Aircraft tax question

Thanks Matt for a decent question. The best way to answer is to remind you
an aircraft, when bought, sold, or held by an individual "person" is NOT
deemed "real property" per se.., as others would have you believe, and
therefore is not automatically seen as a "gain", simply because at that
stage it is "personal property", not real property unless (and here we go
again), the aircraft is brought, held, or used in the course of a business,
or part of some inventory for sale. It is "business activities".., NOT
individual purchases that generate "income" (as defined) through their
business P/L statements, which make these businesses "libel" to pay a tax
(after assessment)..! So now, back to the "individual" as a "tax payer"..!!
The IRS code (surprisingly enough) nowhere "defines" income to the
individual as having an "income." Then here is the sticky point with the
tax guys, as everybody has bought into the "idea" (not in the code) that an
individual is a "person" with a liability or duty to pay a tax on income
"before" having been properly accessed!! This one question is the very one
the IRS has yet to ever supply me with an answer for. Every time they have
mailed me a "Notice of Deficiency" I have simply asked them for the date,
and by whom I was accessed the amount of deficiency..!! It has never gone
beyond this stage for lo these past 22 years..!! Now, call me an idiot, a
liar, or whatever.., but do the research..!! We should all just go about
our "business", and if the IRS comes to you.., then just ask as by "law"
they must answer you..!! Worst case matter is.., if you think you might owe
some money.., then hold it aside in a saving account drawing interest and
pay them later.., AFTER they have proved that you are the "person" that owes
the tax to begin with. They can't fine you, or add penalties and interest
as long as you respond to their notice in a "timely manner", and they know
it..!!

81mm wrote:
Thanks Matt for a decent question. The best way to answer is to remind you
an aircraft, when bought, sold, or held by an individual "person" is NOT
deemed "real property" per se.., as others would have you believe, and
therefore is not automatically seen as a "gain", simply because at that
stage it is "personal property", not real property unless (and here we go
again), the aircraft is brought, held, or used in the course of a business,
or part of some inventory for sale. It is "business activities".., NOT
individual purchases that generate "income" (as defined) through their
business P/L statements, which make these businesses "libel" to pay a tax
(after assessment)..! So now, back to the "individual" as a "tax payer"..!!
The IRS code (surprisingly enough) nowhere "defines" income to the
individual as having an "income." Then here is the sticky point with the
tax guys, as everybody has bought into the "idea" (not in the code) that an
individual is a "person" with a liability or duty to pay a tax on income
"before" having been properly accessed!! This one question is the very one
the IRS has yet to ever supply me with an answer for. Every time they have
mailed me a "Notice of Deficiency" I have simply asked them for the date,
and by whom I was accessed the amount of deficiency..!! It has never gone
beyond this stage for lo these past 22 years..!! Now, call me an idiot, a
liar, or whatever.., but do the research..!! We should all just go about
our "business", and if the IRS comes to you.., then just ask as by "law"
they must answer you..!! Worst case matter is.., if you think you might owe
some money.., then hold it aside in a saving account drawing interest and
pay them later.., AFTER they have proved that you are the "person" that owes
the tax to begin with. They can't fine you, or add penalties and interest
as long as you respond to their notice in a "timely manner", and they know
it..!!

Bunch of babbling nonsense.

--
Jim Pennino

Remove .spam.sux to reply.

"81mm" wrote:

Frankly, this tread started out with the question of buying an aircraft
and paying a tax.

Original Post:

When you sell an aircraft, what taxes apply to the seller? Is this a
capital gains/loss situation? We're talking about an aircraft owned by and
registered to a private individual and used for pleasure.

On 11/25/05 09:30, "81mm" wrote:

Thanks Matt for a decent question. The best way to answer is to remind you
an aircraft, when bought, sold, or held by an individual "person" is NOT
deemed "real property" per se.., as others would have you believe, and
therefore is not automatically seen as a "gain", simply because at that
stage it is "personal property", not real property unless (and here we go
again), the aircraft is brought, held, or used in the course of a business,
or part of some inventory for sale. It is "business activities".., NOT
individual purchases that generate "income" (as defined) through their
business P/L statements, which make these businesses "libel" to pay a tax
(after assessment)..! So now, back to the "individual" as a "tax payer"..!!
The IRS code (surprisingly enough) nowhere "defines" income to the
individual as having an "income." Then here is the sticky point with the
tax guys, as everybody has bought into the "idea" (not in the code) that an
individual is a "person" with a liability or duty to pay a tax on income
"before" having been properly accessed!! This one question is the very one
the IRS has yet to ever supply me with an answer for. Every time they have
mailed me a "Notice of Deficiency" I have simply asked them for the date,
and by whom I was accessed the amount of deficiency..!! It has never gone
beyond this stage for lo these past 22 years..!! Now, call me an idiot, a
liar, or whatever.., but do the research..!! We should all just go about
our "business", and if the IRS comes to you.., then just ask as by "law"
they must answer you..!! Worst case matter is.., if you think you might owe
some money.., then hold it aside in a saving account drawing interest and
pay them later.., AFTER they have proved that you are the "person" that owes
the tax to begin with. They can't fine you, or add penalties and interest
as long as you respond to their notice in a "timely manner", and they know
it..!!



