Federal Taxes | NBAA - National Business Aviation Association

Coronavirus Update: The suspension on federal excise tax (FET) for commercial air transportation expires on Dec. 31, 2020. Once the suspension expires, payments for commercial air transportation will again be subject to FET. Learn more about the tax implications of the CARES Act.

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IRS Provides Continued Flexibility on SIFL Rates Oct. 21, 2021: The IRS will continue to allow taxpayers to use alternative Standard Industry Fare Level rates for the second half of 2021, from July 1 to Dec. 31, 2021.
IRS Releases Guidance on Entertainment Disallowance for Sole Proprietors Sept. 17, 2021: In this members-only resource, NBAA Tax Committee member John Hoover explains the impact of the April 2, 2021 IRS chief counsel advice memorandum for sole proprietor structures and discusses reasonable allocation methods for mixed-purpose flights.
Alternative SIFL Rates Available Thanks to NBAA Advocacy June 21, 2021: NBAA advocacy led to the IRS announcing that alternative Standard Industry Fare Level rates for the first half of 2021 can be used by operators due to the significant COVID-19-related impacts on the standard rates.
Improving the Commuting Disallowance Rule June 3, 2021: An IRS rule addresses concerns regarding disallowance of deductions for commuting.
NBAA Supports Legislation to Make Immediate Expensing Permanent April 21, 2021: NBAA applauds Sen. Pat Toomey (R-PA) and Rep. Jodey Arrington (R-19-TX) for reintroducing the Accelerate Long-Term Investment Growth Now (ALIGN) Act.
FET Final Rule a Win for Industry April 12, 2021: The final rule affirms that owner trust arrangements, used to register thousands of business aircraft for regulatory compliance purposes, are covered by the FET exemption.
NBAA Resource Helps Members Navigate Tax Regulations on Meals and Entertainment April 2, 2021: NBAA members now have access to an important resource to help them interpret the impact on business aviation of IRS regulations on business meals and entertainment expenses.
NBAA Seeks Clarity on IRS Rules for Commuting Deductions Feb. 5, 2021: NBAA is seeking clarification from the IRS on final regulations implementing provisions in the Tax Cuts and Jobs Act, which eliminated employer deductions for qualified transportation fringe benefits and certain other transportation and commuting benefits.
NBAA, NATA Urge IRS to Provide Guidance on FET Collection and Liability Feb. 1, 2021: NBAA and NATA asked the IRS to continue the reform of federal excise tax regulations by addressing unclear and confusing rules covering the collection responsibilities for air charter operators and brokers.
Podcast: What the New IRS FET Rule Means for Business Aviation Jan. 25, 2021: A recently issued IRS final rule clarifies the applicability of federal excise taxes to management companies and aircraft owners and prevents the improper and retroactive application of FET charges.
NBAA News Hour: Determining the Impact of New Federal Excise Tax Rules Jan. 21, 2021: Experts from the NBAA Tax Committee noted in a recent NBAA News Hour webinar that taxpayers must carefully review FET rules to determine how they apply to specific aircraft ownership and operating structures.
NBAA’s Updated Federal Excise Taxes Guide Incorporates Changes for 2021 Jan. 5, 2021: NBAA has released an updated Federal Excise Taxes Guide to help taxpayers understand how federal excise taxes apply to this year’s business aircraft activity. It also includes topics such as FET on fractional aircraft.
Bonus Depreciation Key to Incentivizing Aircraft Transactions Dec. 8, 2020: Through bonus depreciation, also known as immediate expensing, taxpayers placing qualifying property into service, including business aircraft, can continue to deduct the full cost of their investment in new and used property in the first year of operation.
VBACE Tax Session Stresses Planning for an Aircraft Acquisition Dec. 2, 2020: Planning is key to navigating the complexities of any aircraft purchase and avoiding the potential of costly errors, tax experts explained during the NBAA GO Virtual Business Aviation Convention & Exhibition.
Entire NBAA GO Virtual Aviation Tax & Transactions Review Now Available Oct. 28, 2020: The final live session of the NBAA GO Virtual Aviation Tax & Transactions Review took place Oct. 27, 2020, and focused on the CARES Act. All six sessions are now online.
