Use Tax

[base698]

Yet another tax I just found out about?  Anyone in California have experience with this?  Looks like it's due on the 12th month after the purchase.  

 

https://www.boe.ca.gov/sutax/usetax.htm

 

LA County has a 1% tax/year for planes tied down as well.  

[MHemperly]

Yep

[mike_elliott]

Yet another tax I just found out about?  Anyone in California have experience with this?  Looks like it's due on the 12th month after the purchase.  

 

https://www.boe.ca.gov/sutax/usetax.htm

 

LA County has a 1% tax/year for planes tied down as well.  

Ahh yes, the Caliban at its' finest! 

[dtoelke]

Use tax = sales tax.  It's not a separate tax on top of sales tax.  Most states have it, but California is definitely one of the highest and the hardest to get around paying.  Don't be fooled by the 12-month due date though.  It's either 12-months after the purchase OR the end of the month following your receipt of the state use tax notification.  I thought the same thing (figured I had a year before that bill hit) and got a nasty surprise in the mail two months after purchase

[Guest]

Why all the complaining about a use tax?

I used the link to open the page to read that the "Use Tax" is "Good for You". Who would have ever thought otherwise?

Clarence

[FlyDave]

Why all the complaining about a use tax?

I used the link to open the page to read that the "Use Tax" is "Good for You". Who would have ever thought otherwise?

Clarence

 

Da Comrade!

Notice everyone in the propaganda (pictures) are smiling....They must be happy to pay more F#*#@&%?[*&\}]!@7ing taxes.

[Hank]

I paid Use Tax when I bought a car in NC back in 1996. Keep your receipt, and add it in next year on 1040 Schedule A under "Other Taxes Paid."

[joepilot]

I thought their site mentioned a 10% tax, but I was charged at my county's rate (8%). I waited for them to bill me, which was a few months after purchase.

Aside: I don't condone the liberal politics out here in CA, but I'm addicted to the weather; about the best in the U.S. And year round flying with low humidity, stable Pac air masses & only isolated t-storms within 500 miles. Could be worse (IL, NJ, MN, CT, etc) with sh* t weather.

[chrisk]

When you get tired of the taxes and regulation, leave.  There are plenty of other nice places.  As for some thing useful, I recall hearing something about an exemption for older planes and displaying them periodically.

[Marauder]

When you get tired of the taxes and regulation, leave. There are plenty of other nice places. As for some thing useful, I recall hearing something about an exemption for older planes and displaying them periodically.

Or move to Delaware

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[Marauder]

Why all the complaining about a use tax?

I used the link to open the page to read that the "Use Tax" is "Good for You". Who would have ever thought otherwise?

Clarence

Says the man from the land of GST and PST! Next thing you will be telling us is that socialized medicine is good as long as you aren't sick!

But I do thank you for the cheap gas when the Middle East (for the first time) was PO'd at the United States and just a quick run across the Peace Bridge fixed all that!

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[bonal]

I'm not aware of a use tax we do have a sales tax like most states but I do have to pay a property tax each year as my plane is considered a luxury same as my boat and its assessed based on the estimated value. So once they figured out my ownership the county sent me a form I had to help them determine the value. As for the antique aircraft status you must show the plane at least a dozen times and now you have to be more detailed on the events and number of attending etc.

[Guest]

Luckily our HST is a one time tax on just about everything. I don't get a yearly tax bill from the city, the county or who ever else feels they're entitled. For my business plane it's all recovered, on the private airplanes its a loss.

Clarence

[ryoder]

Move to Florida. Never worry about terrain again

[Marauder]

I'm not aware of a use tax we do have a sales tax like most states but I do have to pay a property tax each year as my plane is considered a luxury same as my boat and its assessed based on the estimated value. So once they figured out my ownership the county sent me a form I had to help them determine the value. As for the antique aircraft status you must show the plane at least a dozen times and now you have to be more detailed on the events and number of attending etc.

Luckily our HST is a one time tax on just about everything. I don't get a yearly tax bill from the city, the county or who ever else feels they're entitled. For my business plane it's all recovered, on the private airplanes its a loss.

Clarence

Move to Delaware, right Dan? At least Dan hasn't said, go south Marauder! Go south! At least not yet!

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[carusoam]

1% per year...?

Now I have a solid reason to really like my crappy weather....

That money is better spent on training and Avgas.

