AOPA has a nice brochure on this (though I suspect now the
only way to get it is to have them mail it to you).
Anyway, an airplane isn’t really considered any different
from a car as far as tax purposes and legally as a private
pilot you can be reimbursed for all the costs associated
with your air travel. I think your bigger threat here is
the IRS than the FAA. The one big thing is that pilots tend
to better contemperaneous records (we all log our time and
maintenance) for the plane than we do in our car.
-Ron
Good Day to all –
One of the reasons I got mylicense and bought my plane is to use it when I
need to go out of town on business. I own my own business (which is
incorporated) and would like to "write off" some of the expense of flying.
I know of the FAR’s concerning this say I can accept payment from "others" to
contribute towards expenses, but what if I’m just flying myself? Can I claim
as expense the cost of fuel, tiedowns, etc. What about a portion of my
hanger, insurance, etc.
In other words, how do you pilots out there that own your own plane and
business go about this (if you do), and still stay within the regulations.
Thanks!
–
Terry Pickering CompuGroup, Inc.
compu…@teleport.com 10101 SW Barbur, #203
picker…@4j.lane.edu Portland, OR 97219
http://www.teleport.com/~compugrp
IZCC# 704 Cessna 172 – N999QA (503) 245-7178
Ron Natalie wrote:
> AOPA has a nice brochure on this (though I suspect now the
> only way to get it is to have them mail it to you).
> Anyway, an airplane isn’t really considered any different
> from a car as far as tax purposes and legally as a private
> pilot you can be reimbursed for all the costs associated
> with your air travel. I think your bigger threat here is
> the IRS than the FAA. The one big thing is that pilots tend
> to better contemperaneous records (we all log our time and
> maintenance) for the plane than we do in our car.
> -Ron
But how do you figure "all the costs associated …." The "hard costs" such
as fuel, oil, etc is easy. But in addition, I set aside $7.50 per hour for
annual, plus $100 per month (my 1/3 share) for insurance and hanger. Then
there was my initial cost to buy into the plane, so do I figure depreciation?
I’ll contact AOPA and ask for that brochure. Thanks for your suggestion
–
Terry Pickering CompuGroup, Inc.
compu…@teleport.com 10101 SW Barbur, #203
picker…@4j.lane.edu Portland, OR 97219
http://www.teleport.com/~compugrp
IZCC# 704 Cessna 172 – N999QA (503) 245-7178
In article <3214B5AC.2…@teleport.com>, Terry Pickering
<compu…@teleport.com> wrote:
> Good Day to all –
> One of the reasons I got mylicense and bought my plane is to use it when I
> need to go out of town on business. I own my own business (which is
> incorporated) and would like to "write off" some of the expense of flying.
> I know of the FAR’s concerning this say I can accept payment from "others" to
> contribute towards expenses, but what if I’m just flying myself? Can I claim
> as expense the cost of fuel, tiedowns, etc. What about a portion of my
> hanger, insurance, etc.
It’s best to separate this into two different categories: What the IRS
cares about, and what the FAA cares about. The IRS only cares about
getting as much of your money as possible, and I don’t know much about
doing deductions. (Heck, I don’t make enough money for it to matter
much!)
As for what the *FAA* cares about, that’s another issue entirely.
Basically, as a private pilot, you’re not allowed to fly passengers or
property for compensation or hire, per FAR 61.118. HOWEVER… it says
"Except as provided in paragraphs (a) though (d)."
And here’s what paragraph (a) says: "A private pilot may, for compensation
or hire, act as PIC of an aircraft in connection with any business or
employment if that flight is only incidental to that business or
employment and the aircraft does not carry passengers or property for
compensation or hire."
Your going-out-of-town-for-business is EXACTLY what that exception had in
mind, so you’re fine. At least with the FAA. :-)
–
Garner R. Miller, Flight Instructor
Hawthorne Aviation – Ocala, Florida
*WARNING* — NO JUNK MAIL. Spam will be returned hundredfold.
oops! Be very careful here. What you put away for future repairs is
not a cost of operation, it is a savings plan.
Your costs are actual, not anticipated. Whey you make your monthly
mortgage payment on your home and include a payment to tax escrow, you
don’t deduct that, you only deduct the actual taxes. Your engine
reserve is not an expense.
Secondly, if you take depreciation, you better be in a position to show
that the plane was used almost exclusively for business purposes, and
when you sell it, you will have to reduce your basis by the
depreciation, making for a whopping capital gains tax bite. General
rule is you don’t depreciate an asset that is appreciating in value.
> But how do you figure "all the costs associated …." The "hard costs" such
> as fuel, oil, etc is easy. But in addition, I set aside $7.50 per hour for
> annual, plus $100 per month (my 1/3 share) for insurance and hanger. Then
> there was my initial cost to buy into the plane, so do I figure depreciation?
Things are generally deductible as you pay them. Reserves and borrowing
money
do not figure into the equation (though interest may be an expense or
income
depending on which way it is going). Generally, you depreciate that
percentage
of the asset that you are using for the business and this is done on a
schedule
that your accountant will surely know.
-Ron