Tobacco Tax Bond Guide
Secure | No Obligation | Takes 2 Minutes
What Are Cigarette & Tobacco Tax Bonds?
Cigarette and tobacco tax bonds are financial guarantees that ensure payment of federal and state sales taxes owed on tobacco products. This bond is often required to obtain licensing to sell, manufacture, distribute, import or warehouse cigarettes and tobacco-related products.
Federal Tobacco Tax Bonds
The Alcohol and Tobacco Tax and Trade Bureau (TTB) requires a TTB tobacco bond for export warehouses and manufacturers of tobacco products, cigarette tubes and papers. Under this bond, a tobacco business is legally bound to pay all federal tobacco taxes, including penalties and interest.
State Tobacco Tax Bonds
Many states and local governments also require a tobacco tax bond for local cigarette and tobacco distributors, retailers and manufacturers. This guarantees payment of local taxes on tobacco products. Some producers may need a federal TTB bond as well as a local tobacco bond.
How Much Do Cigarette & Tobacco Tax Bonds Cost?
The cost of cigarette and tobacco tax bonds varies by state and bond amount. Some bonds are available at a flat rate while others require underwriting review. You can expect to pay a small percentage of the bond amount — typically 1–5%.
If you need a federal cigarette tax bond, visit our TTB tobacco bond page for a free quote. If you need a local bond, select your state below:
How Do Cigarette & Tobacco Tax Bonds Work?
A cigarette and tobacco tax bond binds three parties in a legal contract:
- Principal: The individual or business purchasing the bond
- Surety: The provider issuing the bond to the principal
- Obligee: The state or local government requiring the bond
If a bonded individual or merchant does not fulfill their sales tax obligations, the government can file a claim to recover damages.
Who Needs a Tobacco Tax Bond?
Any business that collects sales or excise taxes on cigarettes and other tobacco products may need a surety bond. This bond can apply to distributors, manufacturers, wholesalers, importers, and retailers of tobacco products.
How to Get a Cigarette & Tobacco Tax Bond
SuretyBonds.com provides the fastest and easiest way to get a cigarette and tobacco tax bond. Just follow these four steps:
- Apply online at SuretyBonds.com
- Get a free quote within one business day
- Purchase your bond
- File the bond with your obligee
If your bond is available for instant issue, you can purchase your bond now and receive a digital copy of your bond within minutes.
How Do I Renew My Cigarette Tax Bond?
Most cigarette and tobacco tax bonds expire annually. A SuretyBonds.com representative will contact you with renewal instructions and an invoice to keep your bond active before your term ends.
How Do I Update My Tobacco Tax Bond Form?
If you need to update any information on your bond form, call 1 (800) 308-4358 or email [email protected]. One of our friendly representatives will be happy to assist you.
Have Questions?
Call 1 (800) 308-4358 to talk with a Surety Expert today.