Wait til you get the previous owner's tax bill sent to you with your name on it... (Thank you Phoenix)

Best regards,

-a-

[AndyFromCB]

Don't move to Iowa. Shit for weather and taxes a bit higher than CA. 

[bonal]

Move to Florida. Never worry about terrain again

Our terrain is what makes western flying fun. And if you want flat a quick hop over the hills (you guys back east call them mountains) and we have the Central Valley, flat as a pancake and more square miles than most states are in total. Watching weather news at least our mountains stay put those nasty weather systems east of the Rockeys move about and can tear your ship up as bad as any terrain. Open invitation to all my eastern Mooniacs to come out and fly the western states you can't imagine how beautiful it is.

[carl]

i just got my use tax notice . too

i didnt know about it . pennsylvania .

but i think alaska doesnt have one

[bonal]

As for the high taxes Its not so much the paying its the way they waist my money on so much useless crap that pisses me off. I need to contact the board of equalization cause I did not get my bill for last year. Which sucks

[Jerry 5TJ]

Yet another tax I just found out about?  Anyone in California have experience with this?  Looks like it's due on the 12th month after the purchase.  

 

https://www.boe.ca.gov/sutax/usetax.htm

 

LA County has a 1% tax/year for planes tied down as well.  

I went through this.   Caveat -- I am not a lawyer or CPA... 

 

There is Sales tax, and annual property tax. 

 

California is one of the more straight-forward states to deal with in that IF you meet the use requirements the BoE will issue you a written statement that the aircraft sales transaction is sales tax exempt.   IF you meet the requirements...I went through this with our P46T purchase.  It took careful attention starting BEFORE the sales transaction.  The transaction needed to take place out of state, the first business use must be inter-state (preferably out of state at both ends) and then the aircraft must be used in INTER-STATE business > 50% of the flights / hours for a 6 or 12 month test.   It took lots of documentation and not a little care.  We documented >65% business hours Inter-state in a 6 month test period and gained the exemption.  That saved 9.5% of the purchase price (rate varies by county).   It cost me at least 60 hours of effort to document, package, present and defend the claim. 

 

There are law firms that specialize in this documentation.  It is probably not worth your trouble to use them for a M20J purchase as their fee will consume all your tax savings.   If you're moving up to a Citation X, seek their help before you sign any purchase agreement.     

 

Yes, there is also a CA county property tax of about 1% annually.   That is due unless you keep the plane out of state MORE than 180 days, and can prove it every year.   We pay the 1% tax as in fact we keep the plane in California.  Fortunately the property tax is based on an assessed valuation which can be appealed. 

 

If you purchased your new plane in California, and then went on a non-business "first test flight" intra-state, well, in my lay opinion, you're screwed as far as avoiding the sales tax as you just failed the first two test conditions for exemption.   

 

Also, if the plane is more than 30 (or so) years old you can avoid the annual CA property tax if you display the plane publicly for at least 10 or 12 days per year.   My Mooney "C" qualifies for this exemption.  Good excuse to go to a lot of air shows. 

[Hank]

Join the Mooney Ambassadors. Four three-day weekends on display will fix that 30-year and older exemption. Jolie lives in CA, she'll get you set up. And the shirts are cool!

[DXB]

i just got my use tax notice . too

i didnt know about it . pennsylvania .

but i think alaska doesnt have one

Just be glad you don't live in Philly- did my homework and thought I'd be paying the 6% Pennsylvania rate, then got the bill for 2% higher because I live in Philly.  At least Pennsylvania did away with tax on maintenance and avionics recently.  

[47U]

Aircraft sales between family members are also exempt from the CA BOE use tax, even if you transfer between states. I got a couple extra days visiting on the farm (in Iowa) waiting for the weather to clear up to VMC back in the fall of 2008. Thanks, Dad! 20 years I owned that Cherokee 160. It was great. Going on 6 years now on my (Dad's) Mooney? FANTASTIC!!!

[BGF_Yankee]

We have this in Tennessee.  I thought I had done my due diligence when buying my first aircraft.  Only after did someone mention this to me...so I paid it...late, but I paid it.  Thankfully I was able to find someone reasonable to deal with at the Department of Revenue here.  When I bought my second aircraft, I factored the Use Tax into my financing...made it SO much easier!  At least this is something I only have to pay once and not every year like in some other states.  I don't mind so much this time around since we plan on staying put for awhile and keeping the aircraft long term.