I don't know what you said here, probably because your return key is broken
on your keyboard.

In any case, from the instructions for Schedule D:

"Generally, gain from the sale or exchange of a capital asset held for
personal use is a capital gain."

"A capital asset is any property held by you except..." (What follows
doesn't include an airplane held by an individual for personal use.)

- Don
If you're faced with a forced landing,
fly the thing as far into the crash as possible.
- Bob Hoover

Your right.., these posts don't always comply with accepted syntax and
punctuation. Well, we can't keep beating this subject to death.., I say any
"asset" only apply to "business" activities, and I understand you guys say
individual also can have "assets" for tax purposes. SOoo, maybe I owe for
the past 22 years.., but the IRS has never told me so yet, or "accessed" my
"assets" yet..!!

Good old Bob Hoover.., now was that a left wing-roll, or a right wing-over
at 500 feet..?? Okay.., it's the old black boot on the silver peddle for
me.., maybe we'll live to fight another day..!!

81mm wrote:
Your right.., these posts don't always comply with accepted syntax and
punctuation. Well, we can't keep beating this subject to death.., I say any
"asset" only apply to "business" activities, and I understand you guys say
individual also can have "assets" for tax purposes. SOoo, maybe I owe for
the past 22 years.., but the IRS has never told me so yet, or "accessed" my
"assets" yet..!!

It really doesn't matter what we say, it is the IRS that matters and
they pretty clearly say that personal assets are taxable if they yield a
capital gain when sold. This is one of the more clear things that the
IRS says. :-)

Matt

But personal losses aren't deductible, right? )

So, if your neighbor needs a hoe and you have one you bought at a garage
sale for $1.00 and he gives you $5.00 for it do you report a $4.00 gain on
the sale?


Trip


In article , says...

81mm wrote:
Your right.., these posts don't always comply with accepted syntax and
punctuation. Well, we can't keep beating this subject to death.., I say any
"asset" only apply to "business" activities, and I understand you guys say
individual also can have "assets" for tax purposes. SOoo, maybe I owe for
the past 22 years.., but the IRS has never told me so yet, or "accessed" my
"assets" yet..!!

It really doesn't matter what we say, it is the IRS that matters and
they pretty clearly say that personal assets are taxable if they yield a
capital gain when sold. This is one of the more clear things that the
IRS says. :-)

Matt

Should you: yes. Will you: probably not.

"TripFarmer" wrote in message
...
But personal losses aren't deductible, right? )

So, if your neighbor needs a hoe and you have one you bought at a
garage
sale for $1.00 and he gives you $5.00 for it do you report a $4.00
gain on
the sale?


Trip


In article ,
says...

81mm wrote:
Your right.., these posts don't always comply with accepted syntax
and
punctuation. Well, we can't keep beating this subject to death.., I
say any
"asset" only apply to "business" activities, and I understand you
guys say
individual also can have "assets" for tax purposes. SOoo, maybe I
owe for
the past 22 years.., but the IRS has never told me so yet, or
"accessed" my
"assets" yet..!!

It really doesn't matter what we say, it is the IRS that matters and
they pretty clearly say that personal assets are taxable if they yield
a
capital gain when sold. This is one of the more clear things that the
IRS says. :-)

Matt

TripFarmer wrote:
But personal losses aren't deductible, right? )

Last I knew, capital losses could be deducted up to $3000/year and the
excess loss could be carried forward a number of years. I haven't
checked this lately as I haven't had the need, but I haven't heard of
this being changed.


So, if your neighbor needs a hoe and you have one you bought at a garage
sale for $1.00 and he gives you $5.00 for it do you report a $4.00 gain on
the sale?

Again, I'm not sure, but I believe there are tests as to what is a
capital asset and what isn't. At work, we only have to count things as
capital assets if they have a value of $3000 or more and a useful life
of greater than 1 year. A hoe should last more than a year, but
wouldn't meet the dollar test. I'm not sure if similar rules apply for
"personal" assets, but I suspect something similar applies.

Matt

Matt Whiting wrote:

Last I knew, capital losses could be deducted up to $3000/year and the
excess loss could be carried forward a number of years. I haven't
checked this lately as I haven't had the need, but I haven't heard of
this being changed.

That meets with what happened when I sold my last house. So. Does the purchase
and later sale of an aircraft fall in the capital gains/loss category?

George Patterson
Coffee is only a way of stealing time that should by rights belong to
your slightly older self.