And Get This... Yet ANOTHER Reason To Avoid Sun 'n Fun!

Since ANN broke the bewildering details of a number of long-suffering non-resident pilots who have been caught in the FL tax trap, (otherwise known as the "Florida landing Fee"), we have learned that a full-fledged tax revolt is now underway costing the state untold monies as a result of a growing voluntary boycott that is gaining steam, even as we write this.

Over the course of our investigation last year, ANN learned of a number of issues that have arisen when owners of new aircraft, generally within the first six months of the sale, have been targeted for "use tax" by agents of the state's Department of Revenue... despite the fact that the targeted aircraft were not owned or operated by state residents.

It starts like this... you buy a new or used aircraft and sign the bill of sale... which starts "the clock." It is Florida's position that for the next six months (possibly thereafter, though the burden of proof reportedly changes at that point), the state has the right to exact the requisite "Use Tax" (Sales Tax) for the fact you partook of the state's services unless you can show an equivalent Use or Sales Tax receipt from another state...

In other words, for those of you who may have bought a $500K Cessna, Cirrus, Columbia, etc... unless you can prove that you paid the equivalent use tax in another state, you owe the state of Florida some $30K if you visited the state in the first six months of your ownership. Mind you, if your sales/use tax bill comes from a state that exacts LESS tax than Florida, the FL Department of Revenue still expects you to pony up the difference... and if you're from a state that exacts a minimum fee (like the few hundred dollars for owners in South Carolina), they will bill you for the WHOLE difference... and its up to you to fight them on it.

No kidding.

It makes NO difference to the state if you have any property in Florida, or whether you bought the airplane there, or if you have ANY business interests whatsoever in the state... If Florida catches you here and if they can find a way to stick you with a tax bill, they will.

According to the Florida Tax Code, "There shall be a presumption that any aircraft, boat, mobile home, motor vehicle, or other vehicle purchased in another state, territory of the United States, or the District of Columbia but titled, registered, or licensed in this state is taxable except as otherwise provided in subsection (26) of this rule. This presumption may be rebutted only by documentary evidence that the person owning the aircraft, boat, mobile home, or motor vehicle purchased the aircraft, boat, mobile home, or motor vehicle in another state, territory of the United States, or the District of Columbia six (6) months or more prior to the time it is brought into this state. In order for such property to be presumed exempt as purchased for use outside Florida, the person owning the aircraft, boat, mobile home, motor vehicle, or other vehicle must provide documentary proof that such property was used in other states, territories of the United States, or the District of Columbia for six months or longer under conditions which would lawfully give rise to the taxing jurisdiction of another state, territory, or District of Columbia and any lawfully imposed tax was paid to such state, territory, or District of Columbia before being imported into this state. However, the rental or lease of any aircraft, boat, mobile home, or motor vehicle which is used or stored in this state is taxable without regard to its prior use or tax paid on the purchase outside this state."

Why?

Because they can.

The very liberal Florida tax code allows them to tax aircraft if they operate at any time during the first six months of a purchase in the state... and according to some interpretations, there may be some legal justification for Florida to tax you if you so much as fly OVER the state.

This problem has been known for a while, but 2007 ramp checks by FL DOR personnel were reportedly stepped up, and snagged a number of unwary owners -- including at least one Cirrus owner and a Meridian owner who came back to Florida to undertake flight training in his new airplane. The Cirrus owner was on the hook for some $30K in additional taxes... the Meridian owner wound up paying over $100K.

Now, the situation is getting widespread attention from a group of Cirrus owners who want to attend a group flying activity that will put them in FL overnight as well as others who are now deciding to avoid the annual Sun 'n Fun Fly-In... which really doesn't need any more trouble than it's already made for itself (ANN E-I-C Note: the event is in very serious decline and its survival is not only in doubt, but the odds appear stacked against it. Worse, it has some serious safety issues that still need to be addressed).

