We ain't lawyers, but we know this much for sure: It is illegal to distill moonshine and / or distill ethanol in certain states without a permit! If you're going to be distilling fuel alcohol, we recommend (and the government requires) that you fill out this form and get a permit: http://www.ttb.gov/forms/f511074.pdf
Also, each state has its own set of requirements for distilling fuel alcohol and most require a permit. Not sure about your state? Google it.
For a detailed explanation of federal law, read this article on the legalities of home distilling.