Selling ownership shares?

[John Baker]

It seems neither of the potential buyers for my Warrior intend on following through with it. So now I am thinking of dividing it up into three shares, myself, and two more people for ten thousand dollars each. I was out at a flight school in El Cajon yesterday and one of the owners, and older guy, but not as old as me, who possesses a great sense of humor, was relating a story about a fellow a few years back, who sold five 1/3 partnerships in his airplane. He had some unexpected legal problems.

Anyway, having never ventured in this direction, you guys have any info or tips about pursuing such a plan?

My thinking is that with three owners, we could afford a hanger, and when the engine comes due, we could hang a 180 on it and a new propeller for around eight or nine thousand dollars each. Or put a new 160 in it for around seven grand each.

During yesterdays hanger bull session, someone mentioned that AOPA has a program for sharing ownerships that has a huge backlog of buyers, and not near enough sellers. I didn't renew this year because as an old cheapskate retired guy, I figured I'd save the hundred bucks.

-John

 

[NoHeat]

someone mentioned that AOPA has a program for sharing ownerships that has a huge backlog of buyers, and not near enough sellers.

That's how it seemed when I looked at it, except I'd call it an imbalance of buyers and sellers, with lots of buyers expressing an interest in getting into something at a low price, often about $10k, and not very many people offering to sell anything.

 

[denverpilot]

John, you've basically described our little 182 tribe.

Recommendation would be to put an LLC around the aircraft, only accept people you like -- you have to get along -- then get all the legal paperwork right, and go flying.

I'll let you know how it all turns out in about ten years. Haha. So far, so good.

Our meeting this evening to chat about upcoming Annual and items we'd like to have done was so easy its wasn't a big deal at all.

Yes, put the photo window in. Don't care if it's the big one or the medium-big one. Co-owner "B" can choose. Fix the panel lights, and put an LED landing light in. Everybody agreed.

Only discussion was whether or not it's worth messing with fixing the parking brake.

Agreed we're not ready to put an Aspen or any major avionics in this year.

Went back to drinking beverages. Meeting "minutes" will be via e-mail.

 

[wabower]

This is the best idea you've had, IMO. I've done it numerous times and found it to be the best of all worlds insofar as owning airplanes is concerned.

Crafting the joint use agreement is a bit time-consuming (if you do it right) simply because of the number of things that must be considered/included in the document, including what happens at the other end when people want (or are forced) to get out.

 

[poadeleted20]

Nate and Wayne have it -- sell the plane to an LLC and have the others buy shares in it. Get a good aviation attorney to take you through the paperwork. And read the AOPA's Guide to Multiple Ownership.

 

[Chip Sylverne]

Been in a 4 way partnership in the Cherk going on 21 years. Two engines, panel upgrade, speed mods...been a great experience. Even better now that two guys don't fly anymore, but still kick in on the bills...

 

[John Baker]

Been in a 4 way partnership in the Cherk going on 21 years. Two engines, panel upgrade, speed mods...been a great experience. Even better now that two guys don't fly anymore, but still kick in on the bills...

That's what I'm concerned about. I'm not going to be able to fly in a few more years, but may be legally stuck paying my share of the bills on an airplane I can't escape from. As a sole owner, if I can't sell it, I can always donate it to get out from under it.

Most all of my missions are hamburger runs.......expensive hamburgers.

John

 

[denverpilot]

That's what I'm concerned about. I'm not going to be able to fly in a few more years, but may be legally stuck paying my share of the bills on an airplane I can't escape from. As a sole owner, if I can't sell it, I can always donate it to get out from under it.

Or find a deserving young soul who the other guys/gals like and sell 'em your share at a steep discount. May not be the best business plan, but there's always a way.

Not a darn thing wrong with that. Might as well do it until you can't.

Life will be over soon enough for all of us. May as well live it on your terms until then.

Even with all the Aviation doom and gloom there will always be some kid in the future who wants your airplane. Sell it to him or her in chunks later if you have to. Or set the expectation that the new co-owners will be buying you out over either a set period of time or that you'll give them X years of notice.

There's always options.

 

[gprellwitz]

Or find a deserving young soul who the other guys/gals like and sell 'em your share at a steep discount. May not be the best business plan, but there's always a way.



Not a darn thing wrong with that. Might as well do it until you can't.

Life will be over soon enough for all of us. May as well live it on your terms until then.

Even with all the Aviation doom and gloom there will always be some kid in the future who wants your airplane. Sell it to him or her in chunks later if you have to. Or set the expectation that the new co-owners will be buying you out over either a set period of time or that you'll give them X years of notice.

There's always options.

FIgure that after taxes you're going to recoup what, 30% max as a tax writeoff on a donation? (total guess here). If you're willing to sell your share for 40 cents on the dollar to someone new to aviation you're probably break even financially and have brought a new owner into the fold! Win-win!