Title 26 — Internal Revenue CodeRelease 119-73
§5111 Eligibility
Title 26 › Subtitle Subtitle E— - Alcohol, Tobacco, and Certain Other Excise Taxes › Chapter CHAPTER 51— - DISTILLED SPIRITS, WINES, AND BEER › Subchapter Subchapter A— - Gallonage and Occupational Taxes › Part PART II— - MISCELLANEOUS PROVISIONS › Subpart Subpart B— - Nonbeverage Domestic Drawback Claimants › § 5111
Summary
People using taxed distilled spirits to make products not fit to drink (like medicines, flavorings, food items, or perfume) can get a tax refund under these rules.
Full Legal Text
Title 26, §5111
Internal Revenue Code — Source: USLM XML via OLRC
Any person using distilled spirits on which the tax has been determined, in the manufacture or production of medicines, medicinal preparations, food products, flavors, flavoring extracts, or perfume, which are unfit for beverage purposes shall be eligible for drawback at the time when such distilled spirits are used in the manufacture of such products as provided for in this subpart.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Prior Provisions
A prior section 5111, added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1340; amended Pub. L. 94–455, title XIX, § 1905(b)(3)(B), Oct. 4, 1976, 90 Stat. 1822; Pub. L. 100–203, title X, § 10512(b), Dec. 22, 1987, 101 Stat. 1330–448, related to tax on wholesale dealers in liquors or beer, prior to repeal by Pub. L. 109–59, title XI, § 11125(a)(1)(C), (c), Aug. 10, 2005, 119 Stat. 1953, 1957, effective July 1, 2008, but inapplicable to taxes imposed for periods before such date. Another prior section 5111, act Aug. 16, 1954, ch. 736, 68A Stat. 618, related to tax on wholesale and retail dealers in liquors or beer, prior to the general revision of this chapter by Pub. L. 85–859.
Amendments
2005—Pub. L. 109–59, § 11125(b)(3)(C), struck out “and rate of tax” after “Eligibility” in section catchline, struck out “(a) Eligibility for drawback” before “Any person”, and struck out subsec. (b). Text read as follows: “The special tax imposed by subsection (a) shall be $500 per year.” Pub. L. 109–59, § 11125(b)(3)(A), renumbered section 5131 of this title as this section. Subsec. (a). Pub. L. 109–59, § 11125(a)(2), struck out “, on payment of a special tax per annum,” after “beverage purposes”. 1994—Subsec. (a). Pub. L. 103–465 substituted “flavoring extracts, or perfume” for “or flavoring extracts”. 1987—Subsec. (b). Pub. L. 100–203 amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “The special tax imposed by subsection (a) shall be graduated in amount as follows: (1) for total annual use not exceeding 25 proof gallons, $25 a year; (2) for total annual use not exceeding 50 proof gallons, $50 a year; (3) for total annual use of more than 50 proof gallons, $100 a year.” 1976—Subsec. (a). Pub. L. 94–455 struck out “produced in a domestic registered distillery or industrial alcohol plant and withdrawn from bond, or using distilled spirits withdrawn from the bonded premises of a distilled spirits plant,” after “Any person using distilled spirits”.
Statutory Notes and Related Subsidiaries
Effective Date
of 2005 AmendmentAmendment by Pub. L. 109–59 effective July 1, 2008, but inapplicable to taxes imposed for periods before such date, see section 11125(c) of Pub. L. 109–59, set out as a note under section 5002 of this title.
Effective Date
of 1994 AmendmentAmendment by Pub. L. 103–465 effective Jan. 1, 1995, see section 136(d) of Pub. L. 103–465, set out as a note under section 5001 of this title.
Effective Date
of 1987 Amendment Pub. L. 100–203, title X, § 10512(h), Dec. 22, 1987, 101 Stat. 1330–450, provided that: “(1) In general.—The
Amendments
made by this section [enacting section 5081, 5276, and 5731 of this title and amending this section and section 5091, 5121, 5131, 5691, and 5801 of this title] shall take effect on
January 1, 1988. “(2) All taxpayers treated as commencing in business on january 1, 1988.—“(A) In general.—Any person engaged on
January 1, 1988, in any trade or business which is subject to an occupational tax shall be treated for purposes of such tax as having 1st engaged in such trade or business on such date. “(B) Limitation on amount of tax.—In the case of a taxpayer who paid an occupational tax in respect of any premises for any taxable period which began before
January 1, 1988, and includes such date, the amount of the occupational tax imposed by reason of subparagraph (A) in respect of such premises shall not exceed an amount equal to ½ the excess (if any) of—“(i) the rate of such tax as in effect on
January 1, 1988, over “(ii) the rate of such tax as in effect on
December 31, 1987. “(C) Occupational tax.—For purposes of this paragraph, the term ‘occupational tax’ means any tax imposed under part II of subchapter A of chapter 51, section 5276, section 5731, or section 5801 of the Internal Revenue Code of 1986 (as amended by this section). “(D) Due date of tax.—The amount of any tax required to be paid by reason of this paragraph shall be due on
April 1, 1988.”
Effective Date
of 1976 AmendmentAmendment by Pub. L. 94–455 effective on first day of 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.
Reference
Citations & Metadata
Citation
26 U.S.C. § 5111
Title 26 — Internal Revenue Code
Last Updated
Apr 6, 2026
Release point: 119-73