PRIA Logo™
Title 26 — Internal Revenue CodeRelease 119-73not60

§5042 Exemption From Tax

Title 26 › Subtitle 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 Apr 5, 2026|Official source

Summary

Cider that is made only from apple juice, ferments naturally, is not fizzy, is made outside a bonded wine cellar, and is sold as cider (not as wine or a wine substitute) is not taxed as wine. Under rules the Secretary sets, any adult may make wine at home for personal or family use without paying tax, as long as it is not sold. A household with two or more adults may make up to 200 gallons a year; a one-adult household may make up to 100 gallons a year. “Adult” means someone at least 18 years old or the local legal wine‑purchase age, whichever is higher. Under the Secretary’s rules, colleges and scientific research institutions may make, mix, store, and use wine tax‑free for experiments or research, but not for drinking except for taste tests; they may also receive wine spirits tax‑free if needed. Rules about tax-free losses of wine, samples, and tax-free withdrawals are in sections 5370, 5372, and 5362.

Full Legal Text

Title 26, §5042

Internal Revenue Code — Source: USLM XML via OLRC

(a)(1)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)Subject to regulations prescribed by the Secretary—
(A)Any adult may, without payment of tax, produce wine for personal or family use and not for sale.
(B)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)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)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)(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

Apr 5, 2026

Release point: 119-73not60