L. 94-455, title XIX, §§ 1905(a)(14), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1820, 1834, related to withdrawal bonds.

A prior section 5174, act Aug. 16, 1954, ch. 736, 68A Stat. 630, related to "registry of stills", prior to the general revision of this chapter by Pub. L. 85-859. See sections 5179 and 5505(d) of this title.

Provisions similar to those comprising subsec. (a)(1) of section 5174, added by Pub. L. 85-859, title I, § 201, Sept. 2, 1958, 725 Stat. 1352, relating to the withdrawal from bonded premises of distilled spirits on the furnishing of a bond by the proprietor of the bonded premises to secure payment of the tax on such spirits,

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