Aviation Tax Enforcement Part II: What States Are Doing to Find You
Angel Houck reveals how states are using FAA registry data, ADS-B, and FlightAware to track down aircraft owners who haven't paid — and why ignoring that notice from another state is a costly mistake.
In my last article, I covered the current environment for federal tax audits. In this article, we will shift gears and focus on some state enforcement actions. I’ve mentioned many times before that state and local tax matters are often not properly addressed, which can lead to a large surprise tax bill. The states have become much more savvy about non-compliance, with many jurisdictions actively seeking uncollected revenue from aircraft.
Many states are using information from the FAA registry, ADS-B data, FlightAware records, and other publicly available sources to identify aircraft that may have tax liability. In the past, some aircraft owners would register their aircraft in a tax-friendly state to avoid taxes in another state, and this worked for many years. However, with today’s technology and access to information, those days are coming to an end.
There are definitely states that are more active than others. Florida, California, Colorado, Pennsylvania, Illinois, Utah, Kentucky, Georgia, and Tennessee are among the most common states we see notices in. Some notices will be very generic, identifying the aircraft and asking if sales or use tax has been paid. Others will be in the form of an audit or a use tax return inquiry. In any case, it is very important that a response be sent promptly to avoid an incorrect tax assessment or a potential lien on the aircraft.
Some local jurisdictions – counties, cities, and townships – also levy taxes on aircraft. California, Georgia, and Texas are three states that tend to have very sophisticated local enforcement groups. In addition, counties in California conduct regular audits of aircraft on the property tax roll, so owners can expect to see an audit every 5 years or so.
We find that many aircraft owners ignore received notices, especially if they come from a state other than their home state. This can be a costly mistake, either resulting in additional penalties and interest on unpaid balances or in increased professional fees to fight an assessment or lien. It is important that any inquiry received be addressed immediately by an aviation tax professional familiar with the laws of the state.
So, what can you do if taxes are assessed? More to come in the next article…
From Greenspan to Warsh, what “Higher for Longer” Means on the Ramp
Alaina J. Joseph connects Alan Greenspan's legacy and the Warsh Fed's hawkish June stance to what it means for aircraft buyers, owners, and dealers navigating a higher-for-longer rate environment.
The recent passing of Alan Greenspan marks the end of an era in American monetary policy. Serving nearly two decades as Chairman of the Federal Reserve, Greenspan helped shape the modern understanding that interest rates influence nearly every major financial decision from corporate investment to consumer borrowing. His legacy is a reminder that monetary policy has implications that extend far beyond Wall Street, into everyday capital decisions across industries.
That lesson feels especially relevant today.
At its June meeting under new Federal Reserve Chairman Kevin Warsh, the Federal Open Market Committee (“FOMC” or “the Fed”) held the fed funds rate steady as expected. What might have surprised market participants, though, was the hawkish stance by the Fed. The Fed raised inflation expectations while Warsh pronounced the committee’s “unambiguous and unanimous” commitment to price stability. Also standing out during the post-meeting press conference was Warsh’s silence on future monetary policy moves through traditional “forward guidance”.
While Warsh kept his remarks succinct and refrained from submitting his “dot” on the dot plot, which signals future rate projections, the other committee members did provide a meaningful signal. 9 out of the 18 members projected at least one rate hike before the end of the year. The dot plot is not a commitment to future monetary policy, but it does give some clues on the direction of policy members’ thinking. Taken together, the message suggests aircraft financing rates could remain higher for longer than many borrowers had anticipated at the start of the year.
For aircraft owners, dealers, brokers, and other industry advisors, that matters. Aircraft purchasing decisions are rarely made on the cost of borrowing alone. Business needs, tax considerations, and inventory availability all play a role. But the cost of capital is at least a contributor in the aircraft acquisition equation.
For prospective buyers, the “higher for longer” rate expectation could shift the timing decision. Many borrowers entered the year expecting rate relief in the second half of 2026. For those who have been waiting on the sidelines, locking in financing now might offer more certainty than waiting for a more favorable rate environment.
For current owners, this environment underscores the importance of loan structure over rate alone. Aligning amortization with residual value expectations to preserve equity, matching the loan term to ownership duration, and evaluating fixed versus variable-rate exposure are all important ways to proactively manage your balance sheet.
For dealers and brokers, the timing of transactions could increasingly depend on helping buyers navigate financing. Clear,early communication with the lender, education, and realistic rate expectations will be key to managing closing timelines.
Stepping back, there's a broader shift happening. Greenspan helped shape the Federal Reserve’s communication style and interactions with the public. Over time, borrowers could look to the Fed for signals on where rates were headed. Warsh appears less inclined to guide markets as former Fed Chair leader Greenspan and his successors have, which could result in less clarity around rate expectations for aircraft buyers going forward.
