AOPA Cardinal tax value?

[Mike Noel]

Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA
mag claims about 350K has been invested by various suppliers in the plane.
If the tax man thinks it is worth 350K, wouldn't someone need to shell out
nearly 100K in taxes to claim it?

--
Best Regards,
Mike

http://photoshow.comcast.net/mikenoel

[[email protected]]

Mike Noel > wrote:
> Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA
> mag claims about 350K has been invested by various suppliers in the plane.
> If the tax man thinks it is worth 350K, wouldn't someone need to shell out
> nearly 100K in taxes to claim it?

When you win something you're taxed at the fair market value.

For something new, that's usually the retail price.

For something like the AOPA Cardinal, it is the going price for a
restored Cardinal.

If I won it, the first thing I'd do is go get 3 professional appraisals,
throw away the highest, and send the IRS (and State in my case) the
tax on the average.

A quick look at controller.com shows Cardinals with new paint and
interior going for around $80k, so I doubt the market value of
the AOPA Cardinal is anywhere near $350k.

You can never recover the full cost of "improvements" on an airplane
when it is sold.


--
Jim Pennino

Remove .spam.sux to reply.

[Vaughn Simon]

"Mike Noel" > wrote in message
. ..
> Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA mag
> claims about 350K has been invested by various suppliers in the plane. If the
> tax man thinks it is worth 350K, wouldn't someone need to shell out nearly
> 100K in taxes to claim it?

That is why many of those planes are immediately sold by the winners. That
said, the investment in the plane probably does not determine its tax value any
more than your investment in your own plane determines its market value. For
example: If I took a bummed-out C-150 and lavished $150,000 on it, what could I
sell it for? (Hint: somewhere near the top of the market for a C-150, but
something far less than $150,000)

My guess is that the tax value would more likely be based on a likely selling
price. Vref would probably be a good starting point.

Vaughn

[Robert M. Gary]

On Nov 22, 11:25 am, wrote:
> Mike Noel > wrote:
> > Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA
> > mag claims about 350K has been invested by various suppliers in the plane.
> > If the tax man thinks it is worth 350K, wouldn't someone need to shell out
> > nearly 100K in taxes to claim it?
>
> When you win something you're taxed at the fair market value.
>
> For something new, that's usually the retail price.
>
> For something like the AOPA Cardinal, it is the going price for a
> restored Cardinal.
>
> If I won it, the first thing I'd do is go get 3 professional appraisals,
> throw away the highest, and send the IRS (and State in my case) the
> tax on the average.

AOPA is also required to supply the value to the IRS. They always low
ball it. If you want to challenge it you'll need to do that formally
with the IRS. Whenever large prizes like this are awarded the IRS is
involved.

-Robert

[Kyle Boatright]

"Mike Noel" > wrote in message
. ..
> Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA
> mag claims about 350K has been invested by various suppliers in the plane.
> If the tax man thinks it is worth 350K, wouldn't someone need to shell out
> nearly 100K in taxes to claim it?
>
> --
> Best Regards,
> Mike
>
> http://photoshow.comcast.net/mikenoel

While the aircraft is certainly spruced up, the "investment" on the part of
most of the suppliers is essentially in an advertising expense which gets
their shop's or product's name in the magazine repeatedly.

Win the airplane and you'll get taxed on a basis which is equivalent to or
slightly above the price of the nicest Cardinal(s) currently trading hands.

My guess is that the world's nicest Cardinal is worth $100k - $125k, which
probably means taxes of between $30k and $40k. Not a bad price to pay for a
very nice airplane.

KB

[[email protected]]

Robert M. Gary > wrote:
> On Nov 22, 11:25 am, wrote:
> > Mike Noel > wrote:
> > > Any idea what the tax value will be on the AOPA Cardinal? The latest AOPA
> > > mag claims about 350K has been invested by various suppliers in the plane.
> > > If the tax man thinks it is worth 350K, wouldn't someone need to shell out
> > > nearly 100K in taxes to claim it?
> >
> > When you win something you're taxed at the fair market value.
> >
> > For something new, that's usually the retail price.
> >
> > For something like the AOPA Cardinal, it is the going price for a
> > restored Cardinal.
> >
> > If I won it, the first thing I'd do is go get 3 professional appraisals,
> > throw away the highest, and send the IRS (and State in my case) the
> > tax on the average.

> AOPA is also required to supply the value to the IRS. They always low
> ball it. If you want to challenge it you'll need to do that formally
> with the IRS. Whenever large prizes like this are awarded the IRS is
> involved.

What do you think the professional appraisal would be for?

If the AOPA value was less than the appraisal, what do you imagine
I would do with the appraisal?

The IRS wants tax on winnings, no ****?

--
Jim Pennino

Remove .spam.sux to reply.

[news.chi.sbcglobal.net]

I saw a presentation by Julie K. Boatman of the AOPA at the Garmin store in
Chicago, and she addressed this issue.

IIRC, she said there is one value, which is the sum of the parts of the
airplane.

Then there is another, which is what the airplane might sell for.

Finally, there is a valuation that the IRS will accept for tax purposes. And
it is quite a bit lower than the other two valuations...


> wrote in message
...
> Robert M. Gary > wrote:
>> On Nov 22, 11:25 am, wrote:
>> > Mike Noel > wrote:
>> > > Any idea what the tax value will be on the AOPA Cardinal? The latest
>> > > AOPA
>> > > mag claims about 350K has been invested by various suppliers in the
>> > > plane.
>> > > If the tax man thinks it is worth 350K, wouldn't someone need to
>> > > shell out
>> > > nearly 100K in taxes to claim it?
>> >
>> > When you win something you're taxed at the fair market value.
>> >
>> > For something new, that's usually the retail price.
>> >
>> > For something like the AOPA Cardinal, it is the going price for a
>> > restored Cardinal.
>> >
>> > If I won it, the first thing I'd do is go get 3 professional
>> > appraisals,
>> > throw away the highest, and send the IRS (and State in my case) the
>> > tax on the average.
>
>> AOPA is also required to supply the value to the IRS. They always low
>> ball it. If you want to challenge it you'll need to do that formally
>> with the IRS. Whenever large prizes like this are awarded the IRS is
>> involved.
>
> What do you think the professional appraisal would be for?
>
> If the AOPA value was less than the appraisal, what do you imagine
> I would do with the appraisal?
>
> The IRS wants tax on winnings, no ****?
>
> --
> Jim Pennino
>
> Remove .spam.sux to reply.

[Robert M. Gary]

On Nov 22, 1:05 pm, wrote:

> > > If I won it, the first thing I'd do is go get 3 professional appraisals,
> > > throw away the highest, and send the IRS (and State in my case) the
> > > tax on the average.
> > AOPA is also required to supply the value to the IRS. They always low
> > ball it. If you want to challenge it you'll need to do that formally
> > with the IRS. Whenever large prizes like this are awarded the IRS is
> > involved.
>
> What do you think the professional appraisal would be for?
>
> If the AOPA value was less than the appraisal, what do you imagine
> I would do with the appraisal?

Sucks when the coffee pot runs dry.

-Robert

[B A R R Y]

On Thu, 22 Nov 2007 14:55:04 -0500, "Kyle Boatright"
> wrote:

>>
>My guess is that the world's nicest Cardinal is worth $100k - $125k, which
>probably means taxes of between $30k and $40k. Not a bad price to pay for a
>very nice airplane.

You got that right!

[Matt Whiting]

news.chi.sbcglobal.net wrote:
> I saw a presentation by Julie K. Boatman of the AOPA at the Garmin store
> in Chicago, and she addressed this issue.
>
> IIRC, she said there is one value, which is the sum of the parts of the
> airplane.
>
> Then there is another, which is what the airplane might sell for.
>
> Finally, there is a valuation that the IRS will accept for tax purposes.
> And it is quite a bit lower than the other two valuations...

I'd be curious to know more about that last statement as it doesn't
sound correct to me. I haven't refreshed my memory yet on the tax laws
as tax season is still a couple of months away, but I haven't heard of
any regulation that allows you to use less than "fair market value" for
tax valuation purposes. And that sounds like the second value above,
not the third.

Any tax gurus here know if what she is quoted as saying is legit?

Matt

[Dallas]

On Thu, 22 Nov 2007 11:26:04 -0700, Mike Noel wrote:

> The latest AOPA mag claims about 350K has been invested

I applaud AOPA's effort to restore old aircraft and all that, but
considering that the base price of a new SR22 is $371,200, does it really
make sense to plow $350,000 into an old airframe?


--
Dallas

[Vaughn Simon]

"Dallas" > wrote in message
. ..
>
> I applaud AOPA's effort to restore old aircraft and all that, but
> considering that the base price of a new SR22 is $371,200, does it really
> make sense to plow $350,000 into an old airframe?

I seems to work for AOPA and that is all that really matters isn't it? It is
good advertising for the companies who donate materials and services, and AOPA
apparently makes enough on the raffle sales to make it worth their while. As a
nice little plus, they get some fair magazine articles out of the deal.

Would it make sense for YOU to plow $350,00 into that same airframe? Of
course not!

Vaughn

[[email protected]]

http://www.aopa.org/sweeps/officialrules.html
WHAT CAN I WIN? One (1) Grand Prize. One (1) Grand Prize winner will receive
a restored Cessna Cardinal 177B Aircraft. Winner does not have choice of any
options, exterior or interior colors. Approximate retail value ("ARV"):
$105,000.

[Bob Noel]

In article >,
Dallas > wrote:

> On Thu, 22 Nov 2007 11:26:04 -0700, Mike Noel wrote:
>
> > The latest AOPA mag claims about 350K has been invested
>
> I applaud AOPA's effort to restore old aircraft and all that, but
> considering that the base price of a new SR22 is $371,200, does it really
> make sense to plow $350,000 into an old airframe?

Probably not, but I'd rather have an old cardinal than a new SR22.
I really don't like the sidestick.

--
Bob Noel
(goodness, please trim replies!!!)

[Ted[_2_]]

And anyone that has taken a look-see at the AOPA Cardinal will realize that
THIS Cardinal is no-doubt THE FINEST!! IMHO


"Kyle Boatright" > wrote in message
...
>
> "Mike Noel" > wrote in message
> . ..
>> Any idea what the tax value will be on the AOPA Cardinal? The latest
>> AOPA mag claims about 350K has been invested by various suppliers in the
>> plane. If the tax man thinks it is worth 350K, wouldn't someone need to
>> shell out nearly 100K in taxes to claim it?
>>
>> --
>> Best Regards,
>> Mike
>>
>> http://photoshow.comcast.net/mikenoel
>
> While the aircraft is certainly spruced up, the "investment" on the part
> of most of the suppliers is essentially in an advertising expense which
> gets their shop's or product's name in the magazine repeatedly.
>
> Win the airplane and you'll get taxed on a basis which is equivalent to or
> slightly above the price of the nicest Cardinal(s) currently trading
> hands.
>
> My guess is that the world's nicest Cardinal is worth $100k - $125k, which
> probably means taxes of between $30k and $40k. Not a bad price to pay for
> a very nice airplane.
>
> KB
>

[Ted[_2_]]

Raffle?? What Raffle??


"Vaughn Simon" > wrote in message
...
>
> "Dallas" > wrote in message
> . ..
>>
>> I applaud AOPA's effort to restore old aircraft and all that, but
>> considering that the base price of a new SR22 is $371,200, does it really
>> make sense to plow $350,000 into an old airframe?
>
> I seems to work for AOPA and that is all that really matters isn't it?
> It is good advertising for the companies who donate materials and
> services, and AOPA apparently makes enough on the raffle sales to make it
> worth their while. As a nice little plus, they get some fair magazine
> articles out of the deal.
>
> Would it make sense for YOU to plow $350,00 into that same airframe?
> Of course not!
>
> Vaughn
>
>

[B A R R Y]

On Fri, 23 Nov 2007 16:15:03 -0800, "Ted" <TBBlakeley@comcastDOTnet>
wrote:

>And anyone that has taken a look-see at the AOPA Cardinal will realize that
>THIS Cardinal is no-doubt THE FINEST!! IMHO
>

I saw and sat in it in Hartford, and I'd have to agree.

[Dan Luke[_2_]]

"Kyle Boatright" wrote:

> My guess is that the world's nicest Cardinal is worth $100k - $125k,

I bet it would sell for the high end of that, maybe a bit more because of the
advertising it's gotten during the refurb. process.

Anybody know what any previous AOPA sweepstakes airplanes have sold for?

--
Dan
T-182T at BFM

[Robert M. Gary]

On Nov 23, 5:18 am, Matt Whiting > wrote:

> Any tax gurus here know if what she is quoted as saying is legit?

Not a tax guru but I do know that its not the winner's responsibility
to determine the fair value of the prize. AOPA is required to do so. I
spoke to AOPA about this before and they said they have accountants
that come up with the most favorable value for the winner as possible.
Remember that although they may have put $300,000 into the plane, its
unlikely that more than 1/2 of that would ever come back.

-Robert

[Matt Whiting]

Robert M. Gary wrote:
> On Nov 23, 5:18 am, Matt Whiting > wrote:
>
>> Any tax gurus here know if what she is quoted as saying is legit?
>
> Not a tax guru but I do know that its not the winner's responsibility
> to determine the fair value of the prize. AOPA is required to do so. I
> spoke to AOPA about this before and they said they have accountants
> that come up with the most favorable value for the winner as possible.
> Remember that although they may have put $300,000 into the plane, its
> unlikely that more than 1/2 of that would ever come back.

Yes, but can AOPA get away with providing a value that is less than FMV?

Matt

[Robert M. Gary]

On Nov 25, 7:32 pm, Matt Whiting > wrote:
> Robert M. Gary wrote:

> Yes, but can AOPA get away with providing a value that is less than FMV?

There really is no basis for FMV for such a unique object. If there
were 1000's of AOPA Cardinals it would be pretty straight forward to
figure a value. However, since this is a very unique item accountants
must use some judgement. Certainly the value is no where near the
value of everything in the plane because no one would pay for such a
White Elephant.

-Robert

[Newps]

Robert M. Gary wrote:

> On Nov 25, 7:32 pm, Matt Whiting > wrote:
>
>>Robert M. Gary wrote:
>
>
>>Yes, but can AOPA get away with providing a value that is less than FMV?
>
>
> There really is no basis for FMV for such a unique object. If there
> were 1000's of AOPA Cardinals it would be pretty straight forward to
> figure a value. However, since this is a very unique item accountants
> must use some judgement. Certainly the value is no where near the
> value of everything in the plane because no one would pay for such a
> White Elephant.


And as such as soon as you sell it you have set fair market value.

[Robert M. Gary]

On Nov 25, 8:29 pm, Newps > wrote:
> Robert M. Gary wrote:
> > On Nov 25, 7:32 pm, Matt Whiting > wrote:
>
> >>Robert M. Gary wrote:
>
> >>Yes, but can AOPA get away with providing a value that is less than FMV?
>
> > There really is no basis for FMV for such a unique object. If there
> > were 1000's of AOPA Cardinals it would be pretty straight forward to
> > figure a value. However, since this is a very unique item accountants
> > must use some judgement. Certainly the value is no where near the
> > value of everything in the plane because no one would pay for such a
> > White Elephant.
>
> And as such as soon as you sell it you have set fair market value.

And would then owe income tax on the difference.

-Robert

[Gig 601XL Builder]

Dallas wrote:
> On Thu, 22 Nov 2007 11:26:04 -0700, Mike Noel wrote:
>
>> The latest AOPA mag claims about 350K has been invested
>
> I applaud AOPA's effort to restore old aircraft and all that, but
> considering that the base price of a new SR22 is $371,200, does it
> really make sense to plow $350,000 into an old airframe?

Unless Cirus is going to give them a sub cost price yes it does. A lot of
that stuff is given to AOPA and/or provided at reduced cost.

[Newps]

Robert M. Gary wrote:

>>
>>And as such as soon as you sell it you have set fair market value.
>
>
> And would then owe income tax on the difference.
>
> -Robert


AOPA says plane will have a FMV of $135K I believe someone said. If I
win and put it up for sale but can only get $100K then that's the value
as far as the IRS is concerned. Only if you keep it does the $135K have
any bearing.

[Matt Whiting]

Newps wrote:
>
>
> Robert M. Gary wrote:
>
>>>
>>> And as such as soon as you sell it you have set fair market value.
>>
>>
>> And would then owe income tax on the difference.
>>
>> -Robert
>
>
> AOPA says plane will have a FMV of $135K I believe someone said. If I
> win and put it up for sale but can only get $100K then that's the value
> as far as the IRS is concerned. Only if you keep it does the $135K have
> any bearing.

Better sell it in the same tax year as you win it then!

Matt

[Newps]

Matt Whiting wrote:


>>
>> AOPA says plane will have a FMV of $135K I believe someone said. If I
>> win and put it up for sale but can only get $100K then that's the
>> value as far as the IRS is concerned. Only if you keep it does the
>> $135K have any bearing.
>
>
> Better sell it in the same tax year as you win it then!


Yep, that's why they give it away in January.