Business Use Question

[dell30rb]

As a private pilot, I know I can fly myself to meetings etc... and be reimbursed for the cost.

Say I own an agricultural consulting business and a part of this business is snapping pics with an infrared camera from the air of my customer's farms, and providing them with an analysis.

Can my business legally reimburse me for the cost of these flights?

 

[wabower]

Only if you have a common purpose with yourself while making those flights.

As a private pilot, I know I can fly myself to meetings etc... and be reimbursed for the cost.

Say I own an agricultural consulting business and a part of this business is snapping pics with an infrared camera from the air of my customer's farms, and providing them with an analysis.

Can my business legally reimburse me for the cost of these flights?

 

[dell30rb]

Only if you have a common purpose with yourself while making those flights.

Ha, that's one way to put it.

I guess what I should really be asking is if the flights are incidental to the business. I think so because the pics are not the main service of the company. I should probably delete this thread before Ron comes and shoots down my dreams.

I'm about to get my commercial certificate but the real issue is that none of the aircraft I have access to are insured for commercial use. Though I can use them for personal business - subject to the limitations of the PPL

 

[wabower]

IRS test is whether the expenses are ordinary, necessary and reasonable. If you can make a case based on those criteria, you may be OK for Round #1 of the fight.

Bear in mind that the IRS tends to look at such expenses as "hobby losses" that are not deductible, especially if they are not incurred in connection with your normal trade or business activities and do not include a reasonable chance to make some money from their use. As with all such issues, the burden of proof is on you.

Ha, that's one way to put it.

I guess what I should really be asking is if the flights are incidental to the business. I think so because the pics are not the main service of the company. I should probably delete this thread before Ron comes and shoots down my dreams.

I'm about to get my commercial certificate but the real issue is that none of the aircraft I have access to are insured for commercial use. Though I can use them for personal business - subject to the limitations of the PPL

 

[weilke]

I'm about to get my commercial certificate but the real issue is that none of the aircraft I have access to are insured for commercial use. Though I can use them for personal business - subject to the limitations of the PPL

I would get the commercial and be done with that aspect of the question.

There are a couple of interpretations on when you can do aerial photography with a private ticket.

The commercial insurance may be the bigger issue. Look at the individual companies policy. One may say that you can't use it 'for commercial purposes', another companies policy may say that you 'can't receive compensation monetary or nonmonetary' in order for coverage to be in effect. Ours just says 'for private and business use', if taking a couple of pictures here and here was incidental to my business, I would think it is covered.

 

[dell30rb]

The commercial insurance may be the bigger issue. Look at the individual companies policy. One may say that you can't use it 'for commercial purposes', another companies policy may say that you 'can't receive compensation monetary or nonmonetary' in order for coverage to be in effect. Ours just says 'for private and business use', if taking a couple of pictures here and here was incidental to my business, I would think it is covered.

I'm going to get the policy and check it out. I would not be paid as a pilot, but reimbursed for just the cost of the flight.

 

[dell30rb]

IRS test is whether the expenses are ordinary, necessary and reasonable. If you can make a case based on those criteria, you may be OK for Round #1 of the fight.

Are you referring to the company's burden to prove that the expenses they reimburse me for are ordinary - necessary - reasonable? I would think so, because aerial NDVI images are a tool (along with soil samples and visual inspections for pests etc...) the company would use to come up with planning - fertilizing - pesticide advice.

 

[poadeleted20]

The FAA has a letter out covering aerial photography -- read it. I'll post it later when i get home tonight if nobody else does first. Note, however, that in your example, flying is not "incidental" to the business, it is part of the business. IOW, you could not get those pictures without flying.

In addition, per the Mangiamele letter, one point for reimbursement is you can't have anyone else in the plane. If you're flying, who's operating the camera? If you are trying to do both, is that safe? I know of folks who crashed trying to do both.

Finally, the IRS rules are not relevant to determining what is legal per the FAA.

 

[wabower]

Were they taken at the company's request or part of your duties, or based on a benevolent and unsolicited decision on your part that some pictures would be nice to have?

Are you referring to the company's burden to prove that the expenses they reimburse me for are ordinary - necessary - reasonable? I would think so, because aerial NDVI images are a tool (along with soil samples and visual inspections for pests etc...) the company would use to come up with planning - fertilizing - pesticide advice.

 

[dell30rb]

IOW, you could not get those pictures without flying.

I could fly a kite, my drone, or rent a crane truck. I could climb a tree with my self climbing deer stand. I could launch a model rocket that would snap pictures while descending under parachute.

 

[dell30rb]

Were they taken at the company's request or part of your duties, or based on a benevolent and unsolicited decision on your part that some pictures would be nice to have?

Part of my duties would be to get CIR images and convert to NDVI using some software I have. Camera would be mounted on the plane go pro style.

