Results 1 to 12 of 12

Thread: Unique Situation? Avoiding Sales and Use Tax

  1. #1

    Join Date
    Feb 2020
    Location
    San Diego, CA
    Posts
    95
    Post Thanks / Like

    Unique Situation? Avoiding Sales and Use Tax

    Death and taxes... I know.

    I'm currently a CA resident and am in escrow on a plane in Oregon. Coincidentally, my wife and I are considering moving to Bend, OR for several months. Not to avoid CA sales tax on the plane- it just worked out that way with timing as I actually found the plane while on a trip visiting the area considering a relocation which maybe temporary as we have a house lined up to rent for 5 months. I then stumbled upon a hangar in bend that is open for me.

    I'm curious if I take possession of the plane in Oregon, don't bring it back to CA but leave it in Bend, and have an Oregon address will that negate my need to pay CA sales and use tax.

    What if I move back to CA in 6 months? Are they going to come after me.
    Thanks JeffP thanked for this post

  2. #2

    Join Date
    May 2017
    Posts
    1,212
    Post Thanks / Like
    I can't say about CA taxes, but most states get a listing of all the aircraft registered to an address in the state each month and will try and track you down. If you register it to the OR address, then likely the OR tax authorities will be looking for their hand out. If registered to a CA address, then CA will want their handout.
    Likes mixer liked this post

  3. #3

    Join Date
    Sep 2003
    Posts
    7,678
    Post Thanks / Like
    You need to check with a specialist. It is possible to avoid the use tax, but it may take longer than six months. And it may involve the aircraft not crossing the border during that time. Very strict rules, and they watch.
    Likes CWilson liked this post

  4. #4
    hotrod180's Avatar
    Join Date
    May 2008
    Location
    Port Townsend, WA
    Posts
    3,743
    Post Thanks / Like
    If you move back to CA with it later, you may owe tax on it at that time.
    When registering an airplane (or car) when you move to WA, you must show proof of use or sales tax paid somewhere-
    otherwise you have to pay the use tax here.
    Cessna Skywagon-- accept no substitute!

  5. #5

    Join Date
    Dec 2006
    Location
    Meanwhile,...
    Posts
    5,468
    Post Thanks / Like
    Where will you be a legal resident of at the time of sale and where will the aircraft be registered? Likely if you move to Oregon for a brief time then back to California you would have to prove or pay taxes were paid at the time of re-registering.
    Remember, These are the Good old Days!

  6. #6

    Join Date
    Feb 2020
    Location
    San Diego, CA
    Posts
    95
    Post Thanks / Like
    I talked to Julie Alston at Aero and Marine Tax Speicalists with free 30 minute consult and she got it sorted for me. I can avoid the tax assumming the following:

    1. I take possession in Oregon and Sales agreeement states so.
    2. I register it to Oregon address.
    3. For 12 months I keep it out of California (never landing once in CA)

    She said if tax board contacts me I need records, including:
    1. All receipts for plane/fuel/maintenance etc. during 12 months
    2. Hangar receipts
    3. Flight logs

    She says if I do above I am good to go. If I come back to CA in less than 12 months then sales tax is due.
    Thanks sjohnson, Jim Hann thanked for this post
    Likes jrussl, SJ liked this post

  7. #7
    aktango58's Avatar
    Join Date
    Aug 2004
    Location
    18AA
    Posts
    9,711
    Post Thanks / Like
    Quote Originally Posted by Cardiff Kook View Post
    I talked to Julie Alston at Aero and Marine Tax Speicalists with free 30 minute consult and she got it sorted for me. I can avoid the tax assumming the following:

    1. I take possession in Oregon and Sales agreeement states so.
    2. I register it to Oregon address.
    3. For 12 months I keep it out of California (never landing once in CA)

    She said if tax board contacts me I need records, including:
    1. All receipts for plane/fuel/maintenance etc. during 12 months
    2. Hangar receipts
    3. Flight logs

    She says if I do above I am good to go. If I come back to CA in less than 12 months then sales tax is due.
    A key to all is where the plane is registered. If you house/address the plane in one state, that would be the one you are beholden to. Many people keep motorhomes, cars and such down south and live up here- but spend long periods down south. Most of them keep residency up here, so register their vehicles up here.

