Sales Tax and Delivery

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and have it
delivered by the dealer to Oregon. There it will stay for 91 days and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and have it
delivered to Oregon, in what state does my ownership begin?" The tax law is
clear that as soon as I bring the aircraft into California, then I may be
subject to use tax. So, is it my aircraft when I make the purchase in
California, or when I receive the aircraft in Oregon?

r.

On Tue, 02 Mar 2004 18:52:04 GMT, "Rob Thomas"
wrote:

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and have it
delivered by the dealer to Oregon. There it will stay for 91 days and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and have it
delivered to Oregon, in what state does my ownership begin?" The tax law is
clear that as soon as I bring the aircraft into California, then I may be
subject to use tax. So, is it my aircraft when I make the purchase in
California, or when I receive the aircraft in Oregon?

Save yourself some grief and ask the county assessor beforehand. I
don't expect you'll like what you hear, but then you'll have something
explicit to discuss with your lawyer before you make the purchase.

Don

Agreed Don. I was just wondering if anyone in the group had done this
before. It would be easier if I could look for an aircraft around my area
and have it delivered to Oregon, but if this is going to cause problems, I
can just start looking out-of-state to begin with.

Just curious to see if anyone else on the group had done this before. In
reading some past posts, it looks like the contract must also be executed
outside of California as well.

r.

"Don Tuite" wrote in message
...
On Tue, 02 Mar 2004 18:52:04 GMT, "Rob Thomas"
wrote:

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and have
it
delivered by the dealer to Oregon. There it will stay for 91 days and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and have it
delivered to Oregon, in what state does my ownership begin?" The tax law
is
clear that as soon as I bring the aircraft into California, then I may be
subject to use tax. So, is it my aircraft when I make the purchase in
California, or when I receive the aircraft in Oregon?

Save yourself some grief and ask the county assessor beforehand. I
don't expect you'll like what you hear, but then you'll have something
explicit to discuss with your lawyer before you make the purchase.

Don

If you look in the archives you will see this subject flogged
repeatedly. The biggest issue is how to prove the aircraft was outside
California---hangar bills, fuel receipts, etc. all help your situation.

But if you are going to be 3 months without your shiny new toy anyway,
why not use it as an opportunity? Buy a great plane with a run-out
engine and overhaul out of state. It's not quite the same as having the
state pay for part of your overhaul, but the net result is similar.

Actually, this specific question has not been flogged. My question is can
you purchase an aircraft in California, have it delivered by the broker to
Oregon, and 91 days later bring it back into California without sales/use
tax being levied? My issue surrounds the fact that the aircraft is already
in the state that I want to eventually bring it back into.

In reading some material, I believe I have found the answer:

"(b) Shipments Outside the State--When Sales Tax Does Not Apply. Sales tax
does not apply when the property pursuant to the contact of sale, is
required to be shipped and is shipped to a point outside this state by the
retailer, by means of:

1. Facilities operated by the retailer or

2. ..."

So, my understanding is that as long as the broker actually does the
delivery outside of California, then I'm clear of the sales tax. Then just
need to keep it outside the state for 90 days and fly it every so often then
I'm clear of the use tax.

Of course, I'll be talking to a tax advisor on this, but wanted some input
from all the great folks on the group.

I really like your idea about overhauling out of state. Very creative!
Thanks!

r.



wrote in message
...
If you look in the archives you will see this subject flogged
repeatedly. The biggest issue is how to prove the aircraft was outside
California---hangar bills, fuel receipts, etc. all help your situation.

But if you are going to be 3 months without your shiny new toy anyway,
why not use it as an opportunity? Buy a great plane with a run-out
engine and overhaul out of state. It's not quite the same as having the
state pay for part of your overhaul, but the net result is similar.

AH, I didn't realize the plane you wanted was already in California.

If you are a state resident and you buy a plane in the same state, they
will levy the use tax, even if you decide to keep it on the moon for 91
days. At least that's how it was explained to me. (I also bought a
plane in CA while living here.)

If you wanted to get sneaky you could have a friend in Oregon or Nevada
buy the plane for you, I guess. Remember to make sure you would
actually save money doing all this---when I calculated the costs of
keeping the plane at a remote airport and going to visit it
occasionally, the benefits lost their appeal rather quickly. But then
my plane wasn't that expensive.


Rob Thomas wrote:
Actually, this specific question has not been flogged. My question is can
you purchase an aircraft in California, have it delivered by the broker to
Oregon, and 91 days later bring it back into California without sales/use

"Rob Thomas" writes:


"(b) Shipments Outside the State--When Sales Tax Does Not Apply. Sales tax
does not apply when the property pursuant to the contact of sale, is
required to be shipped and is shipped to a point outside this state by the
retailer, by means of:

........


Note that Big Iron is routinely "purchased" in-flight, over
International Waters. Care to guess why? Yep!

--
A host is a host from coast to
& no one will talk to a host that's close........[v].(301) 56-LINUX
Unless the host (that isn't close).........................pob 1433
is busy, hung or dead....................................20915-1433

CA is perhaps different from other states. Rhode Island will whack you with
either a sales tax or a use tax when you bring the airplane into the state as a
state resident regardless of when you purchased the airplane.

Rob Thomas wrote:

Agreed Don. I was just wondering if anyone in the group had done this
before. It would be easier if I could look for an aircraft around my area
and have it delivered to Oregon, but if this is going to cause problems, I
can just start looking out-of-state to begin with.

Just curious to see if anyone else on the group had done this before. In
reading some past posts, it looks like the contract must also be executed
outside of California as well.

r.

"Don Tuite" wrote in message
...
On Tue, 02 Mar 2004 18:52:04 GMT, "Rob Thomas"
wrote:

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and have
it
delivered by the dealer to Oregon. There it will stay for 91 days and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and have it
delivered to Oregon, in what state does my ownership begin?" The tax law
is
clear that as soon as I bring the aircraft into California, then I may be
subject to use tax. So, is it my aircraft when I make the purchase in
California, or when I receive the aircraft in Oregon?

Save yourself some grief and ask the county assessor beforehand. I
don't expect you'll like what you hear, but then you'll have something
explicit to discuss with your lawyer before you make the purchase.

Don

--
--Ray Andraka, P.E.
President, the Andraka Consulting Group, Inc.
401/884-7930 Fax 401/884-7950
email
http://www.andraka.com

"They that give up essential liberty to obtain a little
temporary safety deserve neither liberty nor safety."
-Benjamin Franklin, 1759

If you keep the aircraft out of state for 91 days after purchase, then there
is no use tax in California. You do have to actually use the aircraft
during the 91 days, it just can't be kept in storage.

r.

"Ray Andraka" wrote in message
...
CA is perhaps different from other states. Rhode Island will whack you
with
either a sales tax or a use tax when you bring the airplane into the state
as a
state resident regardless of when you purchased the airplane.

Rob Thomas wrote:

Agreed Don. I was just wondering if anyone in the group had done this
before. It would be easier if I could look for an aircraft around my
area
and have it delivered to Oregon, but if this is going to cause problems,
I
can just start looking out-of-state to begin with.

Just curious to see if anyone else on the group had done this before.
In
reading some past posts, it looks like the contract must also be
executed
outside of California as well.

r.

"Don Tuite" wrote in message
...
On Tue, 02 Mar 2004 18:52:04 GMT, "Rob Thomas"
wrote:

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and
have
it
delivered by the dealer to Oregon. There it will stay for 91 days
and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and
have it
delivered to Oregon, in what state does my ownership begin?" The tax
law
is
clear that as soon as I bring the aircraft into California, then I
may be
subject to use tax. So, is it my aircraft when I make the purchase
in
California, or when I receive the aircraft in Oregon?

Save yourself some grief and ask the county assessor beforehand. I
don't expect you'll like what you hear, but then you'll have something
explicit to discuss with your lawyer before you make the purchase.

Don

--
--Ray Andraka, P.E.
President, the Andraka Consulting Group, Inc.
401/884-7930 Fax 401/884-7950
email
http://www.andraka.com

"They that give up essential liberty to obtain a little
temporary safety deserve neither liberty nor safety."
-Benjamin Franklin, 1759

On 3/2/04 10:52 AM, in article ,
"Rob Thomas" wrote:

I'm curious if anyone has ever done this:

Purchase a used aircraft in California (my state of residency) and have it
delivered by the dealer to Oregon. There it will stay for 91 days and be
flown on occasion, then brought back down into California.

My real question here is "if I buy the aircraft in California and have it
delivered to Oregon, in what state does my ownership begin?" The tax law is
clear that as soon as I bring the aircraft into California, then I may be
subject to use tax. So, is it my aircraft when I make the purchase in
California, or when I receive the aircraft in Oregon?

r.



I bought an aircraft about a year and a half ago. I live in Eureka, so
keeping it in Oregon was easy. I was successful in obtaining a sales tax
waiver. There is really no need to go to a professional; all you need to do
is keep records. There are some things I kept in mind:

* Do NOT go for the straight 90-day exemption. Go for the 90-days-out-of-180
exemption, and stay out for 120 days to cover all bases. This prevents the
tax board from disqualifying you because of some single day on a whim. If
you apply for the straight exemption, the tax board will examine your log
books and say, "We think you *overflew* California during this here flight.
Sorry."

* Keep PERFECT records of where the aircraft was located on EVERY DAY for
six months following the purchase, and actually keep the airplane out of
state. Make sure people see your airplane there too. The tax board
telephoned every airport at which I claimed to keep the airplane for more
than a single night to confirm that I actually had kept the airplane there.

* I believe that a CA resident cannot purchase an aircraft currently
registered inside the state and be exempt here. I phoned the tax board to
ask about this one, but I forget the exact response. But I do remember
throwing out consideration of California-based airplanes after that
conversation.

* Go on a nice coast-to-coast cross country trip during the exemption
period. You don't get the exemption if you don't make significant
out-of-state use of the airplane.

* After the 120 days is up, apply for the exemption before the tax board has
a chance to send you a tax return.

Good Luck!