Last month, the IRS delivered a final ruling prohibiting certain tax deductions for the entertainment use of business aircraft. The new limitations apply to any tax years after Aug. 1, 2012, and include expenses like fuel, landing and hangar fees, pilot salaries, depreciation, and interest.
Industry organizations like the National Business Aviation Association (NBAA) are expressing dissatisfaction with the new regulations, insisting that they are “administratively burdensome,” and that they have “produced unfairly skewed disallowances for many taxpayers.”
To help aircraft owners understand the new ruling, the NBAA is holding the NBAA Tax, Regulatory and & Risk Management Conference, Oct. 28-29, 2012, in Orlando, Fla. The event includes a well-timed session on strategies and tips to help aircraft owners mitigate any negative tax implications that may have cropped up following the final IRS ruling.
If your organization has previously filed deductions for the entertainment use of your private aircraft — regardless of whether the aircraft is leased, chartered, or owned outright — be sure to seek the advice of a qualified tax adviser to help you navigate the complex new regulations.