I"d call, no I'd go in and show her the damn statement... friggin government gets enough of my money as it is...why let them get away with trying to get more illegaly..they count on you saying why bother...it's not worth it...

I'm with Iceman...don't give up a dollar..fight!!!

I moved to Idaho in April of this year. Since then, I have received three letters from the Idaho State Tax Commission, Discovery Unit.

The letters start out stating "The Idaho State Tax Commission has received information that shows you are, or were, the owner of the following aircraft: ... You may owe sales or use tax on the purchase of this aircraft. To help us make this determination, please provide the following information, ..."

There are seven numbered items of requested information, followed by #8:
"8. If your answers to questions 4 through 7 are NO, use tax is due on this aircraft. Please pay 6% of the net purchase price..."

My answers to 4 through 7 were NO, so they are telling me that I owe the tax.

Then I looked up the relevant Idaho Statute
http://www.legislature.idaho.gov/idstat/Title63/T63CH36SECT63-3621.htm
and discovered that according to the law, I don't owe the tax for two reasons:
1) Purchases before October 1, 2006 aren't taxable.
2) Articles acquired in another state while a resident of that state aren't taxable, assuming the articles were acquired at least three months prior to moving to Idaho.

So, the tax commission's letters would seem to constitute fraud.

After the first letter, I called and left a message on their voice mail explaining why I didn't owe the tax.
After the second letter, I wrote and explained why I didn't owe the tax.
I just received the third letter a few days ago. I haven't responded to this one yet.

So, the tax commission's letters would also seem to constitute harassment.

I will not pay them one cent.

yeah good for you although before this is all done you'll have to show them tax returns from your former state for the past 10 years, show pay stubs from employers, receipts showing that the aircraft was hangared/tied down out of state and submit to a TSA groping and body scan before they leave you alone....Guvmint workers... and these are the type of folks gonna administer our health care...

Let's say.... for the sake of argument only of course... that a certain resident of the proverbial state of Taxorado never received a tax bill for a purchased aircraft after 3 years of ownership. Just saying. Is he safe?

Wonder what he can do to repeat this mistake?

soyAnarchisto wrote:Let's say.... for the sake of argument only of course... that a certain resident of the proverbial state of Taxorado never received a tax bill for a purchased aircraft after 3 years of ownership. Just saying. Is he safe?

Wonder what he can do to repeat this mistake?

Based on my experience in Utah, you are responsible for the payment of sales tax or use tax depending on what your state calls it. They will get their money. You can bank on that. The only question will be what penalty will be assessed. If it's your first airplane they might wave it if you play dumb and get lucky. I wasn't so lucky on airplane #3. It cost me an extra $600 for trying to hold off. They are not responsible to send you a bill, you are the responsible party and are supposed to go to them, the assessor. As soon as I received the FAA registration in hand on the C180, I went down and paid the tax. It's not worth the stress having the tax burden looming out there waiting to pop up at an inopportune time.

Rich

If they haven't come after you in 3 years, is it reasonable to assume they are not going to? This proverbial person doesn't want to kick a sleeping dog.

Let sleeping dogs lie ^^^^

I've always suspected my state has someone that moves around the airports noting N numbers and looking for registration stickers on airplanes. A year ago I had a visit from a person at my airport nosing around my hangar when the door was open. The letter demanding payment of taxes arrived shortly after.

Keep the hangar door closed and fly under the radar whenever possible.

Rich

Gl

I suspect the revenue dept of states that have use tax scan the FAA database for new airplanes registered to addresses in their state. Then they go after those who haven't paid up. In Washington, you must register your airplane with the state DOT Aviation Division, @ $65 a year BTW. And they will not register your airplane unless / until you provide proof you have paid that use tax. Here it takes a while for them to catch up with you, but they will eventually. Don't know if there's a fine for putting it off but there probably is.

I think they got tired of people buying nice Bonanza's & coming in with a bill of sale for $10K-- nowadays they have an actual blue book of airplane values. So put a believable figure on the bill of sale if you don't want a big hassle. If they do take exception to the low price you paid, you need to be able to explain why-- the engine's run out, paint job's peeling off, no radios, lots of damage needing repair, etc.

Washington imposes a 50% evasion penalty in situations where the owner knows the use tax is due and attempts to evade payment through deceit, fraud or other intentional wrongdoing. A Washington resident who registers his or her aircraft to, say, an Oregon corporation and then simply uses the aircraft in Washington meets the test. The Washington DOR uses a variety of means to catch violators, including peeks at ramps and in hangars. Anonymous tips are also common. I mention all this because many states have similar laws.

I'm not saying I agree with that, but I can see why.
In my county, skating on the tax for even a fairly low-end airplane at $30K means $2700 in lost revenue.
Better to just fess up and pay, the best you can do is be "realistic" about what a piece of crap your new airplane is for assessed value purposes.

You guys could just do what the jet owners do and fly the airplane to a place like... Montana, without a sales tax and complete the translation there.

z987k wrote:You guys could just do what the jet owners do and fly the airplane to a place like... Montana, without a sales tax and complete the translation there.

