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Title 26, Internal Revenue CodeRelease 119-110

§5373 Wine Spirits

Title 26 › Subtitle E — Alcohol, Tobacco, and Certain Other Excise Taxes › CHAPTER 51 — DISTILLED SPIRITS, WINES, AND BEER › Subchapter F — Bonded and Taxpaid Wine Premises › PART II — OPERATIONS › § 5373

Last updated Sep 22, 2026|Official source

Summary

Allows only brandy or spirits made only from fruit, wine, wine leftovers, or special natural wine to be used in making wine. If sugar was added when making natural or special natural wine, that wine or its leftovers cannot be used if the unfermented sugars there have been refermented. These wine spirits must not be watered down right after distillation, and they generally must be distilled at not less than 140 degrees proof unless the Secretary’s rules say otherwise. One exception: commercial brandy aged in wood at least 2 years and barreled at not less than 100 degrees proof counts as wine spirits. The owner of a bonded wine cellar may withdraw wine spirits tax-free from a distilled spirits plant or another bonded wine cellar for making natural wine, for adding to juice, or for other allowed uses. If the spirits are not used for wine, they can be transferred back or taxed and removed. The Secretary credits the cellar owner for amounts used, transferred, taxpaid, and for allowable losses (see section 5008(a)). Samples may be withdrawn tax-free for testing. The Secretary may also allow aldehyde-containing distillates to move tax-free to an adjoining bonded wine cellar for fermentation and return as distilling material if it won’t harm revenue or administration.

Full Legal Text

Title 26, §5373

Internal Revenue Code, Source: USLM XML via OLRC

(a)In general
The wine spirits authorized to be used in wine production shall be brandy or wine spirits produced in a distilled spirits plant (with or without the use of water to facilitate extraction and distillation) exclusively from—
(1)fresh or dried fruit, or their residues,
(2)the wine or wine residues, therefrom, or
(3)special natural wine under such conditions as the Secretary may by regulations prescribe;
except that where, in the production of natural wine or special natural wine, sugar has been used, the wine or the residuum thereof may not be used if the unfermented sugars therein have been refermented. Such wine spirits shall not be reduced with water from distillation proof, nor be distilled, unless regulations otherwise provide, at less than 140 degrees of proof (except that commercial brandy aged in wood for a period of not less than 2 years, and barreled at not less than 100 degrees of proof, shall be deemed wine spirits for the purpose of this subsection).
(b)Withdrawal of wine spirits
(1)The proprietor of any bonded wine cellar may withdraw and receive wine spirits without payment of tax from the bonded premises of any distilled spirits plant, or from any bonded wine cellar as provided in paragraph (2), for use in the production of natural wine, for addition to concentrated or unconcentrated juice for use in wine production, or for such other uses as may be authorized in this subchapter.
(2)Wine spirits so withdrawn, and not used in wine production or as otherwise authorized in this subchapter, may, as provided by regulations prescribed by the Secretary, be transferred to the bonded premises of any distilled spirits plant or bonded wine cellar, or may be taxpaid and removed as provided by law.
(3)On such use, transfer, or taxpayment, the Secretary shall credit the proprietor with the amount of wine spirits so used or transferred or taxpaid and, in addition, with such portion of wine spirits so withdrawn as may have been lost either in transit or on the bonded wine cellar premises, to the extent allowable under section 5008(a). Where the proprietor has used wine spirits in actual wine production but in violation of the requirements of this subchapter, the Secretary shall also extend such credit to the wine spirits so used if the proprietor satisfactorily shows that such wine spirits were not knowingly used in violation of law.
(4)Suitable samples of brandy or wine spirits may, under regulations prescribed by the Secretary, be withdrawn free of tax from the bonded premises of any distilled spirits plant, bonded wine cellar, or authorized experimental premises, for analysis or testing.
(c)Distillates containing aldehydes
When the Secretary deems such removal and use will not jeopardize the revenue nor unduly increase administrative supervision, distillates containing aldehydes may, under such regulations as the Secretary may prescribe, be removed without payment of tax from the bonded premises of a distilled spirits plant to an adjacent bonded wine cellar and used therein in fermentation of wine to be used as distilling material at the distilled spirits plant from which such unfinished distilled spirits were removed.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 5373, act Aug. 16, 1954, ch. 736, 68A Stat. 667, consisted of provisions similar to those comprising this section, prior to the general revision of this chapter by Pub. L. 85–859.

Amendments

1976—Pub. L. 94–455 struck out “or his delegate” after “Secretary” wherever appearing. 1968—Subsec. (a). Pub. L. 90–619 inserted special natural wine, under conditions prescribed by

Regulations

, as one of the materials from which wine spirits may be produced and extended to special natural wines the existing prohibition on the use of natural wine whose sugars have been refermented.

Statutory Notes and Related Subsidiaries

Effective Date

of 1968 Amendment Pub. L. 90–619, § 6, Oct. 22, 1968, 82 Stat. 1237, provided that: “The

Amendments

made by this Act [amending this section and sections 5382 to 5387 of this title] shall take effect on the first day of the first month which begins 90 days or more after the date of the enactment of this Act [Oct. 22, 1968].”

Reference

Citations & Metadata

Citation

26 U.S.C. § 5373

Title 26, Internal Revenue Code

Last Updated

Sep 22, 2026

Release point: 119-110