NBAA Begins Virtual Aviation Tax Review with Deprecation Session Oct. 14, 2020: NBAA’s Virtual Aviation Tax & Transactions Review launched Oct. 13, 2020, with an informative live session on the complex issues surrounding tax depreciation and deductions for business aircraft.
NBAA, NATA Seek Clarity on Excise Tax Exemption in Detailed Comments to IRS Sept. 29, 2020: NBAA joined with the National Air Transportation Association (NATA) in submitting detailed comments on a notice of proposed rulemaking regarding a legislative exemption from federal excise taxes on aircraft management services paid for by aircraft owners.
NBAA GO Sessions to Offer Best Practices for Aviation Tax & Transactions Sept. 28, 2020: NBAA announced an informative series of upcoming NBAA GO virtual professional development seminars addressing common questions and concerns surrounding aircraft transactions, ownership structures and taxation.
Reduced Business Travel Due to COVID-19 May Result in Depreciation Recapture Sept. 15, 2020: As a direct result of COVID-19, business closures and travel restrictions, aircraft purchased in 2020 could be ineligible for bonus depreciation, and depreciation recapture could be triggered on aircraft purchased in prior years.
NBAA Seeks to Preserve Commuting Deductions in Comments to IRS Aug. 26, 2020: NBAA has asked that the Internal Revenue Service employ a more equitable approach to avoid double taxation and retain critical deductions for business travel.
NBAA Welcomes Proposed IRS Rules on Excise Taxes for Aircraft Management Companies July 30, 2020: The IRS is publishing a notice of proposed rulemaking to provide regulations in response to a legislative exemption from excise taxes on aircraft management services paid by aircraft owners.
How the CARES Act Federal Excise Tax Suspension Applies to Business Aviation May 18, 2020: On a May 15, 2020, NBAA News Hour webinar, industry experts discussed the suspension of FET – and how it applies – in detail.
IRS Issues FAQ on Federal Excise Tax Suspension Reporting Issues May 14, 2020: The FAQs provide interim guidance on tax reporting issues raised by NBAA regarding the tax holiday on air transportation excise tax and fuel tax under § 4007 of the CARES Act.
What Are the Top Federal Excise Tax Exemption Filing Concerns? May 11, 2020: As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, there is a tax holiday from March 28, 2020, through Dec. 31, 2020, for FET on amounts paid during the tax holiday, and fuel tax on fuel used during the tax holiday.
NBAA Files Comments on Proposed IRS Regulations for Business Meals and Entertainment April 16, 2020: NBAA on April 13, 2020, submitted comments to the IRS concerning a recent notice of proposed rulemaking outlining the tax treatment of business meals and entertainment activities.
CARES Act Includes Tax Provisions Affecting Business Aircraft Operators April 2, 2020: The Coronavirus Aid, Relief, and Economic Security (CARES) Act includes numerous relief tax provisions that may benefit companies operating business aircraft.
Federal Excise Taxes Suspended for Many Business Aviation Operators March 31, 2020: NBAA played a key role in securing federal excise tax relief provisions included in the March 2020 Coronavirus Aid, Relief and Economic Security Act (CARES Act), including those affecting Part 135 operators.
U.S. Senate Bill Would Make Immediate Expensing Permanent Feb. 27, 2020: A bill introduced in the U.S. Senate could make a tax depreciation rule that has stimulated the sale of new and used business aircraft a permanent part of the tax code.
Who Should Collect Federal Excise Taxes? Sept. 4, 2019: IRS audits of Part 135 charter operators highlight the importance of developing and implementing best practices for collecting and remitting federal excise tax on brokered charter flights.
Podcast: NBAA Offers Guidance on Tax Reform Provisions Feb. 25, 2019: John Hoover explains some of the tax changes affecting business aviation due to the Tax Cuts and Jobs Act.
Business Meals Remain Deductible Under IRS Notice; NBAA Provides Comments Nov. 9, 2018: On Oct. 3, 2018, the IRS issued a notice that implicitly concludes that business meals are generally non-entertainment expenses and can be deductible if certain requirements are met.
NBAA Requests Clarification on Bonus Depreciation Proposed Regulations Oct. 12, 2018: NBAA submitted comments to the IRS on the definition of a written binding contract in proposed regulations relating to immediate expensing.
