Skip to main content

Contact Information:
Edward S. Kisscorni, CPA
290 Suncrest Court, SW
Grandville, MI 49418

Office: 616/233-0667
Cell: 616/443-6730
Fax: 616/233-0667




Thursday, March 10 2011

Lessor's Use of Aircraft Did Not Prohibit Collection of Tax Based on Rental Receipts

In Lakeshore Leasing Ltd. v. Department of Treasury, Michigan Tax Tribunal, No. 361200, January 24, 2011, an owner-lessor who used its aircraft for pilot training and certification and did not collect any rental income until five months after the aircraft's purchase, properly made a Rule 82 election to collect Michigan use tax on rental receipts because its use of the aircraft was consistent with its business activity of leasing the aircraft to others.

The Tax Tribunal said it was reasonable that an owner-lessor would need to obtain training for the pilots and himself in the operation of a sophisticated aircraft as a necessary part of its leasing business.  Furthermore, Rule 82 does not require a lessor to immediately and completely surrender possession of an aircraft under lease or preclude a lessor from taking possession of its aircraft for purposes associated with its leasing business. Nothing in the documentary evidence supported the conclusion that the flights were for personal use.

Posted by: Ed Kisscorni AT 02:36 pm   |  Permalink   |  Email


Design Your Own Website, Today!
iBuilt Design Software
Give it a try for Free