Another CFI tax deduction thread

dell30rb

dell30rb

Final Approach
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Well I searched and debated necroposting but decided to create a new one.

I am instructing full time as of next week. Here's my question, can I deduct a small amount, say 5-10 hours of airplane rental per year for currency? I don't need the time to be legally current.

For example I haven't flown a PA-28 in almost a year. I'm going to take one up by myself this week and fly an hour or so just to re familiarize myself before I start instructing in it.
 
Not a tax attorney/accountant but my understanding is that job related expenses are no longer deductible and I don't believe that would qualify as an educator expense. I don't even itemize anymore because I can't come up with $24K in deductions...
 
idahoflier said:
Not a tax attorney/accountant but my understanding is that job related expenses are no longer deductible and I don't believe that would qualify as an educator expense. I don't even itemize anymore because I can't come up with $24K in deductions...
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I deduct all kinds of "job related expenses". Exactly what fits the definition has changed, of course. Something that is required may be deductible, something that is merely desired, maybe not. Your accountant is your friend, and if you are self-employed and don't have one, get one.
 
idahoflier said:
Not a tax attorney/accountant but my understanding is that job related expenses are no longer deductible and I don't believe that would qualify as an educator expense. I don't even itemize anymore because I can't come up with $24K in deductions...
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There are A LOT of deductible job related expenses. But check with a tax specialist to see what is and isn't.
 
dell30rb said:
Well I searched and debated necroposting but decided to create a new one.

I am instructing full time as of next week. Here's my question, can I deduct a small amount, say 5-10 hours of airplane rental per year for currency? I don't need the time to be legally current.

For example I haven't flown a PA-28 in almost a year. I'm going to take one up by myself this week and fly an houror so just to re familiarize myself before I start instructing in it.
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Probably not because you will file using the standard deduction. Even if you can, you are going to save <$50 on your taxes.

Your employer should be giving you 3-5 free flight hours each year for your currency needs. If not, get on their ass.

For the hours you do pay for, 35% employee discount is about average.
 
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If you are an employee (i.e., not self-employed), a lot of the miscellaneous deductions are subject to stricter limits as of last year in order to justify tax breaks for congressmen. If you're self employed, you can still take it all off the top.

Either way, this would appear to be a reasonable tax deduction, it's just whether you can actually make use of it that is the issue.
 
dell30rb said:
Self employed. Sorry that was kind of an important detail for this question.
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I am not a practicing tax accountant so this is not advice. However, based on the fact that you are self employed and need to be familiar with an airplane you are instructing in, I would say it is a reasonable business expense to claim. It is the cost of doing business.
 
dell30rb said:
Self employed. Sorry that was kind of an important detail for this question.
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Chances are you are getting screwed in your contractor arrangement and you better educate yourself about running an aviation business very quickly.
 
I am a self-employed CFI. I do not work for, or contract with, any flight school. All of my income comes straight to me from the client. I file my business income using Schedule C. As such, all kinds of things are tax deductible, directly from my income. It's the best part about not working for anyone.

Pub 334 has lots of information on this.

Currency and proficiency flights? Absolutely. You just have to be reasonable in the eyes of the auditor. 5-10 hours would certainly be in that range, to me anyway.
Travel to trade shows and conferences? Yes (think Oshkosh)
Equipment like logbooks and foggles? Yes
CFI insurance? Yes
Car expenses? Possibly, gets complicated.
Pension plan? Definitely! I have a one-person SEP-IRA.
Foreflight subscription? Yes
Bribes and kickbacks? Um, no. (I thought it humorous that these are specifically mentioned in Pub 334. Which means that someone must have tried to claim them before.)
 
Maybe I need to move into private practice and open up a boutique tax shop for pilots.

I would be the poorest accountant in the history of the world....
 
Clip4 said:
Chances are you are getting screwed in your contractor arrangement and you better educate yourself about running an aviation business very quickly.
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Yeah I know how some flight schools will do that, but not the case here. Its a non-profit club and I can freelance all I want. As far as instructing "jobs" go its one of the better deals in the area.
 
My CPA has been cool with deducting currency flights.

Another thought, find a house for sale along your flight path, take a few photos of it and email samples to the Relator and as if he wants to buy the full sized images.
 
dell30rb said:
Yeah I know how some flight schools will do that, but not the case here. Its a non-profit club and I can freelance all I want. As far as instructing "jobs" go its one of the better deals in the area.
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Good for you and the free lance private club arrangement can be a really good deal. I encourage you to fully understand the club’s insurance. The policy likely has a clause specifically excluding you from insurance coverage even if you are a club member. Make sure you have adequate insurance with hull coverage of 70% of the value of the most expensive airplane you will instruct and the maximum available for death and injury.
 
Clip4 said:
Good for you and the free lance private club arrangement can be a really good deal. I encourage you to fully understand the club’s insurance. The policy likely has a clause specifically excluding you from insurance coverage even if you are a club member. Make sure you have adequate insurance with hull coverage of 70% of the value of the most expensive airplane you will instruct and the maximum available for death and injury.
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Fortunately the insurance is 2M smooth coverage for members and instructors. For as much flying as the club does, they have an impressive safety record.
 
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