Aircraft Ownership & Operating Structures

Where Federal Tax, State Tax, and Federal Aviation Regulations Must All Fit Together

Craft Your Custom-Tailored Ownership and Operating Structure

Aircraft ownership lies at the intersection between the Internal Revenue Code (IRC), state sales, use, and property tax regulations, Federal Aviation Regulations (FARs), and laws limiting or imposing liability. Each aircraft owner’s situation is unique and our job is to help clients tailor their ownership structure to their individual circumstances.

Frequently Asked Questions

What Are My Options?

There are a variety of ways companies can own and operate aircraft including full or co-ownership, joint ownership, fractional ownership, aircraft charter, or aircraft leasing. This decision ultimately depends on an aircraft owner’s mission, objectives, and budget.

Should I Hold My Aircraft In an LLC?

The answer ultimately depends on which factors are most important to an owner’s decision-making, though factors that support owning an aircraft in an LLC include liability protection, tax mitigation, and estate planning. If this structure is chosen, owners should beware of the “flight department company trap” also known as an “illegal charter”.

Should I Hold My Aircraft in a Trust?

Do you have estate planning motivations? Are you a non-U.S. citizen? Do you prefer or require anonymity? Although there may be additional motivating circumstances, if you answered yes to any of the foregoing questions, a trust may be a good option.

How Do I Avoid The Flight Department Company Trap?

Put simply, do not own and operate your aircraft in a special purpose entity (SPE) that has no other business than owning and operating the aircraft. This is illegal and can lead to FAA fines, voiding of aircraft liability insurance, and loss of pilot’s licenses.