IRS Issues Proposed Regulations on Bonus Depreciation Aug. 16, 2018: A notice of proposed rulemaking from the IRS on the extension and modification of 100 percent bonus depreciation includes key recommendations from NBAA’s formal request for guidance.
Recent SEC Settlement on Perquisite Disclosure is Reminder for Public Companies Using Business Aircraft July 18, 2018: Public companies that operate business aircraft should review their executives perquisite disclosure policies and procedures on a regular basis to ensure they meet SEC requirements.
NBAA Urges Members to Conduct Careful Tax-Reform Planning June 28, 2018: After NBAA's June 13, 2018, letter, the association is encouraging members to familiarize themselves with changes that will impact their businesses as they plan for next tax season.
Tax Reform Highlights for Business Aviation Dec. 19, 2017: The House and Senate have both voted to pass major tax reform legislation, and are expected to send the Tax Cuts and Jobs Act (“Tax Bill”) to the president for his signature before Dec. 25, 2017. The legislation contains important changes for business aviation in several areas, including bonus depreciation, like-kind exchanges and more.
NBAA Members Urged to Contact Congress on Aviation-Related Tax Reform Issues Dec. 7, 2017: The tax reform bills include issues impacting business aviation such as immediate expensing, like-kind exchanges and taxes applicable to aircraft management companies.
Prepare Your Flight Department Now For Tax Filing Nov. 6, 2017: Be prepared for filing taxes - now is the time for flight departments to work on their tax liability. There are new tax provisions if your aircraft was damaged by Hurricanes Harvey or Irma and out-of-pocket expenses may be deductible. Listen to the NBAA Flight Plan Podcast to learn more.
When Are IRS Commercial Transportation Taxes Due for Part 91 Flights? April 6, 2017: Many business aircraft operators make use of the limited options for cost reimbursement provided by the FAA under Part 91, Subpart F of the Federal Aviation Regulations (FARs). These options include timesharing, interchange or joint ownership agreements, affiliated group operations and demonstration flights.
NBAA Legal Brief Asserts Need for IRS Consistency, Clarity on Federal Excise Tax Sept. 23, 2016: NBAA filed an amicus brief in the Fifth Circuit Court of Appeals supporting Bombardier Aerospace, the prior owner of FlexJet, in a challenge to retroactive assessments of federal excise tax on fractional aircraft management fees.
Clarifying Federal Excise Tax Regulations Aug. 26, 2016: To find out what NBAA is doing to help business aircraft operators understand the complex IRS regulations covering federal excise taxes on air transportation of passengers, read the July/August 2016 edition of NBAA's Business Aviation Insider magazine.
Tax Court Decision Provides Insights into Hobby Loss Rules Aug. 5, 2016: A tax court case involving a physician who said the use of an airplane was to further his medical practice, and attempted to claim tax deductions, highlights a potential tax trap.
IRS Priority Guidance Plan May 20, 2016: The IRS issues a Priority Guidance Plan to identify federal tax issues that should be addressed through regulations, revenue rulings and other published guidance
Tax Case Highlights Risks of Bad Recordkeeping, Hobby Loss May 11, 2016: To deduct aircraft expenses from taxable income, business owners must be able to show that the aircraft was used in a bona fide trade or business and not as a casual investment.
IRS Memorandum Has Implications for Like-Kind Exchanges, Federal Tax Planning Jan. 6, 2016: The IRS has released a memorandum that provides information to business aircraft owners considering like-kind exchanges or using special purpose entities to own and lease aircraft.
NBAA's Business Aviation Taxes Seminar Sets Attendance Record May 14, 2015: NBAA's 2015 Business Aviation Taxes Seminar (BATS), held May 8 in Dallas, TX, attracted a record number of attendees interested in learning about emerging issues in federal and state tax regulations, and how to handle them.
“Registered Ultimate Vendor” April 6, 2009: Beginning October 1, 2005, federal excise tax imposed on removal of kerosene from the terminal rack will be $0.244 per gallon. Initially, this tax will be credited to the Highway Trust Fund; the amount eligible to be transferred into the Airport and Airway Trust Fund is based on the gallons that are used in aviation.

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