Why Hire An Aircraft Tax Lawyer?
As an aircraft tax lawyer my mission is to help you purchase the right plane at the right price, capture the tax benefits of aircraft ownership and enjoy the personal convenience of private aviation.
A legally sound and carefully considered tax strategy accomplishes three things:
- Maximizes depreciation allowances, aircraft sales and use tax savings and operating cost deductions.
- Maintains the greatest flexibility in your use of the plane while remaining compliant with FAA regulations.
- Establishes a tax reporting system that requires the least amount of paperwork, human intervention and confusion.
What Qualifications Should My Aircraft Tax Lawyer Have?
Select an aircraft tax attorney with broad experience in the following disciplines:
- Aircraft Tax Audits
- Aircraft Dry Leasing
- Aircraft Depreciation and Recapture
- Aircraft Like-Kind Exchanges
- Entity Selection, Formation and Dissolution
- FAA Regulatory Compliance
- Flight Club Design
- Fractional and Co-Ownership Arrangements
- Non-US Citizen Ownership Arrangements
- Part 91/135 Leases and Management Agreements
- Sales and Use Tax Exemptions and Planning
Aircraft Sales Tax Audits – What to Expect?
Florida sales and use tax audits are on the rise. Like most states, auditors are looking for the “big ticket” items like aircraft. Consider:
(a) Aircraft buyers and sellers, operators and services companies may be unaware of the exemptions available to them, and
(b) Auditors are often similarly unaware of the laws they are trying to enforce. Florida, however, actually has a fairly robust “menu” of sales tax exemptions that should be exploited in the event you face a sales tax or use tax audit in Florida.
Florida Sales Tax Exemptions:
- The export exemption (sales to out of state or country buyers are exempt from Florida sales and use tax when the goods are manufactured or acquired for this purpose and are shipped to the buyer “uninterrupted” (i.e. not first used by the dealer or manufacturer)).
- The in-state repair and maintenance exemption (aircraft repair and maintenance is exempt from Florida sales and use tax).
- The non-resident modification exemption (non-residents that come to Florida for the purpose of upgrading, repairing or refurbishing their planes are not subject to Florida sales or use tax on those activities).
- The sale for resale exemption (aircraft “dealers” may purchase and sell aircraft and aircraft parts without having to pay Florida sales or use tax).
- The supplemental type certificate exemption (work performed in connection with a major upgrade under authority of an STC exempt).
Importantly, these exemptions are cumulative, rather than exclusive.
Documentation and Business Use
The more documented business use you’ve had for your plane, the more sound will be your defense against a federal aircraft income tax or state sales tax audit. Our activity records are nevertheless often imperfect. Think of ways that you might prove up, for example, that a specific trip was for business. If your flight log doesn’t necessarily document the business purpose of the trip, review your email to meeting participants, business partners and others that support your claim that you flew to a business destination.
A qualified aircraft tax lawyer in Florida can make the difference between hundreds of thousands of dollars – or more – in alleged sales tax due versus a favorable result utilizing the Florida sale and use tax exemptions listed above.
Get straight answers now. A tax lawyer in Miami, Fort Lauderdale and Naples, Florida, I serve an international clientele seeking aircraft tax advice.
“The key is to address aircraft tax issues up front. Aircraft tax can be a complicated area that involves income tax, sales and use tax, property tax and excise tax matters. In addition to aircraft tax issues the buyer/operator must maintain compliance with all FAA regulations. FAA rules often differ from the aircraft tax issues, requiring your qualified aircraft tax practitioner to understand the sometimes-narrow planning opportunities between the two…
- Ari Good JD LLM