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Tax Questions: the SIFL Rules and Flight Training

Asked by: 2130 views FAA Regulations, Student Pilot

As the tax accountants on this forum know, if you use a company plane for personal use, the IRS considers this to be compensation, and you are required to report the value of the flight as income on a form W-2. The method for calculating the value of the flight is called the Standard Industry Fare Level (SIFL) method.

I own my own business and am going to purchase a single engine plane through my business and fly it for business meetings and occasionally for personal reasons. I will also fly the plane to work on my instrument rating (and my commercial rating some time in the future).

1.  My first question has to do with whether a training flight is considered personal or can be considered business. Would a local training flight, for example working on my instrument rating, is that considered personal?  If I am the pilot that uses the company aircraft to attend business meetings, I am trying to argue that the instrument rating training is part of my job training, etc.

2. If the flight training is considered personal, how does the SIFL method work if you are taking off and doing instrument approaches and landings at the same airport or other nearby airports? Are there miles to be calculated, even if you only touch and go at those other airports, or if you stay at your home base airport? And what about the terminal charge in these situations, does it apply?

Sorry if this is just too technical of a tax question for this forum, but I thought I would give it a try since it seems like there are some pretty knowledgeable folks out there.

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1 Answers

  1. Bob Watson on Sep 30, 2014

    When it’s a personal flight, can you just rent the plane from your business?

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