Government Urges Court to Affirm Tax on Fractional Aircraft Fees

A federal district court properly held a 7.5% excise tax should be charged to certain fees paid by customers of an Ohio-based fractional aircraft ownership firm and is on the hook for more than $24 million in unpaid taxes plus accrued interest, the government recently told the Sixth Circuit.

Flight Options LLC is subject to the tax established under IRC Section 4261, which is imposed on fees, fuel surcharges, and other costs associated with taxable transportation—or air travel, the government said Jan. 21 in its reply brief filed with the US Court of Appeals for the Sixth Circuit.

The ...