California Aircraft Taxes by Jay White

There has been a recent increase in aircraft personal property taxes for many California aircraft owners. A 40% increase over that of last year is not uncommon. This increase appears to have been precipitated by the continuing economic crunch that most counties are experiencing.

There has been a recent increase in aircraft personal property taxes for many California aircraft owners. A 40% increase over that of last year is not uncommon. This increase appears to have been precipitated by the continuing economic crunch that most counties are experiencing.

While the law has not changed, certain tax assessors are now updating their files to assess aircraft at their actual value. A handbook, HB 587, is available from the California Board of Equalization for use by assessors. The handbook is supposedly based on the industry’s “blue book” for aircraft, possibly modified by reference to aviation publications such as Pacific Flyer or In Flight. The good news is that due to a dwindling number of good aircraft, many are increasing in value.

Although it is likely too late to contest this year’s assessment, aircraft owners who wish to contest their individual assessments should contact their respective assessors’ offices for instructions on the appeal procedure for next year. The assessed value of a given aircraft should take into consideration such factors as its age, total time on airframe, engine time, avionics, interior and exterior condition.

Another associated tax is a possessory interest tax that may be included on the aircraft main tax statement or on a separate statement. A possessory interest tax is one that is assessed on the ground where an aircraft is tied down, or where a hangar is erected. That tax is in addition to rent paid for the same space.

Both the aircraft personal property taxes and the possessory interest taxes are distributed as follows: 1) One third to the city in which the airport is situated; 2) One third to any local school district; 3) One third to the county general fund. If the airport is not within a city, the full amount is divided between the local school district and the county. None of this tax revenue is kept for use on an airport.

Other assessments appear on aircraft tax statements in certain counties. These include assessments for such things as mosquito abatement or water district charges. Why these taxes should be assessed against aircraft is not clear since they bear no relation to airports or other services provided for aircraft users.

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