Keith Swirsky Weighs in on Recent IRS Guidance Regarding Imposition of Federal Excise Tax on Business Aircraft March 20, 2012 | Aviation International News
March 22, 2012
Keith Swirsky, President of GKG Law and Chair of the firm’s Business Aviation Group, was quoted in an Aviation International News article regarding a Chief Counsel Memorandum (CCM) released by the IRS, in which the IRS concluded that control of an aircraft’s pilots is a primary factor in determining which party has possession, command and control of an aircraft for purposes of imposing Transportation Excise Taxes under Internal Revenue Code Section 4261 (FET). Under the facts described in the CCM, the IRS determined that virtually all fees and reimbursements paid by the owner of an aircraft to its aircraft management company are subject to FET when the aircraft management company has primary control of the aircraft’s pilots. “I think there is going to be an evolution of thought process on this, but the pace of IRS audits of aircraft management companies has already accelerated and will continue to accelerate.” Mr. Swirsky said. He was joined by other industry experts in concluding that the CCM is indicative of the IRS’s overall stance with respect to imposition of the FET on private aircraft related fees and reimbursements.