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Old 08-25-2017, 10:40 AM
LEZ1675 LEZ1675 is offline
Bill Welter
 
Join Date: Feb 2010
Location: Colorado Springs, CO
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Default Uh-Oh, Here We Go - State Sales Tax

Just got a letter from Colorado Dept Of Revenue - "We just received word that you purchased an airplane and we need proof that you paid taxes on it".

So I called them up, explained that it's a homebuilt, and that I've been buying parts for 7 years, mostly mailorder. They want to see the receipts! I said no receipts, but I have a spreadsheet that shows every item that I purchased, so they want that.

I have a really bad feeling about this, more government BS

.
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Last edited by LEZ1675 : 08-25-2017 at 12:27 PM.
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  #2  
Old 08-25-2017, 04:36 PM
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TMann TMann is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Let's see .......
6 boxes of wing foam at $1.45 each ......
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  #3  
Old 08-30-2017, 11:18 AM
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Andrew Anunson Andrew Anunson is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

In Virginia:

If you purchase parts from an individual that doesn't sell parts often, its called occasional sale and you don't need to pay tax.

I bought my engine from a friend... it came off of his RV-9. I don't have to pay tax on the engine since its the only thing I bought from him and its the only engine he has sold.

I bought my canard from an individual that builds canards. I do need to pay tax on it because at the time he sold multiple canards.

ALSO,
we don't typically have to pay tax on shipping

ALSO,
Sales tax in Virginia is 4.5%. Aircraft sales and use tax is 2%. The state of VA charges 2% on items purchased to build a plane.

Your state may have similar rules.
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Old 08-30-2017, 06:41 PM
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jpolenek jpolenek is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Just tell them you can't release the information because it's "under audit".

Joe Polenek
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Old 08-30-2017, 08:10 PM
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TMann TMann is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Quote:
Originally Posted by jpolenek View Post
Just tell them you can't release the information because it's "under audit".

Joe Polenek
...... or that the funds will be available as soon as the "Affordable Airplane Act" is passed by Congress.
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  #6  
Old 08-31-2017, 10:51 AM
LEZ1675 LEZ1675 is offline
Bill Welter
 
Join Date: Feb 2010
Location: Colorado Springs, CO
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Or the "Aircraft Builder's Protection Act" !

Thanks, guys, for the info...
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Old 10-15-2017, 10:59 PM
ZG4Me ZG4Me is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Quote:
Originally Posted by LEZ1675 View Post
Just got a letter from Colorado Dept Of Revenue - "We just received word that you purchased an airplane and we need proof that you paid taxes on it".
...
.
I'm not a tax attorney, but did sleep in a Holiday Inn dumpster last night.

May be prudent to contact a tax attorney, a referral to one from your normal/regular attorney should be free/low cost.

But there's this snippet from the CO tax website:
AIRCRAFT PARTS
The sales and use tax exemption for aircraft parts applies to parts that are permanently affixed to the aircraft. This
includes, but is not limited to, fuselage parts, parts for the aircraft’s engine(s), seats permanently affixed to the
aircraft, and paint for the aircraft.

Last I checked, all our components are attached to the plane, therefore you only owe tax on the 'glue'

Rick
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  #8  
Old 10-16-2017, 12:31 AM
LEZ1675 LEZ1675 is offline
Bill Welter
 
Join Date: Feb 2010
Location: Colorado Springs, CO
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Thanks, Rick, but I believe that rule only applies to commercial aircraft.

But, I've heard of other people using that same info with success. I tallied up the spreadsheet I used when building, and I only spent $4000 for parts, labor, etc. in Colorado. And that was all spent to businesses that charged tax, so I think I'm good to go. But when dealing with the government, you never know. They have a lot of rules and regulations they have to go by.

Did they send you a similar letter when you finished your Cozy?

- Bill
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Last edited by LEZ1675 : 10-16-2017 at 09:50 AM.
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  #9  
Old 10-16-2017, 02:25 AM
ZG4Me ZG4Me is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Quote:
Originally Posted by LEZ1675 View Post
Thanks, Rick, but I believe that rule only applies to commercial aircraft.

But, I've heard of other people using that same info with success. I tallied up the spreadsheet I used when building, and I only spent $4000 for parts, labor, etc. in Colorado. And that was all spent to businesses that charged tax, so I think I'm good to go. But when dealing with the government, you never know.

Did they send you a similar letter when you finished your Cozy?

- Bill
Aircraft used for commercial purposes are exempt from state levied sales/use tax. So is any part permanently installed *in any* aircraft. Emphasis is mine. City/county tax is another story.

I'm still building. FAA deemed it airworthy, but it still needs years (at my speed) of work to fly correctly. Biggest issue is stall/spin, I can't get it to spin. I need to fix that.

Rick
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Build status: It flies! Airworthiness 10/7/2016.
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  #10  
Old 10-16-2017, 10:10 AM
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TMann TMann is offline
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Default Re: Uh-Oh, Here We Go - State Sales Tax

Quote:
Originally Posted by ZG4Me View Post
Biggest issue is stall/spin, I can't get it to spin. I need to fix that.

Rick
I am chuckling out load here Rick.
Very close to having coffee come out my nose (ouch!)
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