Airplane Sale Price?
- Thread starter lsimonds
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bbchien
Touchdown! Greaser!
Lisa, in some states where there is a valuation tax, there is a record. But the problem is they use tables like Vref. The declared value is frequently "$1 and OVC" (other valued consideration).lsimonds said:
I've tried this. It goes noplace. :-(
Jeff Oslick
Final Approach
Bruce is (of course) correct. On the FAA registration, 99 times out of 100, the value is written in as $1 + OVC. If you do an FAA records review for a particular airplane, you can also see the costs for any bank financing that was done, but you'll never know what percent of the deal was financed. A used airplane is always worth exactly what one buyer is willing to pay one seller for one particular airplane at a particular point in time.
In California, you are required to provide the state a copy of the bill-of-sale/sales agreement stating the purchase price so that they will send a use tax bill for the appropriate amount. I don't believe this is publically-available information, however. My county property tax bill is based on a county-estimated value, not on the purchase price.
Jeff
In California, you are required to provide the state a copy of the bill-of-sale/sales agreement stating the purchase price so that they will send a use tax bill for the appropriate amount. I don't believe this is publically-available information, however. My county property tax bill is based on a county-estimated value, not on the purchase price.
Jeff
Ken Ibold
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The "requirement" for such documentation is common, but I think it is also frequently ignored or manipulated. My airplane is registered under a Delaware corporation, yet has lived its whole life in Florida. I paid the sales tax when I bought it, but if I hadn't I don't think the state would have found out, at least not for years. Furthermore, the value of the airplane can be adjusted. For example, I could buy an "airplane" for $30,000 and then pay the seller another $50,000 in a separate transaction for the avionics and equipment beyond what is required for day VFR flight. Perfectly legal because the non-registered equipment can be characterized as a casual sale between individuals.Jeff Oslick said:
Jeff Oslick
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Ken Ibold said:
California is quite agressive in the collection of use tax on aircraft sales. I think you might be able to get away with this to a limited extent, but 1/2 the value of the aircraft would probably raise a red-flag with the tax collector.
Ken Ibold
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That's true. But it's still a legally supportable method. For example, once upon a time I bought a Mooney for half of what an "average" version would cost. But it was worth what I'd paid for it because it was a dog-with-fleas fixer-upper. Because of the variation in equipment and condition when talking about 30-year-old pieces of machinery, your "half the value" proposition is something of a non-starter unless they're out physically inspecting, which I'm sure they don't do.Jeff Oslick said:
Another sales tax story: When I bought my Mooney (out of state), I bought it as a Florida corporation and dutifully filed the state sales tax paperwork and paid the tax. Four years later the state called me wanting my state sale/use tax money. Fifteen phone calls, 12 faxes and 42 photocopies later, they accepted my protestations that I'd already paid.
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Jeff Oslick
Final Approach
Ken Ibold said:
Unfortunately, they actually do perform airport visits in California, at least at the county level, and I suspect they relay that to the State in some form. I've given up any thoughts of trying to buypass the CA tax men. There are too many of them to win.
Jeff
Ken Ibold
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Well, in no way was I advocating a tax dodge. I was only pointing out that minimizing your tax through legal (but creative) ways is not an unusual occurrence. I personally have paid the state all of the taxes that I thought were due on all of my airplane purchases. To do less would be dishonest, and afterall, the test of a person's character is what they do when they think no one's looking. That said, it's dumb to pay more than you are required to by law.Jeff Oslick said:
