A couple of years ago my dad and I bought our 180, he was in the process of retiring from farming, and I was buying some of his equipment. I paid for the plane, we put his name first on the registration, and listed the farm tractor as a trade. The values were basically the same, and we recieved the registration with no questions. It would have been about a $4000 tax bill.

Beware Colorado Aircraft Buyers

OK, time to vent a little. I FINALLY got the tax bill for the plane I bought in Mar 2009. My bill of sale and copy of cashiers check the seller deposited was suffice in proof of what I actually paid for the plane. I had heard rumors that they would deny it and just hit me with market value. So, I am happy about that. What REALLY pisses me off is the fact that the @$$h0!e$ charged me interest on the tax from the day I bought the plane until now 10 months later. Not only did they do that, they slapped me with another fine for "penalty-interest" for not paying within 20 days of purchase thus bringing interest and fines to over $200. Now how the hell was I supposed to know how much I owed 10 months ago in order to pay on time. The entire aircraft sales tax is a damn complete mystery!!! I am also paying interest for them taking 40 days to figure out what I owed after sending them the proof of purchase price. Now here's the kicker. They will give me a 3% discount on the interest and penalties if I agree and try not to fight it and just pay within 30 days. This whole process sucks!!!!!!!!!!!!!!!!!!!

I bought the plane around the same time you did Bill. This will not go over well if I have to put up with this crap (which I will).

Maybe they'll just forget about it.

Note to CO aircraft buyers: After buying a plane in the state of Colorado make sure you send the Dept of Revenue a check for taxes within 20 days of the purchase of your aircraft.

After talking to a few people that have went through this, it is your responsibility as a tax payer to be familiar with the tax laws of our state before entering into a sales agreement on an aircraft in the state of Colorado. My bad!!! I was told it doesn't do you any good to fight it, they will get your money. I will be a good law abiding citizen and just pay my taxes, interest on what was due 10 months ago, and the penalties for not doing so.

Ya I tried to beat the system also. I bought my Skywagon in April of 2008. California swaps aircraft sales info with the feds. USE TAXES they call it are due by February of 2009. I think it was August 2009 they sent me a USE TAX bill for .0775% of 55K + $653.51 in penalty and interest. $4916 Ouch.

Makes you want to get lost.....maybe that's where gump is

Mr Scout and Coyote Ugly are the only ones who even have a clue where I'm hiding out. And if GPS gets shot down by the terrorists, and they gotta use LORAN to try and find me, ain't no one gonna be coming my way with a tax bill.

Gump

GumpAir wrote:Mr Scout and Coyote Ugly are the only ones who even have a clue where I'm hiding out. And if GPS gets shot down by the terrorists, and they gotta use LORAN to try and find me, ain't no one gonna be coming my way with a tax bill.

Gump

Hey ah, I have some what of a clue to where your at But don't worry, I won't say a word to nobody!!

Bill, I posted the story about my friends problem with the CO tax people. Well he finally had to hire a lawyer and the tax people rescinded all of their BS and he paid tax on only what he paid for the plane. One letter from the lawyer is all it took.

It might help to write our elected officials. Such inconsistency is ABSURD! I hope they didn’t do this to me, I was prepared on day 1 to pay the tax I have just been waiting for the notice. Which is how it was explained to me that it works from other people who have purchased in CO.

This is worth standing up for.

Glidergeek,
Am I misunderstanding....Is that $4916 a YEARLY use fee or a one time fee? There is NO WAY I could afford flying if I had to pay that yearly.
WW

Centennial, the reason Shaun had troubles with the Dept of Revenue is the fact that he told them he paid $1 for his plane. They see right past that. They will tell you right in the letter you must prove what you actually paid for it or they will take the average price for a well equipped make and model aircraft that you have purchased. I had no problem getting them to accept a Bill of Sale the seller provided to me along with a copy of the cleared cashiers check I used to purchase the plane. I'm sure you could game the system and get the seller to write two bills of sale and give them two cashiers checks to make it look like you paid less for the plane. For me, I was honest with them from the beginning in what I actually paid for my plane. The thing I am having a hard time swallowing is the interest and penalty interest. I too have friends who tried to fight the system and hired an attorney. They lost! The bottom line is the court determined that as an aircraft buyer it is your responsibility to be familiar with the tax laws prior to entering into a purchase agreement. So that being said, it will cost me more time and money in the long run to hire an attorney than just paying $135 interest and penalties after the discount by agreeing to pay within 30 days. If there are any attorneys reading this that is willing to take on this case for less than $135, let me know.

I was pleased wiith the outcome of my audit. Nothing due.

Tim

Sometimes it's better to be straight up and honest (well, at least as honest as you can ). I can see if you say you bought a plane for $1.00, that will raise red flags!

But deals switch hands like that all the time.

Example:Joe owes his business partner John, $100K. Joe don't have the money, so Joe decides to transfer ownership of his sweet Supercub to John. John gives Joe $1.00 and sends the tax bill in saying he only paid $1.00....... Sounds honest to me!

No USE TAX is aka sales tax. We have a personal property tax like the tax on your home or other property. Supposed to be 1% (of the value) but more like 1.25% with the little add ons. Unless you aircraft is of Historical nature over 35 y/o If you pay a one time fee $35 and you exhibit it 12 or more times per year and document it you are exempt. In Ca. you must apply at your county property tax office.

I absolutely agree that honesty is the key. True about Shawn but he immediately offered to pay on the vRef or the loan he took out to fix his plane and the DOR didn’t like that. It may have turned into a pissing contest. I have read all of the correspondence between Shawn and the state and none of it ever mentioned a penalty or interest because he didn’t pay in the first 20 days of ownership.

Everyone I have asked has said the states sends you a letter and you pay the tax. Noting about 20 days to pay. Did your letter mention any penalties or late payment interest? I have been holding onto the money since I bought 13T waiting to get the letter so I can pay. Had I known I had 20 days, it would have happened in Aug.

Did the DOR cite the location of the “20 day” reference? I have been all over the fair share tax pages in the last few months making sure I could “prove” to them the rate is 2.9% of the purchase price and not the blue book value. 13T was inexpensive as 182s go so I am expecting them to say that is not enough, it’s worth XXX. I made a list of comparables to argue my case.

BTW, here is a quote from the Statement of Taxpayers Rights. “The Department will provide descriptive tax notices that explain the basis for assessments of tax and penalties and indicate the next possible collection actions. The taxpayer will be able to challenge any tax assessment by following the instructions on the billing notice.” I guess that statement is on line...go find it.

Looks like you are going to PUB, have fun and be safe.

Centennial,

I mispoke on the wording of the 20 day rule. The letter reads as follows:

The use tax is due the 20th day of the month following the date of purchase. After that time it becomes subject to interest and penalty interest per C.R.S. 39-21-109 and C.R.S. 39-26-115, and C.R.S. 39-26-207 respectively.

In my case this bought me 4 more days since I bought mine on the 26th day of the month meaning I had a total of 24 days to have the taxes paid. Nonetheless, I missed the deadline by 9 months.

(Note: I am refering to Colorado taxes only in my posts. I have no idea what other states require. Must be nice to live in CA like qmdv where you pay nothing)

So how do I know where to pay and how much to pay by the 20th of the following month if they don't send me the bill for several months?

Colorado aircraft buyers need to contact or visit:

Colorado Department of Revenue
1375 Sherman Street
Denver, CO 80261
(303)205-8292

Make sure you bring a notorized Bill of Sale. I would also bring a copy of whatever method you paid for your plane with. Make sure you do it before the 20th of following month you purchased your plane in order to avoid interest and the associated penalties. Oh yeah, bring your checkbook too, although I'm sure they will be happy to take your hard earned cash. Good Luck Tadpole.

Thanks Bill for doing our homework. This seems SO backwards, but I guess it explains why none of us have received our tax statement.

I'll make the call tomorrow and see what they say (with blood shooting out from my eyes).

Biting my tongue not to turn this into a huge political rant.

Thanks Bill, hopefully this will prevent some issues having that info. I expect it'll be awhile before I buy since I'm trying to be patient and save up for a better plane than what I've been looking at so far....besides, gonna be busy flying the 7KCAB now.