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Title 26, Internal Revenue CodeRelease 119-110

§5042 Exemption From Tax

Title 26 › Subtitle E — Alcohol, Tobacco, and Certain Other Excise Taxes › CHAPTER 51 — DISTILLED SPIRITS, WINES, AND BEER › Subchapter A — Gallonage and Occupational Taxes › PART I — GALLONAGE TAXES › Subpart C — Wines › § 5042

Last updated Sep 22, 2026|Official source

Summary

Certain apple cider, small amounts of homemade wine, and wine made for research are not taxed under rules set by the Secretary. Apple cider that is made only from apple juice, is still (not fizzy), is made outside a bonded wine cellar, uses no preservatives, and is sold as cider (not as wine or a wine substitute) is not treated as taxable wine and is not covered by the usual wine-tax rules. Any adult may make wine at home without paying tax as long as it is for personal or family use and not for sale. A household may have up to 200 gallons per year if it has two or more adults, or up to 100 gallons if it has one adult. “Adult” means someone who is at least 18 or the local minimum age to buy wine, whichever is higher. Colleges and research institutions may also make, blend, store, and get spirits for experimental wine work without paying tax, but not for regular drinking (other than taste tests) or for sale.

Full Legal Text

Title 26, §5042

Internal Revenue Code, Source: USLM XML via OLRC

(a)Tax-free production
(1)Cider
Subject to regulations prescribed by the Secretary, the noneffervescent product of the normal alcoholic fermentation of apple juice only, which is produced at a place other than a bonded wine cellar and without the use of preservative methods or materials, and which is sold or offered for sale as cider and not as wine or as a substitute for wine, shall not be subject to tax as wine nor to the provisions of subchapter F.
(2)Wine for personal or family use
Subject to regulations prescribed by the Secretary—
(A)Exemption
Any adult may, without payment of tax, produce wine for personal or family use and not for sale.
(B)Limitation
The aggregate amount of wine exempt from tax under this paragraph with respect to any household shall not exceed—
(i)200 gallons per calendar year if there are 2 or more adults in such household, or
(ii)100 gallons per calendar year if there is only 1 adult in such household.
(C)Adults
For purposes of this paragraph, the term “adult” means an individual who has attained 18 years of age, or the minimum age (if any) established by law applicable in the locality in which the household is situated at which wine may be sold to individuals, whichever is greater.
(3)Experimental wine
Subject to regulations prescribed by the Secretary, any scientific university, college of learning, or institution of scientific research may produce, receive, blend, treat, and store wine, without payment of tax, for experimental or research use but not for consumption (other than organoleptical tests) or sale, and may receive such wine spirits without payment of tax as may be necessary for such production.
(b)Cross references
(1)For provisions relating to exemption of tax on losses of wine (including losses by theft or authorized destruction), see section 5370.
(2)For provisions exempting from tax samples of wine, see section 5372.
(3)For provisions authorizing withdrawals of wine free of tax or without payment of tax, see section 5362.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 5042, act Aug. 16, 1954, ch. 736, 68A Stat. 610, consisted of provisions similar to those comprising this section, prior to the general revision of this chapter by Pub. L. 85–859.

Amendments

1978—Subsec. (a)(2). Pub. L. 95–458 substituted in heading “Wine for personal or family use” for “Family wine” and in text provision permitting an adult to produce 200 gallons of wine per calendar year if there are 2 or more adults in the household or 100 gallons of wine per calendar year if there is one adult in the household for provision which permitted the duly registered head of any family to produce an amount of wine not exceeding 200 gallons of wine per annum. 1976—Subsec. (a)(1) to (3). Pub. L. 94–455 struck out “or his delegate” after “Secretary” wherever appearing.

Statutory Notes and Related Subsidiaries

Effective Date

of 1978 Amendment Pub. L. 95–458, § 2(c), Oct. 14, 1978, 92 Stat. 1257, provided that: “The

Amendments

made by this section [amending this section and section 5051, 5053, 5054, 5092, 5222, and 5674 of this title] shall take effect on the first day of the first calendar month which begins more than 90 days after the date of the enactment of this Act [Oct. 14, 1978].”

Reference

Citations & Metadata

Citation

26 U.S.C. § 5042

Title 26, Internal Revenue Code

Last Updated

Sep 22, 2026

Release point: 119-110