Charity flight tax question

[SkyVoyager]

OK...To start with, I understand that any advice I receive here should be confirmed by a tax specialist. (now that I have that out of the way...)

I'm getting a really late start to my taxes this year. Last November I participated in a few charity (yep...in conjunction with a 501(C)(3) non-profit corporation) flights to deliver Sandy relief supplies. I understand that in some way, that's tax deductible.

Does anyone know how this is handled? Is it miles, expenses (some value times number of hours in the air), etc.?

Thanks for your insight!

 

[Ted]

When I give people a tax write-off for doing flights for us, it's based on actual direct operating expenses for the plane. Since everyone thus far has been in a rental or club, that's been rental rates/club rates + fuel (if applicable).

So in your scenario, I would deduct similarly.

 

[murphey]

I fly both Young Eagles and Angelflight. Since I own the airplane I just keep the fuel receipts and report that. The folks that rent, keep the rental receipts. In 12 years I've never had any problems. Keep receipts, keep documentation on the 501(c)3 status of the organization.

 

[SkyVoyager]

When I give people a tax write-off for doing flights for us, it's based on actual direct operating expenses for the plane. Since everyone thus far has been in a rental or club, that's been rental rates/club rates + fuel (if applicable).

So in your scenario, I would deduct similarly.

I fly both Young Eagles and Angelflight. Since I own the airplane I just keep the fuel receipts and report that. The folks that rent, keep the rental receipts. In 12 years I've never had any problems. Keep receipts, keep documentation on the 501(c)3 status of the organization.

Thanks!

 

[poadeleted20]

Just went through this with my CPA last week, and he researched it with the IRS. For charity flights, all you can deduct is the direct cost of the flight (fuel, oil, landing fees, etc). That's it.

 

[Ted]

Just went through this with my CPA last week, and he researched it with the IRS. For charity flights, all you can deduct is the direct cost of the flight (fuel, oil, landing fees, etc). That's it.

You own your airplane. If you rent an airplane or are part of a club/partnership with an hourly rate, then you can deduct those costs, as well.

 

[denisd]

What about car mileage to get to the airport for the charity flight?

 

[poadeleted20]

You own your airplane. If you rent an airplane or are part of a club/partnership with an hourly rate, then you can deduct those costs, as well.

Correct.

 

[poadeleted20]

What about car mileage to get to the airport for the charity flight?

There is a much lower POV rate for charity work than for business travel -- like 17 cents per mile or something like that. It's published in the same IRS Pub as the business deduction POV mileage rate.

 

[NoHeat]

You own your airplane. If you rent an airplane or are part of a club/partnership with an hourly rate, then you can deduct those costs, as well.

It seems that you're better off doing the charity flight in a rental as compared to your own plane. The deduction will be bigger.

 

[EdFred]

It seems that you're better off doing the charity flight in a rental as compared to your own plane. The deduction will be bigger.

*shakes head*

Really?

It's a deduction, not a credit.

 

[Ted]

It seems that you're better off doing the charity flight in a rental as compared to your own plane. The deduction will be bigger.

There's something to that, but it also depends on how the plane is set up. If you're in a partnership or your plane is structured in an LLC that charges you a rental rate, that can be a different matter.

It's pretty much like the reimbursement laws for flying for work.

I don't know anyone who's chosen to rent a plane rather than use an owned one for a charitable flight, though.

 

[EdFred]

I don't know anyone who's chosen to rent a plane rather than use an owned one for a charitable flight, though.

Here's why:

My direct costs for my plane are about $70/hr. Say I fly it 4 hours for the mission. That's about $280. I get to write that off. Say I'm taxed at 20% rate. I get to pay about $55 less in taxes. Out of pocket about $225. Now, if I could rent a Comanche, it's probably going to run me $180/hr. $180 x 4 = $720 taxed at that same 20% I get to pay about $145 less in taxes. Out of pocket = $575.

Oh yeah, makes total sense to rent.

 

[poadeleted20]

It seems that you're better off doing the charity flight in a rental as compared to your own plane. The deduction will be bigger.

So will your out-of-pocket after-tax expenses. Like the old Blondie comic:
Blondie: Good news, Dagwood, I just saved us $200.
Dagwood: Great, honey -- how'd you do that?
Blondie: They were having a 20% off sale at Tudbury's, and I got $200 off.
Dagwood:

 

[wabower]

If you own or control the LLC the IRS takes a dim view of writing off the rental payments.

There's something to that, but it also depends on how the plane is set up. If you're in a partnership or your plane is structured in an LLC that charges you a rental rate, that can be a different matter.

It's pretty much like the reimbursement laws for flying for work.

I don't know anyone who's chosen to rent a plane rather than use an owned one for a charitable flight, though.

 

[Ted]

If you own or control the LLC the IRS takes a dim view of writing off the rental payments.

I believe it. Hence why I said "Can be."