Hospitality Industry Alert: Important Information on May 2009 Alcoholic Beverages Tax
6/22/2009
It has come to our attention that the New York State Tax Department is in the process of informing distributors of wines and beer not to file the Form MT-40, Return of Tax on Wines, Liquors, Alcohol, and Distilled or Rectified Spirits, or Form MT-50, Beer Tax Return, with a (3/06) revision date for May 2009, due June 22, 2009. The department inadvertently sent the incorrect (3/06) version of these forms with the incorrect tax rates. The Tax Department is sending distributors of wines and beer the corrected (5/09) version of Forms MT-40 and MT-50. Forms MT-40 and MT-50 are also available on the Tax Department Web site (www.tax.state.ny.us).
As mentioned in our last hospitality industry tax alert, New York State increased the excise tax rate on wine from $0.1893 to $0.30 per gallon and the excise tax rate on beer from $0.11 to $0.14 per gallon, effective May 1, 2009. As a part of this amended law, the State is imposing a one-time floor tax on beer and wine held in inventory in order to ensure current inventories are subject to the increased tax rate. An in-depth explanation by the State regarding the new rules, as well as the increased rates themselves, are in the attached document.
All restaurants, bars, and other sellers of beer and wine not registered as distributors were asked to take a physical inventory on May 1, 2009 prior to opening for business, file a floor tax return, and pay the increased tax on all beer and wine in their possession. The increased excise tax is based upon the liquid volume of the wine and beer inventories, not their value. Even businesses that did not have beer or wine in inventory on May 1st were still asked to file a floor tax return and indicate that no tax is due.
Instructions for Filing Amended Returns
If a distributor of wines or beer already filed Form MT-40 or MT-50 with a revision date of (3/06), an amended return will be needed.
Form MT-40 filers should recompute the tax on lines 1-15. On line 16, enter the amount paid with the (3/06) version that was previously filed, and compute the additional balance due on line 17. Lines 18-20 (the New York City excise tax) should remain unchanged. Check the box for "amended return" at the top of the form and send it with your additional payment to the address shown on the return.
Form MT-50 filers should recompute the tax on lines 1-18 under the New York State column. On line 19, enter the amount paid with the (3/06) version that was previously filed, and compute the additional balance due on line 20. The New York City column should remain unchanged. Check the box for "amended return" at the top of the form and send it with your additional payment to the address shown on the return.
In other, unrelated New York tax news, there is a forthcoming increase of 0.5% in the new York City portion of the sales tax. This will bring the New York city sales tax rate up to 8.875%. There may also be some lesser tax changes in the budget agreement that are forthcoming as well, which will we continue to keep you alerted on as they come to light.
To find out how these changes impact you, contact your J.H. Cohn service professional at 877-704-3500.
Circular 230 Notice: In compliance with U.S. Treasury Regulations, the information included herein (or in any attachment) is not intended or written to be used, for the purpose of i) avoiding penalties the IRS and others may impose on the taxpayer or ii) promoting, marketing or recommending to another party any tax related matters.