Rules & Regulations of the State of Tennessee
Title 1320 - Revenue
Subtitle 1320-04 - Miscellaneous Tax Division
Chapter 1320-04-02 - Sales of Alcoholic Beverages for Consumption on the Premises
Section 1320-04-02-.04 - RESTRICTIONS ON DISPOSITION OF ALCOHOLIC BEVERAGE

Universal Citation: TN Comp Rules and Regs 1320-04-02-.04

Current through September 24, 2024

(1) A licensee shall not make any disposition of liquor except through sales by the drink for consumption on the premises and shall not make any disposition of wine except through sales for consumption on the premises.

(2) A licensee may be permitted to reduce his inventory by the amount of any alcoholic beverages lost due to theft, breakage or acts of nature only if proper proof of loss is supplied the department as follows:

(a) As soon as practicable after a loss of alcoholic beverages due to the theft occurs, provide the Department with proof that the theft was reported to the proper law enforcement agency and that the insurer who has insured the goods has paid the claim for their loss. A certificate from the department will be provided the licensee upon receipt of the required proof. A copy of said department certification shall be retained by the licensee for a period of three years as evidence of proper authorization for such inventory reduction.

(b) As soon as practicable after a loss of alcoholic beverages due to breakage or acts of nature occurs, obtain the assistance of, a department agent to observe the loss and furnish a certificate stating the quantity and brand of the liquor on which the identification stamp remains identifiable with the federal strip stamp intact, and with reference to wine, the agent must be able to determine the quantity and brand of wine on which the crown, cap, seal, or cork remain intact and unbroken. In instances where containers are not broken but the beverage is declared unsalable by the Pure Food and Drug Administration or other appropriate authority the licensee may be allowed inventory reduction if the products are destroyed by or in the presence of a department agent and so certified. A copy of said certificate shall be retained by the licensee as evidence of proper authorization for a period of three years for such inventory reduction.

(3) Wine or distilled spirits to be used and consumed in the preparation of food shall be stored separately from those alcoholic beverages sold by the drink for consumption on the premises. The wine or distilled spirits shall be used and consumed exclusively in the preparation of food. If any portion of the contents of a bottle of wine or distilled spirits is sold by the drink for consumption on the premises, the licensee shall be liable for liquor-by-the-drink tax on the total disposition, as if the entire contents of the bottle had been sold by the drink.

Authority: T.C.A. §§ 67-1-102 and 57-4-302.

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