California tax: aircraft use in first six months

[diamond]

According to CA Regulation 1620:

3. If the property is an aircraft, use tax will not apply if one-half or more of the flight time traveled by the aircraft during the six-month period immediately following its entry into the state is commercial flight time traveled in interstate or foreign commerce.
​

Does anyone know if the "interstate" flight time referred to means specifically flight time out of the state, or the total number of hours flown for which the purpose was interstate commerce (even if some of the hours on that flight were flown in CA)?

 

[DrMack]

Related hypothetical scenario: currently reside in Nevada, own 1/2 share in a C182. Buy out partner and then move to CA. Will CA want "use" tax?

 

[trepine]

http://generalaviationnews.com/2011/02/23/beware-the-tax-man-in-another-state/

 

[N747JB]

It appears to exempt airlines and 135 operations from use tax.
If you buy and base a privately owned airplane in California, they will expect to collect sales or use tax. The states don't care where it's registered, if you and the airplane live in California, or most any state will want to collect sales/use taxes. For example, I live in Georgia, my airplane is registered in Delaware, I paid Georgia sales tax, because the airplane in based in Georgia. Some states are more active in collecting these taxes, I think California needs the money as bad as any of them.

 

[Art VanDelay]

California - love the climate but can't stand the politics or the traffic. Taxation there can only get worse. How else are they gonna pay for all that stuff ? More people there than the entire nation of Canada with the bulk all living in one county.

 

[JoseCuervo]

California - love the climate but can't stand the politics or the traffic. Taxation there can only get worse. How else are they gonna pay for all that stuff ? More people there than the entire nation of Canada with the bulk all living in one county.

I am not sure any of that is Calif specific. Every State needs tax revenue, and they will take it out of their citizen's pockets, just depends on which pocket they take it out of.

 

[MichiPilot]

Related hypothetical scenario: currently reside in Nevada, own 1/2 share in a C182. Buy out partner and then move to CA. Will CA want "use" tax?

Generally, they'd expect use tax if california's sales tax rate is higher than nevada. You'd be expected to pay the difference between the rates if applicable.

 

[DrMack]

Generally, they'd expect use tax if california's sales tax rate is higher than nevada. You'd be expected to pay the difference between the rates if applicable.

Is CA use tax a one-time deal or is it assessed every year like a property tax?

 

[MichiPilot]

Is CA use tax a one-time deal or is it assessed every year like a property tax?

It should be a one-time deal. Now, alot of it relies on self-reporting. But, there are those that 'forget' to submit the appropriate documentation...but be careful as more and more states are looking for high-dollar opportunities to chase after folks not paying their use tax. Some carry a nice 'late' penalty.

 

[timrb]

Is CA use tax a one-time deal or is it assessed every year like a property tax?

The sales tax is one-time. However, some counties or municipalities will charge yearly property taxes. Just because they can, I guess--after all, if you own an airplane you must be rich. I even pay property tax on my hangar, which is owned by the city of Watsonville.

Tim

 

[weirdjim]

California - love the climate but can't stand the politics or the traffic. Taxation there can only get worse. How else are they gonna pay for all that stuff ? More people there than the entire nation of Canada with the bulk all living in one county.

Ah, not the bulk, but a fair amount. USA population is 300M, California population is 30M. LA county is 3M. 10% the way I do the calculations across the board. Now if you include surrounding urban counties like Orange, San Berdoo, Riverside, and San Diego, you MIGHT get up to 20%.

But your point is well made, and I have a question. You call that living?

Jim
A firm believer in the state of North California.

.

 

[Fearless Tower]

Is CA use tax a one-time deal or is it assessed every year like a property tax?

The use tax is a one time tax paid to the BOE (State).

You also pay an annual property tax that is assessed by the county which may vary from county to county.

 

[weirdjim]

The sales tax is one-time. However, some counties or municipalities will charge yearly property taxes. Just because they can, I guess--after all, if you own an airplane you must be rich. I even pay property tax on my hangar, which is owned by the city of Watsonville.

Tim

It isn't property tax, it is possessory interest tax on the hangar. The same taxes are levied on automobiles; sales (use) tax when you buy it and two registration/license fees to the state every year. Cities/counties are prohibited from doing personal property tax on automobiles or it would be double taxation.

Not that I agree with it, I'm just apologizing for it.

Jim
.

 

[Fearless Tower]

It should be a one-time deal. Now, alot of it relies on self-reporting. But, there are those that 'forget' to submit the appropriate documentation...but be careful as more and more states are looking for high-dollar opportunities to chase after folks not paying their use tax. Some carry a nice 'late' penalty.

