Alcohol Tax Bond

Alcohol / Liquor Bond Definition

When you start your liquor business, you’ll be required to obtain an alcohol tax bond by the state or federal government. It is a prerequisite for participating in the sale, manufacturing and warehousing of alcohol. So what exactly is the alcohol bond?

The alcohol bond, also known as a liquor bond, is a type of tax bond that guarantees the payment of taxes on all transactions with liquor. Thus it protects the authority requiring it, in case you are unable to pay collected taxes or you keep fraudulent records.

In practical terms, it is a three-party contract between your liquor business as the principal, the state or federal government as the obligee, and the surety as the underwriter of the bond.

Unlike other surety bonds, the alcohol tax bond acts as a financial guarantee, which is a type of bond often avoided by sureties. The reason is that financial guarantee bonds involve a higher level of risk, since they entail financial reimbursement rather than full performance of services or abiding by certain laws and regulations. However, in the case of a liquor bond, the state is the obligee and taxes are usually collected and stored separately, which reduces the risk of fraud.

In case you still transgress the rules of tax collection on liquor, a claim can be made on your bond. If a discrepancy is proven, the surety will cover the expenses up to the penal sum of the bond. Afterwards you will need to fully reimburse the underwriter, however. It makes sense to collect and pay your liquor taxes diligently, as bond claims can be of great financial and reputational harm to your business.

You can apply for your liquor bond from the table below or continue reading the sections that follow for more information.

Liquor Bond Cost

The cost of your alcohol tax bond will largely depend on the state or government authority requiring the guarantee. The bonding amounts may be somewhere between $2,500 and $7,500, but in some cases they may differ, as they are set by the relevant obligee.

As with other types of bonding, you’ll have to pay only a percentage of the required bonding amount. Thus, if you qualify for the standard market, you’re likely to pay a premium between 1% and 5%.

You can’t control the required bonding amount, but there are ways to lower the percentage you’ll have to pay from it. One of the most important factors that sureties consider when they examine your application is your credit score. That’s why it’s a good idea to try to improve your financial profile. Showing proof of your liquidity and assets is another way to present your business in the best light and get a lower bond premium.

It’s also important to carefully choose your surety underwriter. Bryant Surety Bonds works with multiple A-rated, T-listed surety companies, which allows us to shop around for the best bonding rate for your specific situation.

To get an estimate of your bond cost, you can use our surety bond cost calculator in the right sidebar or consult our surety bond cost page to see how the bond premium is calculated.

Bad Credit Program

If you have a lower credit score, tax liens, bankruptcies or civil judgments, you might have a harder time to get your liquor bond. Still, there are options to get bonded.

Our bad credit surety bond program is a really good one. We strive to give you the opportunity to get your alcohol tax bond and stay in business even if your financial situation is not so perfect. Getting bonded with bad credit means you’ll have to pay a bit more for your bond premium - in the range of 5%-17%. This is needed to compensate for the higher risk involved in the underwriting. However, our bonding experts will examine your specific situation and will offer you the best solution for your case.

Get Your Alcohol Bond Today

It’s easy to start your bonding process today. You can apply online to get a free, no-obligation quote in minutes. If you need more information, don’t hesitate to call us at 866.450.3412. You can get help and receive answers by our bonding experts, so that getting bonded involves no hassle for you.

Popular Liquor/Alcohol Tax Bonds by State

Alcohol Tax (Retailers)

Department of the Treasury

• Bond: Brewers Bond
• Obligee: Department of the Treasury: Alcohol and Tobacco Tax and Trade Bureau (TTB)
• Form: OMB 1513-0015
• Amount: Set by Obligee

Georgia

• Bond: Retailers and Consumption on Premises Liquor License Performance and Tax Liability Bond
• Obligee:Georgia Department of Revenue: Alcohol and Tobacco DivisionPO Box 49512 Atlanta, GA 30359-1512
• Form: ATT-59 (BOND FORM REQUIRES A 12/31 EXPIRATION DATE)
• Amount: $2,500

Iowa

• Bond: Beer Permit Bond, Wine Permit Bond
• Obligee:Department of Commerce: Alcoholic Beverages Division1918 S.E. Hulsizer Ankeny, Iowa 50021
• Form:
• Amount: $5,000

Kansas

• Bond: Kansas Liquor Drink Tax Surety Bond
• Obligee:Kansas Department of Revenue: Customer Relations – Miscellaneous Segment915 SW Harrison St. Topeka, Kansas 66625-5000
• Form: LD-400
• Amount: Set by Obligee

Mississippi

• Bond: Surety Bond (generic form)
• Obligee: State of Mississippi Department of Revenue: Alcoholic Beverage Control
• Form:
• Amount: Set by Obligee

New Jersey

• Bond: New Jersey Beverage Tax Bond
• Obligee:NJ Department of the Treasury, Division of Taxation: Beverage Tax License UnitCN-252 Trenton, New Jersey 08646
• Form: B-7-1800
• Amount: Set by Obligee

Texas

• Bond: Texas Continuous Bond-Mixed Beverage Gross Receipts Tax
• Obligee:Texas Comptroller of Public AccountsAustin, Texas
• Form: 67-102 (BOND FORM REQUIRES A 12/31 EXPIRATION DATE)
• Amount: Set by Obligee

Utah

• Bond: Limited Restaurant Bond
• Obligee:Utah Department of Alcoholic Beverage Control1625 s 900 W PO Box 30408 Salt Lake City, UT 84130-0408
• Form:
• Amount: $5,000

About us:

Bryant Surety Bonds

Bryant Surety Bonds, Inc. is a surety bond agency based in Pennsylvania. Licensed in all 50 states and with access to over 20 T-listed, A-Rated bonding companies, we have the contacts, expertise, and top service to provide you with a hassle-free experience, all while offering competitive rates for your surety bond.