Manufacturers of tobacco products, export warehouse proprietors and manufacturers of cigarette papers and tubes are required to have surety bond before they can operate a business.
The Obligee (the TTB) is the entity that requires the bond or collateral in order to make or export tobacco products. The bond ensures the principal (you, the applicant) will comply with federal laws and provide payment of any tax liabilities due to the US Department of Treasury. Failure to comply or perform in the manor prescribed by the TTB may result in a claim to be filed against the bond or financial security. In the instance of a surety bond, if the TTB files a claim against the surety bond, the tobacco manufacturer or exporter (named as the principal on the bond form) will be responsible for repayment of the claimed amount to the surety if the claim is paid out.
The surety bond or collateral must be in place from the time of the initial permit and long as the business remains in operation. The surety bond premium will renew on the bond on an annual basis. Failure to pay the renewal premium annually will result in the termination of the bond.
A surety bond is required based on the TTB’s requirements. The bond amount is determined by the type of business operation and the estimated tax liability amount.
If providing collateral instead of a surety bond, the collateral will be in an amount equal to the surety bond.
The premium that you pay for a TTB Tobacco Surety Bond is dependent on credit and the amount of tax liability. For bond amounts over $50,000, personal and business financial statements will be required. Our rates start at 1% of the bond amount with good credit.
You must mail the original surety bond and a duplicate original signed copy to: TTB National Revenue Center, 550 Main Street, Suite 8002, Cincinnati, OH 45202-5215.
Check out our FAQ page or What’s a Surety Bond? page. Should you need or choose to buy a surety bond, buy from us. SuretyGroup.com has been underwriting surety bonds throughout the U.S. for more than 35 years. When you work with us, you enjoy the unique benefit of dealing with a team of highly experienced surety agents with in-house underwriting authority. This allows you to receive competitive, low rates, quick approvals, and immediate bond delivery. In most cases, your bond will be delivered within 24 hours after you apply for it.
For a downloadable application