    A number of pilots from south house planes up here, and registered them here.

    Alaska has no tax on aircraft.
    I don't know where you've been me lad, but I see you won first Prize!
    Thanks Poor Joe thanked for this post

  8. #8
    akavidflyer's Avatar
    Join Date
    Apr 2010
    Location
    Soldotna AK
    Posts
    230
    Post Thanks / Like
    Quote Originally Posted by aktango58 View Post
    A key to all is where the plane is registered. If you house/address the plane in one state, that would be the one you are beholden to. Many people keep motorhomes, cars and such down south and live up here- but spend long periods down south. Most of them keep residency up here, so register their vehicles up here.

    A number of pilots from south house planes up here, and registered them here.

    Alaska has no tax on aircraft.

    The state of AK doesn't tax the aircraft, but many municipalities do..
    Likes Dave Calkins liked this post

  9. #9
    WhiskeyMike's Avatar
    Join Date
    Jun 2003
    Location
    West Boxford MA
    Posts
    990
    Post Thanks / Like
    Quote Originally Posted by dgapilot View Post
    I can't say about CA taxes, but most states get a listing of all the aircraft registered to an address in the state each month and will try and track you down. If you register it to the OR address, then likely the OR tax authorities will be looking for their hand out. If registered to a CA address, then CA will want their handout.
    Looks like Oregon has a $65 registration fee only. California, on the other hand will be after you like the furies from Hell. If you park at a SoCal airfield for more than a few days, then a tax person will come looking for you for a handout. They do NOT understand or care about logic. Avoid registration, tie down agreements etc in CA at all costs. (yes, even a tie down agreement of any kind will generate a tax in CA.)

  10. #10

    Join Date
    Jan 2016
    Posts
    67
    Post Thanks / Like
    Quote Originally Posted by WhiskeyMike View Post
    Looks like Oregon has a $65 registration fee only. California, on the other hand will be after you like the furies from Hell. If you park at a SoCal airfield for more than a few days, then a tax person will come looking for you for a handout. They do NOT understand or care about logic. Avoid registration, tie down agreements etc in CA at all costs. (yes, even a tie down agreement of any kind will generate a tax in CA.)
    Absolutely correct. 1. Keep all documentation and receipts. 2. Don’t fly to Cali until after 12 months after you bought the aircraft or call the Cali Tax board telling them your intentions so they don’t send you a bill, get it in writing.
    It doesn’t matter if it’s registered out of state, purchased out of state, or a Delaware corps. Once some snitch gets your N# (Podunck FBO owner in my case) on any ramp in CA. Expect a full on Tax bill.

    I bought an aircraft in California, I had so many days (3 I think)to get it out of there or they’d send me a Sales Tax Bill.
    Likes Poor Joe liked this post

  11. #11

    Join Date
    Jan 2016
    Posts
    67
    Post Thanks / Like
    A quick reference guide, but if you really want to get into the details, contact them.

    https://www.cdtfa.ca.gov/industry/ve...e.htm#Aircraft

  12. #12

    Join Date
    Feb 2015
    Location
    Anchorage
    Posts
    121
    Post Thanks / Like
    When we moved to Washington State the State offers new residents a one time tax free registration, after that you are paying King County for the privilege.

Similar Threads

  1. Avoiding the fine mess......
    By behindpropellers in forum Member to Member
    Replies: 57
    Last Post: 02-08-2011, 10:06 AM
  2. Hanger Space in Graham if avoiding Rita.
    By Steve Pierce in forum Cafe Supercub
    Replies: 10
    Last Post: 09-22-2005, 11:37 AM

Tags for this Thread

Bookmarks

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •