Tax bill of $26,000 for flying into US state of Maine?

Peter Clark wrote:
This story has been going on for a while, somewhere I read that they
had someone sending out bills based on IFR flight plans they pulled
from a tracking service.

If that's the case then how do they even know how long a plane is there? If
you fly in on the 1st of the month IFR, out on the 2nd VFR and then fly back
19th VFR and then out on the 21st IFR, the tracking services will make it
look like you have been there 20 days.

On Fri, 7 Dec 2007 08:21:13 -0600, "Gig 601XL Builder"
wrDOTgiaconaATsuddenlink.net wrote:

Peter Clark wrote:
This story has been going on for a while, somewhere I read that they
had someone sending out bills based on IFR flight plans they pulled
from a tracking service.

If that's the case then how do they even know how long a plane is there? If
you fly in on the 1st of the month IFR, out on the 2nd VFR and then fly back
19th VFR and then out on the 21st IFR, the tracking services will make it
look like you have been there 20 days.

I didn't say what they were doing made any sort of logical sense...

I base my aircraft in MA. I do all my maintenance at PWM. Does my
flying there more than 20 times a year on daytrips to pay them money
to fix my aircraft (and pay sales tax on those parts and repairs) also
expose me to the use tax? The whole thing is just stupid for anyone
who's not a bona-fide resident of the state. Just like those people
who live in MA and register their cars in NH to avoid MA taxes. Get
caught, pay up. It's not hard for an investigator to figure out
whether you're really living there or not. And I always thought
residency was based on 181 days/year, but what do I know.

On Dec 6, 11:44 am, "Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net
wrote:
\
Use tax in and of itself is perfectly understandable. Let's say I order all
of my copy paper from XYZ company out of state and XYZ doesn't have a
presence in the state I end up not paying sales tax that I would have paid
if I went to Office Depot down the street and bought it. Hence the Use tax.

I don't personally believe that the constitution's rule on interstate
commerce allows for use tax. However, the courts have ruled that use
tax is permitted under certain situations. One is that the use tax is
the same as the in-state tax (sales tax), the other is timeliness,
which is originally why California exempted aircraft from use tax if
they are kept out of state for 3 months.

-robert

"Mike Isaksen" wrote in message ...

"Tri-Pacer" ...
Anyone else read the latest story in today's AvWebFlash's email
newsletter
about the Massachusetts based pilot who flew his Cirrus several times
into
Maine and unexpectedly received a Maine "use tax" bill of over $26,000?


The article mentioned that the chap had a Summer home in Maine. Perhaps
they consider him a resident since he owns property and spends time
there.

Bummer no matter what the reason.

I own vacation property in two other states, but they won't let me vote
(state, local or school tax). I wonder if Maine lets him vote. Also, the
20 day number sounds very short. Anyone know the typical time period for
other States?

The Use Tax issue is very common in any state that has high Sales Taxes,
and the state governments can get pretty aggressive (NY being one). NY
does periodic walkdowns at most airports and reviews tenant & transient
records. The only upside is NY fully credits sales/use tax paid in other
states on the item in question. Someone mentioned there is also a "used
and useful" provision that won't let the Tax apply to used items brought
into the State?!?


I always say the devil is in the details, and no less with this issue. The
first year clause is typical of determining if it's new, but the 20 days
still seems a bit presumptuous and usury.

Here's a follow-up to the above, as posted on the Van's AirForce site by
Doug R:

36 M.R.S.A. §1760, sub-§45:

An aircraft purchased and used outside of Maine but subsequently used in
Maine will be exempt from use tax provided the aircraft is not present in
Maine for more than 20 days during the 12 months following its purchase. Any
time during which the aircraft is present in Maine for major alterations,
major repairs or preventive maintenance is not counted against those 20
days.

On Dec 6, 1:34 pm, "Robert M. Gary" wrote:
On Dec 6, 8:22 am, "Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net
wrote:





Peter R. wrote:
Anyone else read the latest story in today's AvWebFlash's email
newsletter about the Massachusetts based pilot who flew his Cirrus
several times into Maine and unexpectedly received a Maine "use tax"
bill of over $26,000?

Must GA Pilots Stay Out Of Maine? (story about half-way down):
http://www.avweb.com/eletter/archive...ll.html#196716

That's just insane. I am an Angel Flight pilot for Angel Flight
Northeast and this story makes me think twice about accepting any
missions into or out of the state of Maine.

I read the story and it doesn't give a lot of information on what basis the
state is trying to charge the tax. A Use Tax in it's normal use is one that
is for items bought by a citizen of the state out of the state and brought
into the state. This sounds like they are trying to charge someone just
"passing through" or visiting. If that's the case it is insane. The same tax
could be charged to drivers who drive their car into the state.

The guy is screwed. For the purpose of tax collection I believe Maine
defines a citizen as someone who spends more than 20 days/year in
Maine. It sounds like this guy qualifies. Personally, I believe that
all use tax is unconstituational and I'd love for the courts to
actually get to handle a case that is this crazy.

