AOPA Pilot Magazine - March 1958 - (Page 32)

Operation PHCT PUT You may be able to reduce fiyd¥n expenses by taking advantwe of the wwwy legitimate fax deductions one of those ~keptical You may becostfindflying your own persons who it hard to believe that the of airplane and income tax time are closely related. But lts take another e' look at the facts-you may change your wind. The manner in which you fill out your Federal and State income tax forms could very wl determine el whether your flying i a luxury or an s economical means of transportation. This does not mean that you would have to resort to conscience-twinging practices around April 16. Simply take advantage of all o the tax savf ings the law allows you as an airplane owner or operator. It is possible you then will find that your air transportation costs in many instances are competitive with automobile travel. There is nothing wrong, either legally or ethically, in taking all of the deductions to which you ace entitled. When you start filling out your f o r m it is important. howeffer, that you recognize the difference between tax avoidance and tax evasion. Tax avoidance is an appropriate, intelligent legal activity which becomes important in direct proportion to your income, particularly if you earn more than $6,000 a year. It i merely malts ing sure that you get the moat of by ALFREDL.WOLF AOFA QBKSUAL COUifSKL all tax saving8 legally available to you. Tax evasion, of course. Is a different matter and cannot be eondoned. It is an attempt to escape, through illegal methods, paying the taxes the law requires you to pay. The Federal Internal Revenue Service has pretty well accepted the premise that expenses incident to the 1956. use of an airplane for business trans"The IRS man seemed to take the 32 portation should not be any less deductible than the coats of an automubile used for the same purpose. Last year, in order to educate itself on this problem affecting aueh a large part of ita membership, the Aircraft Owners and Pilots Association participated in the effort of one of its members to convince an IRS field representative that, for tax purposes, a taxpayer i not required to use the s cheapest mode of transportation when he travels between two pointa on business. The question continues to pop up in different parts of the country, but AOPA continua to supply its memters with AOPA publieatiom on tax savings to combat, among others, the odd contention that a salesman, for instance, must travel by automobile because it costs less to operate than an airplane. The AOPA member with whom AOPA Joined was, along with several other traveling representatives of a national organization, given an automobile allowance of eight cents a mile. Bather than use an automobile, the AOPA'er elected to use his airplane. H bad to bear all direct and e indirect expenses of operating the Cessna 140 out of his mileage a l w loance. Filially, he was called into an IBS office to explain his income tax returns for the years o 1954,1956 and f attitude that extra expenses incurred in flying were just my tough luck," the member said when he wrote AOPA National Headquarters calling the matter to its attention. "He insisted that I should use an automobile, just like the other representatives!' AOPA, of course, takes a dim view of the Federal agent's interpretation of the income tax laws. Its stock of material showing that travel by private airplane often waa more economical in the long run than other means of transportation was sent to the member. He also received a copy of an AOPA Special Report entitled "TaxSavings for Pilots and Owners." About a month later another letter was received from the AOPA'er. In sham contrast to the first communication, it w s buoyant and there w s a a no bint of taxpayer's gloom. He wrote that AOPA probably would be interested i knowing that n with the information it had sent out he bad been able to "settle his troubles" w t the Treasury Department. ih W e all of the tach were explored, hn it turned out that the Government owed the member $76 rather than the member being in arrears. The member and the Government called it a draw-neither aide collecting from the other-in order to bring about a quick settlement. IRS fast claimed that the taxpayer owed $1.700 additional tax on his income for only one of the three years in controversy. Certain basic deductions are available to all aircraft owners (as welt as other taxpayers) whether or not {Continued on gwge 651 THE AOPk PILOT

Table of Contents for the Digital Edition of AOPA Pilot Magazine - March 1958

AOPA Pilot Magazine - March 1958
Contents
Calendar
Legally Speaking
Editorial
What About Airspace Use, Mr. Pyle?
10,000 Seconds Under the Hood
Flying Weather One Month Ahead
AOPA Weathercast
AOPA 185579
Air-Age Teenagers Give City a Lift
Your Radio and You
Operation Cost Cut
Put Your Fabric to the Test
Are You "Compasss Punchy?
Yankee Duster in Latin America
South American Challenge
I Lived Through a Graveyard Spiral
Safety Corner and Accident Report
On the Airways
Travel
What's New?
Classified Department

AOPA Pilot Magazine - March 1958

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