Taxes

[mulwyk]

Re: Taxes

South Dakota has a 3% sales tax (ouch!) , then $12.50 per year for pre-1955 (?) planes. Projects get a break since the sales tax is based on whatever you say you paid for the initial pile of parts. And they waive the $12.50 if the bird is not airworthy in any year.

Like other states, they get your name from the FAA when you register your bird. I called the state commission office to protest and talked to a real sweet young lady there, daughter of well known old Dakota ag pilot.

I suggested that maybe I shouldn't have been so quick to register with the FAA, but she reminded me that "your little airplane will be worth a lot more later on, so you're really getting a good deal this way!" And then she, well, giggled.

Now, I hate taxes like everyone else, but if I can get 'em with a little sugar like that then I guess I don't mind so much.

Bob Gustafson

[alwaysoar]

Re: Taxes

In Vermont we have a nasty wicked witch in the tax compliance office. Been there for years and well known and detested by the flying community. I'd tell you her name, but she'd hex me for sure and somehow figure out how to collect on something. If you buy a plane and register it in VT, you have to pay a 6.5% sales and use tax one time. If you try to sneak in under the radar, beware, for she on her broom is flying around everywhere with an FAA directory and will send you a letter demanding you pay. If however, you use your plane for business, she is out of luck because theoretically you are paying tax on the income derived from your business. Some folks have created an LLC and leased their A/C back to their own LLC. She's out of luck then too. I have had two A/C on lease back and avoided tax that way too. Here's the most insidious part of VT tax law. If you sell your plane, and it flies out of state, the state will try to collect sales tax from the out-of-stater. Guess what, the new owner in Utah is not eager to pay Vt tax, so you know what happens? The witch will nail the seller in VT for the tax. However, if you deliver the A/C to another state, she can't get the tax from you because it was sold elsewhere. I've done that too. A hot air balloon. Took it to New York. Now, this thread was fun. Sorry about being long-winded, but we love to beat the witch at her evil games.

[NC36454]

Re: Taxes

How does your "state" even know that you are in possession of this "federally" regulated possession? Are you required to have some sort of markings that are issued by the "state"? If so, do you operate under a separate set of "state" guidelines rather than those set by the FAA? Does your "state" require a checkout, annual recertification, etc.? If I pass through or land in your "state" am I in some sort of violation? Maybe a new set of lawmakers is in order (for your "state")?

Ken

[alwaysoar]

Re: Taxes

The FAA publishes a register every month or so that lists aircraft changes in registration and I think sales. If you go to the FAA site, and then go to registration, you will see by state and county the status of all aircraft, and if the sale is in progress, it will show that. Our tax witch subscribes to that. To all the rest of your questions, no. We pay the one time sales and use tax, no state registration or annual fee. The most outrageous thing she tried to do was to tax the fuel in the airliners that was onboard when they landed in the state. Needless to say, the airlines were upset and had the governor intervene--they never paid any tax on that fuel.

Went out to brace my hangar roof today. Lots of wet, heavy snow fell last night, and more to come. Love it!

Ed@BTV VT
TF 527

[hangarb7]

Re: Taxes

Pennsylvania has 6% sales and use tax and an additional 1% for Allegheny County where I live, even though the airplane has never been kept here. It is in my hangar in Washington County. But they tagged me for 7% and the tax bill came right after the FAA issued the registration. In addition, the previous owner had to sign and pay to notarize a document that states what he was paid so that we couldn't fibb about the sale price.

I understand that an airplane that was purchased as parts and then finally registered after completion is tagged with tax from all the years since it was purchased. I purchased a damaged Aeronca Chief about ten years ago and hope to someday rebuild it. As soon as I register it, it will have many years of taxes to be paid. And I will pay on any materials, like covering, etc that were purchased out of state.

No yearly tax on airplanes. Yet. We have a tax witch also. She gets mad even if you just ask questions.

Jack
N44057

[alwaysoar]

Re: Taxes

As in Vermont, there are many legal ways to get around most taxes if you are creative.

[SteveR]

Re: Taxes

Amen, Paul. One of a hundred reasons we live in OK. But they will nick you bad on sales tax.
Chet Peek

I just got a letter about "Excise Tax" in Oklahoma. I just moved here from Texas, and bought my plane when I lived in Texas. Can you guys give me any tips on this? The letter says:

"An excise tax of three and on-fourth (3 1/4%) of the purchase price is levied on each aircraft that is to be registered with the FAA upon the transfer of legal ownership of any such aircraft or use of any such aircraft with this state. The excise tax is due at the time of the transfer of legal ownership or first registration is Oklahoma".

(It does say "...first registration is Oklahoma", I'm sure they meant "in Oklahoma").

So even though I owned the plane before I moved here, I have to pay "Excise Tax" at 3.5%? That kind of annoys me since I already owned the plane. Any tips? Just suck it up and pay the ransom?

[Richard Boyer]

Re: Taxes

You shouldn't have moved.......

I would call and ask for clarification and state that the aircraft isn't a new purchase. What did you have to pay to change your license plates on your car? Since it just showed up in the FAA DB, they may flag it as a new sale when it is really just a change in address.
Second, if they do still require their blood money, I would tell them I paid $1 and considerations for the aircraft. Then send them their 4 cents.

Richard Boyer
N95791

[SteveR]

Re: Taxes

You shouldn't have moved.......

I would call and ask for clarification and state that the aircraft isn't a new purchase. What did you have to pay to change your license plates on your car? Since it just showed up in the FAA DB, they may flag it as a new sale when it is really just a change in address.

New tags on the car were about $80.

Second, if they do still require their blood money, I would tell them I paid $1 and considerations for the aircraft. Then send them their 4 cents.

...and that is what is written on the sales slip... $1 + OVC. If I send them their 4 cents, won't they send their henchmen in black masks after me to verify that?

[Swick-T N7010S]

Re: Taxes

Call the State office of revenue, I moved from ND to Iowa and I called the Iowa state treasure and told them that have owned the plane for several years and just moved to Iowa. They send me a letter of exeption to send in when I registered my airplanes in Iowa. Only paid the annual state registration.


Mike

[Richard Boyer]

Re: Taxes

I'm sure you still have a copy of that bill of sale that was sent to the faa. If they really want their money, sent them a check for 4 cents and a copy of the bill of sale sent to the FAA.

What more can they say? (I'm sure I'll regret saying that!!!)


I would call and say that the aircraft was previously owned and taxes paid. This is merely a change of address.

Richard Boyer
N95791

[SteveR]

Re: Taxes

How does your "state" even know that you are in possession of this "federally" regulated possession? Are you required to have some sort of markings that are issued by the "state"? If so, do you operate under a separate set of "state" guidelines rather than those set by the FAA? Does your "state" require a checkout, annual recertification, etc.? If I pass through or land in your "state" am I in some sort of violation? Maybe a new set of lawmakers is in order (for your "state")?

Ken

I agree 100% Ken, especially with your last sentence. Taxes in Texas were much better (fewer).