Tax regulation of certain laboratory alcohols

Specially Denatured Spirits

Specially Denatured Spirits (SDS) is alcohol or rum which  has been treated with denaturants to make it unfit for beverage use. SDS  includes Specially Denatured Alcohol (SDA) and Specially Denatured Rum (SDR).  An Industrial Alcohol User Permit is needed to procure, use, recover and/or  deal in SDS.

Users and Recoverers of Specially Denatured Spirits

A user purchases SDS to use in a process or in the manufacture  of a substance, preparation, or product. SDS has many uses, such as:

  • In laboratories as a solvent, for cleansing purposes, or in the preparation of indicator solutions and reagents.
  • In the manufacture of such articles as perfumes, proprietary solvents, tobacco flavors, lotions and sprays.
  • In conversion processes to produce other substances, such as vinegar or ethyl acetate.

A recoverer reclaims or salvages SDS or articles (substances  or preparations containing SDS) during or after the manufacturing process. The recovered SDS may be used again as is (if still sufficiently denatured) or it  may be reconditioned.

All users and recoverers of SDS must obtain an Industrial  Alcohol User Permit.

If you use only small amounts of a SDS formula for laboratory  purposes, consider using reagent alcohol instead of SDS. Reagent alcohol is an  ethyl alcohol denatured with approximately 5 percent methyl alcohol and further  denatured with 5 parts per hundred of isopropyl alcohol. It can be obtained from  most laboratory supply houses and may be obtained without a permit.

If you obtain reagent alcohol in containers exceeding 4  liters, a letterhead application must be filed with the federal Alcohol Tobacco  Tax and Trade Bureau of the U.S. Department of Treasury.


TTB P 5150.3 — Information for Specially Denatured Spirits Applications
TTB P 5150.4 — Information for Tax-Free Alcohol Applicants
Alcohol and Tobacco Tax and Trade Bureau web page.