[Code of Federal Regulations]
[Title 27, Volume 1]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR20.71]

[Page 442-443]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
 CHAPTER I--BUREAU OF ALCOHOL, TOBACCO AND FIREARMS, DEPARTMENT OF THE 
                                TREASURY
 
PART 20--DISTRIBUTION AND USE OF DENATURED ALCOHOL AND RUM--Table of Contents
 
                 Subpart E--Bonds and Consents of Surety
 
Sec. 20.71  Bond.


    (a) Except as provided in paragraph (d) of this section, each 
permittee who intends to withdraw more than 5000 gallons of specially 
denatured spirits per annum shall file a bond, Form 5150.25, before 
issuance of the permit. The penal sum of the bond shall be as follows:

------------------------------------------------------------------------
        Maximum annual withdrawals                 Bond penal sum
------------------------------------------------------------------------
0 to 5,000 gallons........................  No bond required.
Over 5,000 but not over 500,000 gallons...  $2,000 plus $1,000 for each
                                             5,000 gallons of
                                             withdrawals over 10,000
                                             gallons.
Over 500,000 gallons......................  $100,000.
------------------------------------------------------------------------

    (b) The following method may be used to compute your penal sum:
    (1) If the total of your estimated annual withdrawals is divisible 
by 5,000, divide it by 5. The result is your penal sum in dollars.
    (2) If the total of your estimated annual withdrawals is not 
divisible by 5,000, increase it to the next highest number which is 
divisible by 5,000 and divide that number by 5. The result is your penal 
sum in dollars.
    (c) The following are some examples:

------------------------------------------------------------------------
                                                                  Your
                If your annual withdrawals are                 penal sum
                                                                   is
------------------------------------------------------------------------
25,000 gallons...............................................     $5,000
84,500 gallons...............................................     17,000
335,000 gallons..............................................     67,000
------------------------------------------------------------------------

    (d) Any bond previously approved on Form 1475 or 1480 which fulfills 
the penal sum requirements of paragraph (b) of this section shall remain 
valid and will be regulated by the same provisions of this subpart as it 
refers to bonds on ATF F 5150.25. No bond is required if the permittee 
is a State, any

[[Page 443]]

political subdivision of a State, or the District of Columbia.

[T.D. ATF-199, 50 FR 9162, Mar. 6, 1985, as amended by 50 FR 20099, May 
14, 1985]