Doesn't matter where the transaction occurs, if your a resident of Utah and that's where you base the aircraft they want their sales tax. I suspect other states have the same tax laws.

Rich

hotrod180 wrote:I suspect the revenue dept of states that have use tax scan the FAA database for new airplanes registered to addresses in their state. Then they go after those who haven't paid up. In Washington, you must register your airplane with the state DOT Aviation Division, @ $65 a year BTW. And they will not register your airplane unless / until you provide proof you have paid that use tax. Here it takes a while for them to catch up with you, but they will eventually. Don't know if there's a fine for putting it off but there probably is.

I think they got tired of people buying nice Bonanza's & coming in with a bill of sale for $10K-- nowadays they have an actual blue book of airplane values. So put a believable figure on the bill of sale if you don't want a big hassle. If they do take exception to the low price you paid, you need to be able to explain why-- the engine's run out, paint job's peeling off, no radios, lots of damage needing repair, etc.

Lots of airplanes flying around WA for ages with no state registration.

Every state has different laws. In Utah and AZ (the two places I have lived), they don't care what you do. They will track you down and want you to pay regardless of where you take delivery and if it is in a Delaware LLC, etc. Arizona does have a way out of the sales tax, but it is hard. You have to personally be buying an airplane from another AZ resident (not a corporation, has to be a person).

On the bigger planes, what most guys do is they set up an LLC and they lease the plane to their business. They then pay sales tax on the lease payments which are usually based on an hourly rate. For example, if a guy buys a 2 mil. jet, he would end up paying around 130k for sales tax up front in UT. But if he sets up the other game, he would pay sales tax on the lease payments which ends up probably being around 5-7k a year in sales tax. If you are keeping the plane for a long time, this doesn't make sense, but if you trade every 5-7 years, it is a cheaper way of doing it. Both UT and AZ are good with these structures and I have done it with both. Hope this helps.

I know a guy who maintains residences in both WA & OR. His airplane is registered in Oregon, a non sales tax state. He keeps it in Oregon for just over half the year which satisfies WA that it's an Oregon airplane.

I know a couple people who have registered their airplanes as a Delaware corp. Saves them the sales tax, but if they are a WA resident & the airplane lives in WA year-round, I think they are in violation. I think they would have to raise a red flag to be caught, but if that happened it'd be a big PITA & likely expensive. IMHO better to just bite the bullet and go legit.

Anyone remember a few years ago when WA got a bug up their ass about WA motorhomes being registered in OR? The state was missing out on a lot of tax revenue so they tasked the Washongton State Patrol with investigating Oregon-tagged motorhomes in Washington. I think if the drivers/owners had WA drivers licenses they got written up and probably ended up having to pay.

Disclosure: I have zero experience buying or licensing aircraft, but have had a few experiences licensing two and four wheeled vehicles.

I originally hail from Washington and have had some experiences licensing [clapped-out] vehicles that I have purchased well below "blue book" values, due to their poor condition. I purchased a former service truck with excessive miles and a *custom* steel bumper that was welded in place after the factory one departed the vehicle under mysterious circumstances. I bought it for $1000, when the blue book used by the Washington DMV said I should have paid $8000. I tried to tell them that it was a beat up, high mileage and low trim example, but that meant nothing to them. They told me that they were not allowed to appraise vehicles and that if my declared value varied by more than a certain amount from their accepted value, that they suspected fraud and would charge their own price. No amount of explaining and cajoling would get them to relent. I would have spent more on sales tax than my original purchase price. Ultimately, they gave me a form to fill out, signed by the seller and the buyer (myself) that under penalty of perjury, I had, in fact, purchased the truck for the declared value of $1000. Only then would they allow me to license the truck. While this doesn't relate directly to aircraft, I imagine that there is probably something similar to prove that you paid what you said you paid and not what the state arbitrarily decides your vehicle is worth.

PS I believe the form is called "Declaration of Buyer and Seller Regarding Value of Used Vehicle Sold".
http://dor.wa.gov/Docs/Forms/Misc/Decla ... Sold_E.pdf

hotrod180 wrote:I know a guy who maintains residences in both WA & OR. His airplane is registered in Oregon, a non sales tax state. He keeps it in Oregon for just over half the year which satisfies WA that it's an Oregon airplane.

I know a couple people who have registered their airplanes as a Delaware corp. Saves them the sales tax, but if they are a WA resident & the airplane lives in WA year-round, I think they are in violation. I think they would have to raise a red flag to be caught, but if that happened it'd be a big PITA & likely expensive. IMHO better to just bite the bullet and go legit.

Anyone remember a few years ago when WA got a bug up their ass about WA motorhomes being registered in OR? The state was missing out on a lot of tax revenue so they tasked the Washongton State Patrol with investigating Oregon-tagged motorhomes in Washington. I think if the drivers/owners had WA drivers licenses they got written up and probably ended up having to pay.

I've heard rumors that they use fuel pump info, when you enter in your N number, as well as flight aware and ramp presence to figure some of these things out