May 1st, 2012
By Sarah Werner - ShipCompliant Research Team
Spring brings more than flowers this year for supporters of direct shipping. After three and a half months of anticipation and preparation, the New Jersey Division of Alcoholic Beverage Control posted checklists, forms and applications on their site, making S 3172 a reality for the wine industry. Effective May 1, New Jersey is accepting applications for the Out-of-State Winery License from wineries producing less than 250,000 gallons (roughly 105,000 cases) annually. Annual production dictates the fee for the new license:
- Less than 1,000 gallons – $63
- Between 1,000 and 2,500 gallons – $125
- Between 2,500 and 30,000 gallons – $250
- Between 30,000 and 50,000 gallons – $375
- Between 50,000 and 250,0000 gallons – $938
In an unanticipated twist, corporate laws in New Jersey require any foreign (non-New Jersey) corporation that secures a license from a state agency (for example, a wine shipper’s license from the NJ ABC) to establish nexus with the state. With this nexus, out-of-state winery licensees must also annually file corporate income tax and pay a minimum of $500/year, depending on gross revenues. Partnerships are also subject to a tax of $150/partner/year and annual filing. All wineries applying for the license should be aware that they are subject to this requirement.
On top of direct shipping capabilities for Out-of-State Wineries, with the payment of an additional fee (from $100 to $1000 depending on annual production), licensees may ship directly to New Jersey retailers. Common carriers are not allowed to ship these orders to retailers, and price posting is required on products for sale to retailers. Additionally, licensees have the option to open up to 16 tasting rooms within New Jersey for a fee of $250/site.
Here are the forms referenced in New Jersey’s checklist and instructions, in order of appearance:
- Register for taxes
- Obtain a Beverage Tax Bond
- Complete the Out-of-State Winery License Application
- For each label, complete the Brand Registration Application (Instructions)
- Bi-monthly, file the Alcoholic Beverage Tax Return with Supplemental Schedule