Taxes, Airplane taxes that is.....

[O.P.]

I have a tax question. I've been told the aircraft tax in California is by counties. I don't know if the state taxes also. I've heard talk of states that do not tax aircraft. Does anyone know which ones they are? Or do you know of states that are airplane tax friendly?

[bdk]

I have a tax question. I've been told the aircraft tax in California is by counties. I don't know if the state taxes also. I've heard talk of states that do not tax aircraft. Does anyone know which ones they are? Or do you know of states that are airplane tax friendly?

California taxes by the county. The state however provides the assessment guidelines used by the various counties: http://www.boe.ca.gov/proptaxes/pdf/ah577final2003.pdf

I discovered that since my T-6 doesn't have an airworthiness certificate and has not yet flown as a civilian aircraft- it is not an aircraft at all! It is a CONVEYANCE!!! A conveyance does not get assessed tax- an AIRCRAFT does. Once I get my airworthiness certificate and make the first flight, then it is an aircraft subject to assessment.

Of course the county doesn't know any of this- their job is to send out tax assessments, not understand the regulations. I had already sent them a letter stating that tax was not due, but without the highlights. I guess they couldn't otherwise be bothered to read the manual. I had to send them a nasty letter telling them to stop threatening me with liens and included a copy of the paragraphs in the assessment manual with highlights showing that no tax was due. Shortly thereafter I received a notice that my "conveyance" was being removed from the assessors rolls, and would I please inform them after it flies.

I was very proud of myself since I didn't know any of this stuff until I surfed and found the assessors manual. I had spent years dodging this bullet needlessly.

[O.P.]

California taxes by the county. The state however provides the assessment guidelines used by the various counties: http://www.boe.ca.gov/proptaxes/pdf/ah577final2003.pdf

I discovered that since my T-6 doesn't have an airworthiness certificate and has not yet flown as a civilian aircraft- it is not an aircraft at all! It is a CONVEYANCE!!! A conveyance does not get assessed tax- an AIRCRAFT does. Once I get my airworthiness certificate and make the first flight, then it is an aircraft subject to assessment.

Of course the county doesn't know any of this- their job is to send out tax assessments, not understand the regulations. I had already sent them a letter stating that tax was not due, but without the highlights. I guess they couldn't otherwise be bothered to read the manual. I had to send them a nasty letter telling them to stop threatening me with liens and included a copy of the paragraphs in the assessment manual with highlights showing that no tax was due. Shortly thereafter I received a notice that my "conveyance" was being removed from the assessors rolls, and would I please inform them after it flies.

I was very proud of myself since I didn't know any of this stuff until I surfed and found the assessors manual. I had spent years dodging this bullet needlessly.

Very cool! Thanks for the info. How did they know you had the plane? I don't have an N number or anything, so I should be good for awhile. I know a guy who gets assesed because his parking spot is owned by the county, and I know another one that had to tell the county because his parking place is private. I've also heard that california has a full time employee at OKC who just pulls N numbers for the state.

Does any else know of a state that does not tax aircraft?

[bdk]

Very cool! Thanks for the info. How did they know you had the plane? I don't have an N number or anything, so I should be good for awhile. I know a guy who gets assesed because his parking spot is owned by the county, and I know another one that had to tell the county because his parking place is private. I've also heard that california has a full time employee at OKC who just pulls N numbers for the state.

The county requires the owner of the hangar to report the N-numbers of the aircraft in the hangars. They also have county employees drive around and report the N-numbers of aircraft at the tie-downs. The guy who reports the OKC info looks at the county of your residence which may be different from the county where you base the aircraft. Then they ask you to provide them a copy of a cancelled check to the other county.

In San Bernardino County, if you rent a hangar from the county they require you to pay the taxes on the land where the hangar sits because they can't collect it from themselves!

[krlang]

Well,
Massachusetts repealed the taxes on aviation about 3 years ago. This was to prevent lost business in Massachusetts from the Maintenance work and storage revenue going to other local states in New England (Connecticut and New Hampshire) was what we were told. It was a small boost in our business seeing that a few business jet operators moved down from New Hampshire because they did not have to pay taxes on their airplanes.
Hmmm, I had to pay my nickel on the 64 Bug i was given (Bill of sale had to be for a dollar), but the local Billionaire didnt have to pay a dime on his two $30Million Gulfstreams! WTF