One Cirrus owner, who called ANN, reported that he's made a number of calls to FL officials and still feels that the risk to his financial health is "unacceptable" and that he feels that FL's tactics appear to be "predatory." When he called Sun 'n Fun offices for help, he received a deaf ear. The Owner/Pilot has reported that he told SnF staffers that "I had cancelled plans to be in Florida during the event and would not be able to visit Sun-N-Fun because of the DOR issue."

He added that he, "... gave the gentlemen I spoke to a very brief description of the issue and asked him if they were doing the responsible thing and (notify) their attendees of this potential trap. He quickly told me I better speak to someone else about this and transferred me to another phone. No one answered the phone and it went to voice mail. I repeated a short description of the issue, gave him my name and contact phone number and have heard nothing since. The curious thing is that there was an awful lot of background discussion going on before I was transferred to voice mail..."

Other pilots report a similarly deaf ear, and even disconnects, when they call Lakeland for assistance. For those familiar with the usual quality of SnF "service," this is hardly a surprise.

But... there is a white knight on the horizon. The Florida Aviation Trades Association has been aggressively lobbying the state in order to get this rule-making stricken from the ledger in upcoming sessions of the state legislature. Late Thursday, FATA's President Michael Slingluff (another one of the 'hardest working guys in GA'), and FATA Executive Director Paula Raeburn informed ANN that, "The Florida Aviation Trades Association, FATA, who represents general aviation business and interests in Florida, has been following the sales/use tax issue and is diligently working with the Florida State Legislators and the Florida Department of Revenue (FDOR) is resolve this issue once and for all. We had a small success in Tallahassee today as HB 1379 passed through one committee. It has been an uphill battle but FATA has been tenacious in their efforts. Any changes will be effective July, 2008 so in the short term, there is no relief but we hope to have success during this year's legislative session. The intend of the statute was not keep pilots out of Florida but that is happening and we have made legislators and FDOR aware of the issue. Florida depends on tourist dollars and we want new aircraft owners to be able to fly here and enjoy all Florida has to offer."

FATA fully expects the tax situation to be repealed at some point, but that progress remains "dreadfully" slow. In the interim, the rule remains highly selective. In a May 2007 phone con, ANN chatted with a spokesperson for the FL DOR, Rene Watters, who was clearly unapologetic for the issue. She told ANN that they are simply 'doing (their) jobs' and that if anyone has a problem with that, to "take it up with the legislature." This matter, of course, can be appealed through the courts... but this route necessitates expensive and time consuming litigation, via the use of a trained tax attorney... and you may still lose, after all.

Catch 22.

Other DOR staffers opine that aircraft owners have it particularly hard, since they admit that RVs and boats get a somewhat more permissive treatment from them, "...Probably due to better lobbying on the part of their industry reps."

In the meantime, ANN has documented extensive tales of pilots who are avoiding the state of Florida like the proverbial tax plague. Worse; a number see the problem as a safety of flight issue that could subject the state to potential liability. "If I have to fly farther, or through worse weather, to avoid the possibility of unfair tax penalties, who's responsible if I have a problem and an accident results because I didn't want a single flight to cost me $50,000 dollars?," asked one flyer.

Dozens of pilots have reports cancellations of trips to Florida and over 100 pilots have questioned the wisdom of visiting this spring to go to Lakeland -- for a number of reasons. "While Oshkosh is a 'must', Lakeland really hasn't been any fun for years. It's always been too expensive but the chance of a big tax bill just makes it damned ridiculous. So, this is one more reason that Lakeland isn't going to be on my travel schedule any time soon," added one Cirrus owner.  

ANN Synopsis: ANN has calls into the State officials as well as FL Governor Charlie Christ, in order to seek additional information and guidance on the matter, but to be honest, if you have an airplane that is NOT based in FL, and is less than 6 months old (or even close to that), we'd give FL a wide berth until this Draconian taxation issue is resolved fairly and ethically... and as far as Lakeland is concerned, it sure doesn't seem to be worth the price of admission anymore, much less the potential of a multi-thousand dollar tax bill. For this and quite a number of other reasons, we suggest giving Lakeland a pass.

FMI: Click Here To Learn More, www.fata.aero