If you purchase an airplane and register it with the FAA at a California address, the BOE and the county will send you a bill. The only part that is 'self-reported' is the amount. If you don't declare the purchase price on the bill of sale you send to the FAA, then it is up to you to report to the BOE what the purchase price was in order to assess the tax.

 

[Fearless Tower]

It isn't property tax, it is possessory interest tax on the hangar.
.

I don't think that is quite right. You will be assessed an annual tax on the airplane by the county regardless of whether it is hangared or not....at least in San Diego County.

 

[timrb]

It isn't property tax, it is possessory interest tax on the hangar.

Thanks--I feel much better now. Anyway, you're right; they call it a possessory interest tax, whatever that means. I just call it a cheap shot. I do pay a separate tax on the plane itself.

Tim

 

[Fearless Tower]

Thanks--I feel much better now. Anyway, you're right; they call it a possessory interest tax, whatever that means. I just call it a cheap shot. I do pay a separate tax on the plane itself.

Tim

Okay, so there are two separate annual county taxes, one on the airplane and one on a hangar?

When I lived there, I kept the 170 tied down outside at MYF and only ever got a county bill for the airplane itself.

 

[weirdjim]

Okay, so there are two separate annual county taxes, one on the airplane and one on a hangar?

When I lived there, I kept the 170 tied down outside at MYF and only ever got a county bill for the airplane itself.

Current California practice is to assess the airplane as personal property and the land that the airplane is leased on from the County as possessory interest. If there is a hangar on that property is is assessed as personal property if you own it and possessory interest if you lease it from the COunty.

I had a C-120 tied down at Gillespie and a C-170 & 172 tied down at Montgomery for twenty some years. That's the way it works.

Jim

Jim

 

[Datadriver]

According to CA Regulation 1620:

3. If the property is an aircraft, use tax will not apply if one-half or more of the flight time traveled by the aircraft during the six-month period immediately following its entry into the state is commercial flight time traveled in interstate or foreign commerce.
​

Does anyone know if the "interstate" flight time referred to means specifically flight time out of the state, or the total number of hours flown for which the purpose was interstate commerce (even if some of the hours on that flight were flown in CA)?

Get out of there and move to Texas

 

[Palmpilot]

Get out of there and move to Texas

A relative of mine tried living in Texas and hated it. He came back to California.

 

[JoseCuervo]

Get out of there and move to Texas

Property taxes in Texas are pretty outrageous, wouldn't you say?

 

[Art VanDelay]

Ah, not the bulk, but a fair amount. USA population is 300M, California population is 30M. LA county is 3M. 10% the way I do the calculations across the board. Now if you include surrounding urban counties like Orange, San Berdoo, Riverside, and San Diego, you MIGHT get up to 20%.

But your point is well made, and I have a question. You call that living?

Jim
A firm believer in the state of North California.

.

No Jim, I would not call that living. Don't know how young people in those areas will ever afford home ownership either. I too would be all for splitting the state in half.

 

[Fearless Tower]

Current California practice is to assess the airplane as personal property and the land that the airplane is leased on from the County as possessory interest. If there is a hangar on that property is is assessed as personal property if you own it and possessory interest if you lease it from the COunty.

I had a C-120 tied down at Gillespie and a C-170 & 172 tied down at Montgomery for twenty some years. That's the way it works.

Jim

Jim

So you got two different bills?

I only ever received one.

 

[Ghery]

The sales tax is one-time. However, some counties or municipalities will charge yearly property taxes. Just because they can, I guess--after all, if you own an airplane you must be rich. I even pay property tax on my hangar, which is owned by the city of Watsonville.

Tim

Ah, not the bulk, but a fair amount. USA population is 300M, California population is 30M. LA county is 3M. 10% the way I do the calculations across the board. Now if you include surrounding urban counties like Orange, San Berdoo, Riverside, and San Diego, you MIGHT get up to 20%.

But your point is well made, and I have a question. You call that living?

Jim
A firm believer in the state of North California.

.

It isn't property tax, it is possessory interest tax on the hangar. The same taxes are levied on automobiles; sales (use) tax when you buy it and two registration/license fees to the state every year. Cities/counties are prohibited from doing personal property tax on automobiles or it would be double taxation.

Not that I agree with it, I'm just apologizing for it.

Jim
.

Thanks--I feel much better now. Anyway, you're right; they call it a possessory interest tax, whatever that means. I just call it a cheap shot. I do pay a separate tax on the plane itself.

Tim

Same deal with boats. When we lived in California (escaped a bit over 19 years ago, not moving back) we had a boat that Alameda County taxed. At a valuation twice what I paid for it. I asked if that was an offer to buy. Would have cost more to fight the excess tax levy than it cost me. We had a slip in a municipal marina for a while. Rent the slip from the government and then get hit with the possessory interest tax. Gotta love those money grubbing politicians.