-Robert- Hide quoted text -


How is this possible? Both Massachusetts and Maine have 5% use tax. If
he is a resident of MA, then he has already paid his sales tax to MA.
Regardless of where his residency is, how could ME ask for that same
tax? If he is from a state where there are no sales tax, then I could
see a point to this argument.

"Andrew Sarangan" wrote in message
...

How is this possible? Both Massachusetts and Maine have 5% use tax. If
he is a resident of MA, then he has already paid his sales tax to MA.
Regardless of where his residency is, how could ME ask for that same
tax? If he is from a state where there are no sales tax, then I could
see a point to this argument.


Massachusetts stopped charging sales tax on aircraft a few years ago. Maine
only charges it if the plane is purchased less than 1 year ago. I paid Mass
Sales Tax on mine, and have had it over a year, so they won't charge me.

On Sun, 9 Dec 2007 23:36:34 -0800 (PST), Andrew Sarangan
wrote:

How is this possible? Both Massachusetts and Maine have 5% use tax. If
he is a resident of MA, then he has already paid his sales tax to MA.
Regardless of where his residency is, how could ME ask for that same
tax? If he is from a state where there are no sales tax, then I could
see a point to this argument.

MA does not have a sales tax on aircraft, they have an annual
registration fee instead.

Regardless, I live in MA, if I want to spend 21+ days in various
locations in ME (hotel, B&B, camping, whatever) in the course of a
calendar year as a tourist they expect me to pay use tax on the
aircraft I use to go there? I'm reallly having a hard time seeing the
legal basis. The aircraft isn't based in Maine, I don't live there,
don't own property there, and I don't spend (181?) days a year there
to be considered a resident by what I understand is a normal standard,
so what is the legal basis for this (other than what appears to be a
defective state law)? Hell, I bet someone with money and time could
get it struck down under equal protection, let us know when you start
sending tax bills to out of state car owners and trucking companies
that log more than 20 days/year through the toll booths (on top of the
registration fee they already likely charge out of state trucks).

"Peter Clark" wrote in message
...

MA does not have a sales tax on aircraft, they have an annual
registration fee instead.

The registration fee is not 'instead' of the sales tax. It used to be both.
The Registration fee is instead of excise tax (what you pay your city/town
every year for your car)

Regardless, I live in MA, if I want to spend 21+ days in various
locations in ME (hotel, B&B, camping, whatever) in the course of a
calendar year as a tourist they expect me to pay use tax on the
aircraft I use to go there?

I don't think so. They seem to be trying to get the people 'going around the
system'. Various things like having a Delaware Corp own the plane, live in a
border town and keep your plane on the other side of the border, etc.

Sounds like the subject of the avweb story got caught in the middle.

On Dec 10, 4:59 am, Peter Clark
wrote:
Hell, I bet someone with money and time could
get it struck down under equal protection, let us know when you start
sending tax bills to out of state car owners and trucking companies
that log more than 20 days/year through the toll booths (on top of the
registration fee they already likely charge out of state trucks).

I think that is the plan. This guy has an attorney and I think AOPA
may be helping him too. However, in the interview I read he said its
only economical to take this so far. We'll see who gives up first.
In my opinion, knowing that Maine is a very liberal state, I think
that they are just ****ed off at anyone "rich" enough to afford an
airplane and believe they should give their money to the people (aka
the gov't), but that's just my political slant on this.

-Robert

On Dec 10, 7:59 am, Peter Clark
wrote:
On Sun, 9 Dec 2007 23:36:34 -0800 (PST), Andrew Sarangan

wrote:
How is this possible? Both Massachusetts and Maine have 5% use tax. If
he is a resident of MA, then he has already paid his sales tax to MA.
Regardless of where his residency is, how could ME ask for that same
tax? If he is from a state where there are no sales tax, then I could
see a point to this argument.

MA does not have a sales tax on aircraft, they have an annual
registration fee instead.

Regardless, I live in MA, if I want to spend 21+ days in various
locations in ME (hotel, B&B, camping, whatever) in the course of a
calendar year as a tourist they expect me to pay use tax on the
aircraft I use to go there? I'm reallly having a hard time seeing the
legal basis. The aircraft isn't based in Maine, I don't live there,
don't own property there, and I don't spend (181?) days a year there
to be considered a resident by what I understand is a normal standard,
so what is the legal basis for this (other than what appears to be a
defective state law)? Hell, I bet someone with money and time could
get it struck down under equal protection, let us know when you start
sending tax bills to out of state car owners and trucking companies
that log more than 20 days/year through the toll booths (on top of the
registration fee they already likely charge out of state trucks).

I suspect there is more to this story than what appears. The article
implies that the pilot owns vacation property in Maine. Even then, I
don't know how the state could know whether or not he spent 20 days
there. It is possible that he had claimed some type of tax excemption
for the property that he lived there for certain number of days per
year.