I am going to pick up my SR20 in December. I am under the impression that if the airplane is kept outside California for 91 days then I don’t have to pay the sales tax. I do have binding contract before October 2nd, 2004. But if that is correct, do I still have to pay Use tax. If so, then Why bother, just pay the sales tax and bring the airplane to California. The sales tax and use tax I believe are the same rate
Thanks for the info.
Search the members forum for sales tax. other wise Google it. There was a recent change in the law. You will also find that a number of owners have been very happy with a firm in CA that advises on these issues.
Ranbir:
The firm that Bob Smoke is referring to is Associated Sales Tax Consultants in Sacramento, CA.
If your purchase contract is before the effective date of the new law (check with them) you will not owe either sales or use tax.
You will eventually owe personal property tax to the County where the aircraft is stored in California but no sales or use tax, provided your contract is early enough.
It is essential that you contact Associated BEFORE you go to Duluth to pick up the aircraft.
This field is extremely complex and requires meticulous record keeping. You should not attempt this on your own unless you are regularly involved with sales tax issues with the California Board of Equalization.
There are both storage and operational time requirements for the out-of-state period.
Many Cirrus pilots have used Portland Hillsboro KHIO. It is convenient to public transportation by way of Portland International and the Portland MAX and has a good FBO Hillsboro Aviation. Hillsboro Aviation is no longer a Cirrus SC but they are familiar with Cirrus aircraft. Hangar rents are reasonable there.
In reply to:
You will also find that a number of owners have been very happy with a firm in CA that advises on these issues.
I looked into using that firm, but all they handle is the use tax, not not other aircraft taxation issues and strategies. I opted to retain Advocate Aircraft Taxation Company, more of a full-service firm, and I’m happy so far with their services.
Not only has the California use tax recently changed regarding aircraft, but Federal law just significantly changed WRT business and personal use. By all means, get expert help before you pick up the airplane.
I did use Associated Tax Consultants and did not have a good experience. I don’t want to get into details on the web, but I had to say something and I should have said it long before.
Ranbir:
Definitely check with Associated Sales Tax Consultants. I used them last year when I purchased my Cessna 310 and they were well worth their fee. Also, check with them because I believe California just changed the law and simply buying it and flying it out of state for 90 days or 6 months I do not think is sufficient anymore.
Hi Dave,
We used Associated Sales Tax Consultants at the same time as you (the first half of 2002) and were quite happy with their work. How did they mess you up?
Cheers,
Roger
In reply to:
I did use Associated Tax Consultants and did not have a good experience. I don’t want to get into details on the web, but I had to say something and I should have said it long before.
Dave,
Don’t think it’s cricket to criticize a vendor if you aren’t prepared to share the details. I’m sure you have good reasons, but that kind of innuendo can be misused as well. If you don’t want to share the details, you could post, “I’ve had an experience, please contact me privately for details.” But if we tolerate criticism without facts, we create the potential for smears.
In reply to:
Hi Dave,
We used Associated Sales Tax Consultants at the same time as you (the first half of 2002) and were quite happy with their work. How did they mess you up?
Cheers,
Roger
What’s a typical yearly charge for these guys to do what they do?
Jerry
My record keeping and report filing with them was not as timely as it should have been. I am sure it was no where near as organized as Roger’s. This gave them right to convert me from a fixed fee to an hourly rate. The hourly rates were posted in the original documentation. AFTER receiving the exception from the state they informed me I owed them additional sums equaling more than my original fee. More than double the original fixed fee in total. At no time was I informed or given the option of continuing their services at additional costs. In addition the hourly rate was raised without any notification. It stated in the contract that they had to notify me of both of these changes. There was a comment that I conveniently objected after my exemption…I WAS NOTIFIED AFTER MY EXEMPTION. I am sure that I caused them some additional work due to my tardiness, but certainly not double the work. Don’t get me wrong, had they notified me ahead of time as per the contract, I could have made a decision on my course. I had no idea until I received a new bill.
Needless to say additional fees were spent on both sides for more attorney’s to get involved.
So that’s the news, so now you know.
In reply to:
So that’s the news, so now you know.
Thanks Dave. I’m sure that will be very helpful both for people looking at and using their service.
I had an excellent experience with them - but I must admit I was timely with the submittals.
In reply to:
What’s a typical yearly charge for these guys to do what they do?
Jerry
Jerry,
Since I only have one two-year-old data point, I don’t know what’s typical. Give 'em a call and I’m sure they’ll be happy to discuss their rate structure.
Cheers,
Roger
There is no need to use them yearly - just for the purchase. In my case I needed to prove to the Franchise Tax Board that I use the plane over 50% in out of state commerce. So, it is a six month process. Last year they took me through the process for a flat fee of $3K. I just signed a contract with them for the purchase of an SR22GR (Jan 10 delivery) and the fee was the same. Anyone who wants to buy a really nice 310?