Firm Releases New Year’s Resolutions for Aircraft Purchasers
Aero & Marine Tax Professionals Releases Resolutions That Will Help Aircraft Purchasers Avoid Sales Tax
Sacramento, CA: AERO&MARINE Tax Professionals, (http://aeromarinetaxpros.com/), a consulting firm that helps purchasers of aircraft and vessels avoid paying sales tax in California and Arizona, has released a list of New Year’s resolutions for purchasers of aircraft and vessels to save them money in 2008. Their proposed resolutions include:
1. I resolve to better understand how the burden of proof works for tax exemption, knowing that the common misconception is that if the purchaser in an aircraft sale takes actions, such as taking delivery of the aircraft out-of-state, they believe that their transaction is exempt from tax and they do not have to do anything further.
2. I resolve to understand that the actual situation in California is that the person involved in an aircraft purchase must file a tax return in a timely manner and receive a letter from the California State Board of Equalization stating that they have supported their claim for an exemption. If the purchaser doesn’t do this, the California State Board of Equalization has up to 9 years to notify him that he owes the tax. And they can also assess interest and penalties which can nearly double the amount of tax owed.
3. I resolve that when I purchase an aircraft or vessel from someone other than a retailer who collects sales tax from me at the time of the transaction, I will file a tax return, within twelve months from the date of the transaction.
4. I resolve to remember that if I receive an inquiry letter from the Board of Equalization, the due date is located in the top right hand section of the cover letter, and I will file a tax return by that date.
5. I resolve to remember that my aircraft purchase is NOT EXEMPT FROM TAX until I have filed a tax return and received written notification from the Board that I have supported a claim for exemption.
6. I resolve to remember that even if I made my purchase 5-6 years ago, my transaction is not exempt if I do not possess a letter from the Board which affirms I have supported my claim for exemption. I will not be lulled to sleep by the fact that I have not been contacted by the Board. They know they have approximately nine years after my transaction to legally notify me that I have been assessed tax.
7. I resolve to remember that if the Board waits nearly nine years after my purchase and then contacts me and assesses the tax, that the penalties and interest could nearly double my tax.
Thomas Alston, President of Aero & Marine Tax Professionals stated, “At this time of year it is typical for people to make decisions on things they want to improve in the coming year. If you are planning to purchase an aircraft or vessel in the coming year, it is vital for you to remember the fact that the burden of proof in supporting a claim for an exemption rests squarely on your shoulders. The Board does not have to prove anything. The taxpayer has to support the claim for a sales tax exemption and must file a tax return. In general, the return is due within twelve months from the date of the transaction. Just because you know that your property was used in an exempt manner does not mean that it is exempt. You must have in your possession a document from the Board which affirms they agree you have supported your claim. Even if you made your purchase 5-6 years ago, your transaction is not exempt if you do not possess a letter from the Board which affirms you have supported your claim for exemption. Imagine getting a notice seven years and eleven months after the tax return due date. You will not only be assessed tax but penalties and interest as well. This will easily double the amount you originally owed. Now imagine that your records were destroyed because someone in your company thought there was no exposure. You would have no recourse, and would end up having to pay the tax.”
Thomas Alston is the President of Aero & Marine Tax Professionals, the pre-eminent experts in California and Arizona sales tax involving airplanes, vehicles or vessels. The company shows purchasers how to avoid sales tax and to make certain the full value of your next aircraft, vehicle or vessel goes into their pocket–not the Government’s. He has successfully filed hundreds of tax returns on behalf of clients with the California State Board of Equalization.