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Cessna 210 Lease or Flight Club?
I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice.
I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. |
#2
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Cessna 210 Lease or Flight Club?
On Mar 16, 1:05*pm, tatermunk
wrote: I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice. I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. I wouldn't touch that with a 10 foot pole without consulting with an aviation attorney. If you are an AOPA legal plan member, you can get a referral to one and a few hours for free (I forget how many). It would be a wise precaution. |
#3
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Cessna 210 Lease or Flight Club?
On Mon, 16 Mar 2009 17:05:04 +0000, tatermunk wrote:
I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice. I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. Not as long as you disclose. -- I'm unfaithful, divorced, lost my kids, bankrupt and remarried a slant-eyed karate instructor. You, however, can call me DOCTOR McIntire! Come Poke Me! http://preview.tinyurl.com/2wqmqf |
#4
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Cessna 210 Lease or Flight Club?
On Mon, 16 Mar 2009 17:05:04 +0000, tatermunk wrote:
I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice. I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. When you move into a profit-making venture, and you distribute profits to Member(s) (you), you will be viewed, in case somwething happens, legally not as a club of folks sharing expenses but as a business with the concurrent liabilities to your "public" (members). If you retain profits in a reserve, ultimately you will have to spend or distribute them (up to some amount can be retained and some length of time depending on your corporate structure) but you will be functioning more like a true club. An LLC? A Sub S? A Sub C? -- Dr. Robert Bear, MD, FRCPC, (ex Vice Dean, Not James) American Board of Internal Medicine & Nephrology Certification Clinical trials, renal soiling, DEPENDS research, Dialysis population, no boners research Euthanasia Certified; Uncontrolled ****ing Expert Telephone 780-407-7239; Fax 780-407-7771 |
#5
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Cessna 210 Lease or Flight Club?
On Mon, 16 Mar 2009 17:05:04 +0000, tatermunk wrote:
I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice. I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. Are you leasing the plane with the LLC as the Lessee? Are you Subleasing the plane as Sublessor? Fer Chrissakes d00d, we are not crystal ball gazers!!!!!!!! -- 621 NW 53RD ST - STE 240; Boca Raton, FL. 33487 GUARANTEEED!! We finance *anyone* 110% !!! http://tr.im/1f9g "The trick is in tricking the Lender; we're the best !! " {C} 954-242-5638; {P} 561-995-1469 x 322; {F} 561-995-1489 |
#6
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Cessna 210 Lease or Flight Club?
On Mon, 16 Mar 2009 17:05:04 +0000, tatermunk wrote:
I have a question about some of the legalities of what I am in the process of doing. If anyone can point me in the right direction I welcome and appreciate all opinions and advice. I am in the process of purchasing a Cessna 210. I have 3 signed 1 year lease agreements with pilots in my area. I have a $1200 deposit from each pilot and when I reach 6 pilots I will purchase the aircraft. They agree to $600 per month for a year for 10hrs per month. Any hours flown over the 10hr allowance will be an additional $60 per hr. Insurance, Maintenance, Hanger, etc. are all included. For me, that covers the cost of the plane, hanger, insurance, and a hefty maintenance reserve. However, I will/can still make a profit depending on how I structure the maintenance reserve. Is there any problem with the way I am structuring this? And other than paying taxes and making sure my insurance is covered correctly... Is there any problems with making a profit from this? Thanks to anyone who can help. How the **** are we supposed to know you gave **** for info, CommoSuck. |
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I hope that helps. Thanks |
#9
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Thank you for your response, it was one of the most enlightening. It seems that once I accept or structure this to retain a profit I assume commercial liabilities as well. Which is understood and definitely has moved me to clearly explaining this to my insurance agent (again) to insure the appropriate coverage. Another question this brings up. If I were to structure this not to retain a profit, only to cover costs, maintenance reserves and upgrades etc.; What happens when I sell the aircraft and there is a profit? I assume capital gains applies? Well, I know that applies in a for profit situation, but this I am not sure? As far as company structure I think an LLC would make the most sense, but I am still researching which works best for this situation. I appreciate anymore information you may have regarding what we've discussed. Best Regards! |
#10
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Thank you, good advice and I will follow it. |
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