As the industry reflects on Greenspan’s legacy and watches the early months of the Warsh era, it’s clear the Fed continues to have a direct impact on the aircraft market. But in today’s environment, the ability to adapt to uncertainty rather than wait for clarity may be the most valuable tool aircraft owners have.
POPA at 30: Why Owner-Pilot Associations Matter for Your Aviation Insurance
Tom Hauge returns from POPA's 30th annual convention in Salt Lake City with a firsthand look at what owner-pilot associations mean for the insurance market and why showing up in person still matters.
I just returned earlier this month from the Pilatus Owners and Pilots Association (POPA) annual convention – this year the event was hosted in Salt Lake City at the Grand America hotel. The gathering is an annual conference that brings together the worldwide Pilatus dealer network, as well as the ancillary service providers including representatives from insurance (brokerage and underwriting), aviation finance, legal, aircraft modifications and MRO facilities. We had the good fortune this year to hear from underwriting carriers Sompo, Class A, and Starr,all three of which were represented on an insurance panel discussing current market trends, aging pilots, and risk management tools such as FOQA (flight operations quality assurance) and ADSB data.
The POPA organization is one of the longest-running OPAs (Owner-Pilot Associations) in the space, and each year seems to attract increased attendance at its annual conference. This year marks the 20th year I have been a member of POPA, and it was nice seeing some of my industry colleagues in Salt Lake City, whom I had met back in 2006 at POPA in San Antonio. The industry relationships are what it’s all about and the Pilatus community was certainly my first foray into the professional owner/pilot organizations since I started my aviation insurance career in 2004.
Over the last 20+ years, I have become involved with Citation Jet Pilots (CJP), the TBM Owners and Pilots Association (TBMOPA), Hondajet owners, Phenom Owners and PMOPA (Piper M Class owners) – each organization is a valuable conduit to my customer base in those respective classes of aircraft. The insurance industry has been supporting most of the owner/pilot organizations over the last decade or so. Several insurance underwriting carriers and aviation insurance brokerages provide market briefings and insurance panel discussions as part of the annual OPA convention agendas.
I think the more educated the customer base is about aviation insurance, the better the relationship is between the insurer, the broker, and the consumer. The “OPA” organizations are not only a great way to get the word out, but they also provide a venue to personally meet your broker and potential underwriter for those participating. If you are a client of my firm, I look forward to meeting you at your aircraft’s annual conference in the future.
Until then, FLY SAFE!
The Flight Departments Closing Did Everything Right
Dustin Cordier examines the quiet wave of well-run corporate flight department closures, CSX, Steelcase, VF Corporation, and what the industry needs to do right now to stop losing operators who did nothing wrong.
On December 1, CSX shut down a flight department that had run for 84 years. The pilots and mechanics who operated it were let go. A new CEO had been in the building for about ten weeks. The Gulfstream sits on the registry, waiting to be sold, and the people who built that operation are looking for work.
If you sit on the brokerage, finance, or service side of this industry, you have just lost a customer overnight. And CSX is not alone. Steelcase, the Grand Rapids operator the industry pointed to as a model, wound down its aviation department and sold its aircraft for roughly $30 million in savings. VF Corporation, parent of Vans and The North Face, sold both jets and listed its hangar while its CEO told analysts the company should not carry an “expensive aircraft program” through a turnaround.
These were not troubled operations. They were well-run departments at established companies, and they closed anyway. The NBAA Business Aviation Management Committee has been tracking the pattern, and three pressures keep surfacing.
The first is cost scrutiny. A flight department is a visible line item, so when a company tightens its budget, the aircraft draws more attention than its cost warrants. Few operators can present what the department returns in terms that the finance office recognizes. A department can run a clean operation and still be the first cut if it can’t explain its value. Justifying the airplane has become part of the job.
The second is talent. The pool of qualified pilots and maintenance technicians keeps shrinking, and the problem feeds itself. Departments compete for the same short list of people. Training can’t replace retirements fast enough, and a single departure can leave an aircraft sitting. When an operator can’t staff reliably, utilization drops, and that hands the budget reviewers an easy target.
The third is what took down CSX, and it comes when a company changes hands. New ownership, a succession event, or a sale puts the aircraft on the table fast, often before anyone has measured what it returns to the business. It gets questioned first and sold early, and that moment decides whether you keep the relationship.
When a department closes, the deals, financing, maintenance contracts, and service work built around it go with it. Anyone whose revenue depends on active flight departments has a direct stake in keeping operators healthy.
That is why the committee created the Securing Your Flight Department’s Future (SYFDF) Task Force. It collects what’s working across departments and gets it to the people who can help operators make their case, before the next budget review or ownership change arrives.
If your business depends on healthy Part 91 flight departments, the task force wants you involved. Reach out to me or to NBAA BAMC Chair Julie Goodridge at julie.goodridge@medaire.com.