What the Court Ruling Against the Federal Home-Distilling Ban Means for Texas Distillers
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On April 10, 2026, the U.S. Court of Appeals for the Fifth Circuit, which covers Texas, held that the federal ban on distilling spirits at home exceeds Congress’s power and affirmed an injunction barring its enforcement against the plaintiffs in that case. Eleven days later the Sixth Circuit upheld the same federal law, and as of September 26, 2026, the question is pending before the U.S. Supreme Court. The ruling does not change Texas law. The Alcoholic Beverage Code still requires a permit to distill liquor, and its home-production allowance covers only wine and beer, so home distilling has no authorization under state law, and licensed Texas distilleries operate under the same permits and rules as before.
What the Fifth Circuit decided
In McNutt v. U.S. Department of Justice, No. 24-10760, the plaintiffs were the Hobby Distillers Association and several of its members who want to distill spirits at home. They challenged two federal tax provisions:
- 26 U.S.C. Section 5178(a)(1)(B), which bars locating a distilled spirits plant in a dwelling house or in a shed, yard, or enclosure connected with one; and
- 26 U.S.C. Section 5601(a)(6), which makes a violation punishable by a fine of up to $10,000, up to five years in prison, or both.
The court held that these provisions violate the Constitution’s Taxation and Necessary and Proper clauses. It found that all the plaintiffs had standing and affirmed, as modified, the district court’s judgment and its injunction against enforcing the provisions against them. The decision did not repeal the statute.
A split between circuits, now at the Supreme Court
In Ream v. U.S. Department of the Treasury, No. 25-3259, decided April 21, 2026, the Sixth Circuit reached the opposite result, concluding that the ban “was lawful when enacted, and remains so today.” One judge dissented on standing grounds.
The Supreme Court docket in Ream, No. 26-93, shows:
| Date | Event |
|---|---|
| July 20, 2026 | Ream files a petition for a writ of certiorari |
| August 14, 2026 | the federal government responds, agreeing that the question warrants review and stating that it is filing its own petition in McNutt, which it calls the better vehicle |
| September 23, 2026 | the Ream petition is distributed for the Court's conference of October 9, 2026 |
As of September 26, 2026, the Court had not decided whether to hear either case.
What does not change under Texas law
The federal case is about federal tax statutes. Texas has its own rules:
- A permit is required to distill. Under Section 11.01 of the Alcoholic Beverage Code, no person may manufacture or distill liquor in a wet area without first obtaining the required permit, and a person may distill only where the Code grants that privilege.
- Home production is limited to wine and beer. Section 109.21 lets the head of a family or an unmarried adult produce up to 200 gallons of wine or malt beverages a year for personal or family use without a license or permit, and it does not protect beverages that are distilled, fortified, or otherwise altered to increase their alcohol content.
Because the Code grants no privilege to distill spirits at home, a Texan who does so without a state permit is acting without authorization under Texas law, however the federal question is resolved.
What it means for licensed Texas distilleries
For a business that holds a TABC distiller’s permit, nothing in McNutt alters its permit, its on-site sales privileges, or its compliance obligations; the case concerned federal restrictions on distilling at home. The practical points are narrower:
- Watch the Supreme Court’s action on the pending petitions, since a decision could reshape the federal rule nationwide.
- Treat any change in Texas as a matter for the Legislature, because the state permit requirement stands apart from the federal ban.
- Answer customer questions about home distilling accurately: a federal court ruling in favor of particular plaintiffs does not create a right to distill at home under Texas law.
This article is general information about Texas alcoholic beverage law, not legal advice, and reading it does not create an attorney-client relationship. Statutes and TABC rules change; confirm current requirements with the Texas Alcoholic Beverage Commission, the relevant city or county, or a licensed Texas attorney before acting.