Updated Feb. 11, 2022

The U.S. Department of Transportation recently revised SIFL rates for the six-month period from Jan. 1, 2022, to June 30, 2022. These rates are necessary when applying the IRS aircraft valuation formula to compute the value of non-business transportation aboard employer-provided aircraft as required by the Internal Revenue Service Rules Section 1.61-21(g).

COVID-19 Update

Feb. 11, 2022

SIFL rates are calculated by the U.S. DOT using airline cost and seat mile data. Due to the COVID-19 pandemic and because of government relief to the airlines, DOT publishes multiple versions of SIFL rates to account for government relief received by the airlines. Learn more about the alternative rates.

The IRS has issued rulings allowing operators to use any of the three sets of SIFL rates published by DOT when making calculations.

Unadjusted SIFL rates for the six-month period from Jan. 1, 2022, to June 30, 2022, are:

MILEAGE RANGE AMOUNT PER MILE
0-500 miles $0.2460
501-1,500 miles $0.1876
over 1,500 miles $0.1803
Terminal Charge $44.98

SIFL rates adjusted for PSP Grants for the six-month period from Jan. 1, 2022, to June 30, 2022, are:

MILEAGE RANGE AMOUNT PER MILE
0-500 miles $0.1853
501-1,500 miles $0.1413
over 1,500 miles $0.1359
Terminal Charge $33.88

SIFL rates adjusted for PSP Grants and Promissory Notes for the six-month period from Jan. 1, 2022, to June 30, 2022, are:

MILEAGE RANGE AMOUNT PER MILE
0-500 miles $0.1611
501-1,500 miles $0.1228
over 1,500 miles $0.1181
Terminal Charge $29.45

Anytime an employee is flown on an employer-provided aircraft, the flight is potentially taxable to the employee. This also is true when a non-employee guest or family member of an employee (spouse or dependent child) is onboard.

The aircraft valuation formula applies on a per-flight, per-person basis. The definition of a flight, for the purposes of computing the value of personal transportation, is “the distance in statute miles from where the individual boards the aircraft to where the individual deplanes.”

An “aircraft multiple” is applied based on the maximum certified takeoff weight of the aircraft and whether the income is to be imputed to a control or non-control employee. The aircraft multiples listed in Treas. Reg. § 1.61.21(g)(7) areas follows and do not change from year to year:

Maximum Certified
Takeoff Weight of
the Aircraft
Aircraft Multiple
for a Control
Employee
Aircraft Multiple
for a Non-Control
Employee
6,000 lbs. or less 62.5% 15.6%
6,001–10,000 lbs. 125% 23.4%
10,001–25,000 lbs. 300% 31.3%
25,000 lbs. or more 400% 31.3%

This rule may be used to value flights on all employer-provided aircraft, including helicopters. In addition, the valuation rule may be used to value international flights as well as domestic flights.

For assistance in the calculation of non-business transportation aboard employer-provided aircraft for this SIFL period, NBAA provides a Personal Use Calculator.

As a result of the American Jobs Creation Act of 2004, some personal flights classified as for recreation, amusement or entertainment may cause the company to lose business deductions. That law, and the subsequent IRS Notice 2005-45, does not negate the need to impute the value of personal use flights to the individual through the SIFL method or the fair market value method. The NBAA Personal Use Web Resource has several articles available to explain the tax law change and IRS guidance.