The demand for no- and low-alcohol beverages has exploded in recent years. From health-conscious consumers seeking moderation to younger demographics embracing mindful drinking, wineries are increasingly exploring how dealcoholized or reduced-alcohol products might fit into their portfolios. While the trend is promising, the regulatory framework in the United States can be surprisingly complex.
If your winery is considering producing or importing no- or low-alcohol wines, here are the key regulatory points to understand.
TTB Oversight and the “Dealcoholized Wine” Category
The Alcohol and Tobacco Tax and Trade Bureau (“TTB”) regulates wine that contains 0.5% alcohol by volume (“ABV”) or more. Dealcoholized wine is typically produced by fermenting a wine to completion and then removing most of the alcohol through processes such as vacuum distillation or reverse osmosis.
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If the finished wine product contains 0.5% ABV or higher, it is still regulated by TTB and production must be done so on a bonded winery premises (i.e., at a TTB permitted winery).
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If the finished wine product contains less than 0.5% ABV, it is no longer under TTB’s jurisdiction as far as permitting is concerned. Instead, the U.S. Food and Drug Administration (“FDA”) will regulate the product as a conventional food product. Note that certain dealcoholized wine products may still trigger a type of TTB permit depending on the process used to remove alcohol, even if the final product is under 0.5% ABV.
This threshold distinction is critical: even if you start with wine, the finished dealcoholized version may not be considered “wine” under federal law.
Labeling Requirements
In the U.S., labeling requirements for wine depend not just on whether the product is dealcoholized, but also on its alcohol content:
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TTB Jurisdiction (≥7% ABV): Wines at or above 7% ABV fall under the TTB’s labeling jurisdiction. These products require a Certificate of Label Approval (“COLA”) before they can be sold in interstate commerce. TTB labeling rules mandate information such as brand name, class/type designation, alcohol content, net contents, health warning statement, bottler/importer information, and sulfite declaration (when applicable).
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FDA Jurisdiction (<7% ABV): Wines containing less than 7% ABV are regulated by the FDA for labeling purposes. FDA does not require COLAs, but it does require compliance with food labeling regulations. See generally 21 CFR Part 101. This means a label must typically include a nutrition facts panel, standard of identity, ingredient statement, allergen disclosure (if applicable), net contents, and name/place of business. These rules differ significantly from TTB’s framework and may require wineries to redesign labels when producing low-ABV wines.
Importantly, terms such as “alcohol-free” and “non-alcoholic” have specific regulatory meanings. “Alcohol-free” can only be used if a product contains 0.0% ABV (i.e., no detectable alcohol). A wine with less than 0.5% ABV but not entirely free of alcohol should instead use “alcohol-removed” or “dealcoholized.”
This jurisdictional split often surprises wineries: a product marketed as “low-alcohol wine” at 6.9% ABV will have FDA food-style labeling requirements, while the same product at 7.1% ABV is fully under TTB’s wine regulations. Stay alert and informed if your company is considering producing a lower alcohol wine.
Distribution and State-Level Nuances
Even if a product contains less than 0.5% ABV, state laws may still treat dealcoholized wine differently. Some states allow direct-to-consumer shipping of non-alcoholic beverages with fewer restrictions, while others classify anything derived from wine under alcohol control boards.
Because of these discrepancies, wineries should carefully research how each state defines and regulates dealcoholized products before expanding distribution.
Federal Tax Implications
Federal excise taxes apply only to wine products that contain 0.5% ABV or more. Wines below this threshold are not subject to the federal excise tax, but state and local taxes may still apply depending on applicable laws. Wineries should also consider sales tax implications.
Practical Takeaways for Wineries
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Know your product’s ABV. The 0.5% line determines whether or not the product must be produced on TTB bonded winery premises.
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Plan labels early. If under FDA, be prepared to add full nutrition and ingredient statements.
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Check state rules. Direct-to-consumer shipping and retail sales rules vary widely for non-alcoholic wines.
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Market carefully. Avoid health claims that could trigger regulatory scrutiny.
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Seek guidance. The overlap of federal and state rules makes compliance more complex than it first appears.
If your winery is considering no- or low-alcohol products, contact us at info@zahnlawpc.com. Our firm can guide wineries and alcohol beverage businesses through the evolving regulatory landscape, including dealcoholized and low-alcohol products. From determining whether your product falls under TTB or FDA oversight, to label review, distribution compliance, and state-by-state analysis, we help ensure your launch is both successful and compliant.
For questions related to alcohol beverage law, food labeling, regulatory compliance, or related matters, please contact Lindsey Zahn at Lindsey Zahn P.C. to learn more about how we can assist your business.
DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.