PS all of this is hypothetical. I'm kicking this idea around with a friend

 

[wabower]

The issue of non-reimbursed employee business expenses can arise if you don't have the arrangement papered properly. It's a bit more difficult to pin down, and should be understood.

The FAA air photo regs are different, as RL mentioned, so you should understand them too. But I've taken a jillion pictures of our real-estate and golf course projects all over the country for 40 years, all of which are in a file drawer somewhere and nobody from any regulatory agency has ever asked who took them or how they got there.

Part of my duties would be to get CIR images and convert to NDVI using some software I have. Camera would be mounted on the plane go pro style.

PS all of this is hypothetical. I'm kicking this idea around with a friend

 

[dell30rb]

The FAA has a letter out covering aerial photography -- read it. I'll post it later when i get home tonight if nobody else does first. Note, however, that in your example, flying is not "incidental" to the business, it is part of the business.

I found several definitions for incidental but the first one that shows up on google reads "accompanying but not a major part of"

I also searched and found a 2010 FAA interpretation from a private pilot asking if he could take pictures himself, and sell these pictures at a later time or to a pre-arranged buyer. The answer was no.

However this situation is different. The pictures may not even be seen by the customer - they are not being sold.

 

[poadeleted20]

I could fly a kite, my drone, or rent a crane truck. I could climb a tree with my self climbing deer stand. I could launch a model rocket that would snap pictures while descending under parachute.

You can try that argument if you want, but it won't work. The flight described simply is not "incidental" to your work as the FAA defines that term.

 

[poadeleted20]

I found several definitions for incidental but the first one that shows up on google reads "accompanying but not a major part of"

I also searched and found a 2010 FAA interpretation from a private pilot asking if he could take pictures himself, and sell these pictures at a later time or to a pre-arranged buyer. The answer was no.

However this situation is different. The pictures may not even be seen by the customer - they are not being sold.

That argument would only strengthen the FAA's case that the flight was part of your job, not incidental to it. Unless you have a CP or higher, you can't fly as part of your job.

 

[dell30rb]

The CP is no issue, on track for that. Maybe this will give me a reason to finish up. But I would only do a photo flight maybe once or twice a month.

 

[weilke]

The CP is no issue, on track for that. Maybe this will give me a reason to finish up. But I would only do a photo flight maybe once or twice a month.

Remember, if you decide that your operation requires a CP, you also need to maintain a second class medical in order to be 'legal'.

Are you planning to mount the camera on the outside of the plane or are you going to shoot handheld with the door removed ? When I looked into internally cooled IR cameras for a calorimetric project 20 years ago, they were 30k and up. Unless they have really come down in price towards the expendable range, I don't think I would want to mount one to the strut using a clamp or duck-tape. As you want to shoot without a window in the way, you may need a plane with a camera port in the floor such as the ones used for surveying.

 

[dell30rb]

Seems like a lot of red tape to snap some pictures for my theoretical personal business.

You can get a converted CIR camera for about 1k. A professional purpouse built unit starts around 5k

 

[weilke]

Seems like a lot of red tape to snap some pictures for my theoretical personal business.

Look up the various interpretations. Letter to White from 1995 states that if you perform aerial survey without taking others along, you can do so with a private certificate. The later letter to Perry and an interpretation to Del Rossi from 1987 rescind that and and now it says you need a commercial.
Looks like they can't make up their mind sometimes.

You can get a converted CIR camera for about 1k. A professional purpouse built unit starts around 5k

While not disposable, not quite the numbers we looked at years ago. What wavelengths do these types of cameras cover ? Do you have to fill them with liquid nitrogen or do they have a cryogen unit ?

 

[Shawn]

so it should not be a problem unless you decide to complain to the FAA about yourself.

Unless the IRS questions the deduction during an audit and consults with the FAA...

 

[weilke]

You own the business. You are not carrying passengers or cargo and you are not holding out to the public, so it should not be a problem unless you decide to complain to the FAA about yourself.

Three ways how you could end up talking to someone without complaining about yourself:

- a nimby neighbor to the agricultural property complains to the FAA about your overflights at '100ft' (you have GPS logger data that shows you at 1200, doesn't matter, for nimby-man it's allways '100ft').

- aerial survey business sees your plane rigged up with the camera sitting on the ramp, asks around, runs your name in the airman database.

- while getting your IR pics, you get a bit carried away staring at your monitors, loose altitude awareness and snag a tire on a powerline.

 

[dell30rb]

Look up the various interpretations. Letter to White from 1995 states that if you perform aerial survey without taking others along, you can do so with a private certificate. The later letter to Perry and an interpretation to Del Rossi from 1987 rescind that and and now it says you need a commercial.
Looks like they can't make up their mind sometimes.

While not disposable, not quite the numbers we looked at years ago. What wavelengths do these types of cameras cover ? Do you have to fill them with liquid nitrogen or do they have a cryogen unit ?

