I 

111TH CONGRESS 

2D SESSION H. R. 5490 

To amend the Internal Revenue Code of 1986 to allow a credit against 

excise taxes with respect to distilled spirits and wine for certain distilled 

spirits or wine produced from domestic agricultural waste or byproducts. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 9, 2010 

Ms. GINNY BROWN-WAITE of Florida introduced the following bill; which was 

referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to allow a 

credit against excise taxes with respect to distilled spirits 

and wine for certain distilled spirits or wine produced 

from domestic agricultural waste or byproducts. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. EXCISE TAX CREDIT FOR CERTAIN DISTILLED 

4 SPIRITS PRODUCED FROM DOMESTIC AGRI5 CULTURAL WASTE OR BYPRODUCTS. 

6 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

7 Internal Revenue Code of 1986 is amended by adding at 

8 the end the following new section: 


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1 ‘‘SEC. 6433. CREDIT FOR CERTAIN DISTILLED SPIRITS PRO2 DUCED FROM AGRICULTURAL WASTE OR BY3 PRODUCTS. 

4 ‘‘(a) IN GENERAL.—There shall be allowed against 

5 the taxes imposed by chapter 51 an amount equal to the 

6 sum of the credits determined under subsections (b) and 

7 (c). 

8 ‘‘(b) CREDIT FOR DISTILLED SPIRITS PRODUCED

9 FROM DOMESTIC AGRICULTURAL WASTE OR BYPROD10 UCTS.— 

11 ‘‘(1) IN GENERAL.—For purposes of this sec12 tion, the credit determined under this subsection is 

13 an amount equal to the product of— 

14 ‘‘(A) 10 percent of the rate in effect under 

15 section 5001(a), multiplied by 

16 ‘‘(B) the number of proof gallons of rum 

17 produced in the United States by the taxpayer 

18 using domestic agricultural waste or domestic 

19 agricultural byproducts as the principal dis20 tilling source. 

21 ‘‘(2) RUM.—For purposes of this subsection, 

22 the term ‘rum’ has the meaning given such term by 

23 section 7652(e)(3). 

24 ‘‘(3) CREDIT AVAILABLE TO PRODUCER.—The 

25 credit determined under this subsection shall be al26 lowed only to the producer of the rum described in 


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1 paragraph (1)(B), without regard to whether the tax 

2 on such rum under section 5001(a) is paid by such 

3 producer or by any other person. 

4 ‘‘(4) VALUE ADDED REQUIREMENT.—Any proof 

5 gallon of rum shall in no event be treated as pro6 duced in the United States for purposes of this sub7 section unless the sum of— 

8 ‘‘(A) the cost or value of the rum produced 

9 in the United States, plus 

10 ‘‘(B) the direct costs of processing oper11 ations performed in the United States, 

12 equals or exceeds 50 percent of the value of such 

13 rum as of the time of its sale at retail (determined 

14 without regard to the tax imposed by section 5001). 

15 ‘‘(c) CREDIT FOR CERTAIN DISTILLED SPIRITS OR

16 WINE PRODUCED FROM DOMESTIC CITRUS WASTE OR

17 BYPRODUCTS.— 

18 ‘‘(1) IN GENERAL.—For purposes of this sec19 tion, the credit determined under this subsection is 

20 an amount equal to the product of— 

21 ‘‘(A) the number of gallons of distilled 

22 spirits or wines which are produced in the 

23 United States by the taxpayer using domestic 

24 citrus waste or domestic citrus byproducts as 


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1 the principal distilling or fermenting source, 

2 multiplied by 

3 ‘‘(B) 10 percent of the rate applicable to 

4 such distilled spirits or wine under section 

5 5041(b). 

6 ‘‘(2) COORDINATION WITH CREDIT FOR SMALL

7 DOMESTIC PRODUCERS.—In the case of any wine to 

8 which paragraph (1)(A) and section 5041(c) both 

9 apply, the amount of the credit otherwise allowed 

10 under section 5041(c) with respect to such wine 

11 shall be reduced by the amount of the credit under 

12 this subsection. 

13 ‘‘(3) CREDIT AVAILABLE TO PRODUCER.—The 

14 credit determined under this subsection shall be al15 lowed only to the producer of the distilled spirits or 

16 wines described in paragraph (1)(A), without regard 

17 to whether the tax on such distilled spirits or wines 

18 under section 5041(a) is paid by such producer or 

19 by any other person. 

20 ‘‘(4) VALUE ADDED REQUIREMENT.—Any gal21 lon of distilled spirits or wines shall in no event be 

22 treated as produced in the United States for pur23 poses of this subsection unless the sum of— 

24 ‘‘(A) the cost or value of the distilled spir25 its or wines produced in the United States, plus 


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1 ‘‘(B) the direct costs of processing oper2 ations performed in the United States, 

3 equals or exceeds 50 percent of the value of such 

4 distilled spirits or wines as of the time of their sale 

5 at retail (determined without regard to the tax im6 posed by section 5041).’’. 

7 (b) CLERICAL AMENDMENT.—The table of sections 

8 for subchapter B of chapter 65 of the Internal Revenue 

9 Code of 1986 is amended by adding at the end the fol10 lowing new item: 

‘‘Sec. 6433. Credit for certain distilled spirits produced from agricultural waste 

or byproducts.’’. 

11 (c) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to distilled spirits and wine pro13 duced after the date of the enactment of this Act. 

Æ 


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