The Alcohol and Tobacco Tax and Trade (TTB) application is one of the most daunting challenges to opening a brewery. It’s exceedingly thorough and comes before any of the other state or local applications. The approval process often takes more than 4 months.
Thanks in large part to the help of other brewers who were willing to share their experience, we were lucky to have our application approved in 22 days. In the spirit of those who shared with us, we’d like to offer a few tips to help other new brewers navigate this challenging process.
One of the most tedious parts of the TTB application is the “Sources of Funds” documentation, where you must account for every cent of startup capital. If anyone who has contributed money is not an owner, the TTB requires a letter from that person stating that they have no ownership interest in the company.
This really freaked us out–we were dreading the logistical nightmare of getting individual letters from our 150+ Kickstarter backers.* We wrote Kickstarter and asked if they could provide us one letter explicitly stating that no ownership transfer was tied to the deposit we received from Kickstarter.** Kickstarter did, and the TTB accepted their letter.
Open a bank account ASAP
If your brewery does not have an established bank account with 6 months of records, each owner will have to supply, at a minimum, 5 months of personal financial records. Being able to simply send brewery financial statements streamlined the process and made it a lot less personally intrusive.
Answer every question
There will be some questions seemingly intended for big breweries (power generation, waste water, etc.). Answer them anyway. For the power generation question we put something simple, along the lines of: “All power will be purchased from our local power utility and delivered through the existing power grid.”
Err on the side of too much detail
With the TTB, “more” seems to be “more.” We described the building in extensive detail, including every aspect of the brewery’s construction, down to drywall thickness. Make sure your floor plan shows where every single part of the brewery will be located–including windows, sinks, and floor drains.
Finally, be prepared for everything to go well! We have no idea how the process will go for you, but make a contingency plan in case the process goes faster than expected. We tied our project schedule to a longer approval process; as it turned out, we could have significantly shortened our timeline.
*Can we say thank you, again? Yes. Thank you, again.
**Kickstarter actually has a policy that states “project creators keep 100% ownership of their work, and Kickstarter cannot be used to offer equity, financial returns, or to solicit loans.” We quoted this back to them when we asked for a letter!