I think we are talking about different types of cameras... here is a little write up on the NDVI stuff. I do know they use NIR (near infrared) and then apply a pretty simple formula with the color channels to normalize it.

http://www.maxmax.com/ndv_historyi.htm

No I won't be telling on myself


Also - I read both of those letters, and a few others. What I am doing is very similar to the 1995 letter. (aerial environmental survey) with no persons or property on board for hire.

In the 2010 letter, the guy asked if he could use his plane to take and sell photographs in an aerial photography business. As I pointed out earlier, I have no intention of selling my pictures to anyone.

It does sound like they contradict one another, which is not surprising.

Unless the IRS questions the deduction during an audit and consults with the FAA...

But I was just flying myself to visit a customer

 

[poadeleted20]

Seems like a lot of red tape to snap some pictures for my theoretical personal business.

When you're getting compensated for providing pilot services in furtherance of a business, it is no longer your "theoretical personal business."

 

[poadeleted20]

You own the business. You are not carrying passengers or cargo and you are not holding out to the public, so it should not be a problem unless you decide to complain to the FAA about yourself.

Read the Perry letter above -- that stuff only matters regarding the need for a commercial operating certificate. In this case, a commercial pilot certificate is still required since he's being compensated (with free flying time if nothing else) for providing pilot services to the business, and it doesn't matter who owns the business.

 

[poadeleted20]

Ron, I understand the letter of the FAA interp, I am adressing the reality of the FAA discovering the violation, which in my view is very unlikely.

I thought you were saying it would be legal if no passengers or cargo were carried for hire, not talking about whether or not one might get caught. Sorry. But I still wouldn't consider it wise to create a paper trail which could be used as evidence against him, and the financial records of the billing and reimbursement would do just that. I suspect most folks who choose to violate 61.113 also try not to leave any record of their violation.

 

[dell30rb]

I'll wager most pilots just read the regulations as written and don't read every interpretation available with an extremely pessimistic viewpoint. In other words, not 'choosing' to violate 61.113

 

[wabower]

Yeppers, every pilot I've seen walking to his plane with camera in one hand has been carrying a FAR/AIM in the other.

I'll wager most pilots just read the regulations as written and don't read every interpretation available with an extremely pessimistic viewpoint. In other words, not 'choosing' to violate 61.113

 

[weilke]

I think we are talking about different types of cameras... here is a little write up on the NDVI stuff. I do know they use NIR (near infrared) and then apply a pretty simple formula with the color channels to normalize it.

Ah, so this is basically what you used to do with 'infrared film' and 'infrared filters' using the little red hash-mark on the focus ring of the lens.
I was thinking about thermography cameras, a bit of a different animal (as they require cooling of the chip).

Also - I read both of those letters, and a few others. What I am doing is very similar to the 1995 letter. (aerial environmental survey) with no persons or property on board for hire.

Except that that letter was pretty much rescinded with the 2010 interpretation.

In the 2010 letter, the guy asked if he could use his plane to take and sell photographs in an aerial photography business. As I pointed out earlier, I have no intention of selling my pictures to anyone.

You are no different from the realtor who goes up and shoots a couple of pictures of a property he is selling. He is selling the house, not the pictures. I would think that you are ok as the picture taking is incidental to your primary job.

If you bought your pictures of landsat nobody would require you to be an astronaut either.

 

[N801BH]

.......You are no different from the realtor who goes up and shoots a couple of pictures of a property he is selling. He is selling the house, not the pictures. I would think that you are ok as the picture taking is incidental to your primary job.

If you bought your pictures of landsat nobody would require you to be an astronaut either.

 

[poadeleted20]

You asked what the law is, you got the answer including documentation signed by the Chief Counsel. Do what you want, but do so knowing that you don't get to reinterpret the regulations to suit yourselves.

-30-

 

[Dave Theisen]

Are you truly asking if its legal or are you asking if you will get caught?

I think it's pretty clear what's legal but you are hoping someone will say its ok.

 

[dell30rb]

Honestly just trolling.

 

[wabower]

You sound like one of those people who cut the labels off of their pillows.

Are you truly asking if its legal or are you asking if you will get caught?

I think it's pretty clear what's legal but you are hoping someone will say its ok.

 

[dans2992]

The FAA has a letter out covering aerial photography -- read it. I'll post it later when i get home tonight if nobody else does first. Note, however, that in your example, flying is not "incidental" to the business, it is part of the business. IOW, you could not get those pictures without flying.

In addition, per the Mangiamele letter, one point for reimbursement is you can't have anyone else in the plane. If you're flying, who's operating the camera? If you are trying to do both, is that safe? I know of folks who crashed trying to do both.

Finally, the IRS rules are not relevant to determining what is legal per the FAA.

So, I hear the Mangiamele letter has never been challenged in court, and AOPA disagrees with the interpretation.

If its never been challenged in court, does that mean nobody has ever been cited for flying with business associates and getting reimbursed by the company?

Dan