Aircraft First Used Outside Nevada Not Subject to Nevada Use Tax

Thursday, March 27th, 2014

 
 
Share
Link
Nevada
General

The Nevada Supreme Court recently ruled that a taxpayer's purchases of two aircraft were not subject to Nevada use tax because the aircraft's first flights were outside Nevada.

Nevada's use tax applies to purchases of tangible personal property for storage, use, or consumption in Nevada. The law presumes that property delivered outside Nevada for use in interstate commerce is not for storage, use, or consumption in Nevada if two requirements are met. First, the property's first use in interstate commerce must be outside Nevada. Second, the property must be continuously used in interstate or foreign commerce for at least twelve months after that first use.

The taxpayer purchased four aircraft to carry employees and guests to and from its business locations. It purchased two aircraft in Arkansas and flew them to Nevada. It purchased another two aircraft in Oregon and flew one to Arkansas and one to California. The taxpayer used the aircraft in interstate commerce from these flights onward. Each of the aircraft flew to and from Nevada on a regular basis.

The Supreme Court decided that the relevant "first use" of an aircraft was its first flight. To be "outside" Nevada for its first flight, an aircraft could neither depart from nor arrive in Nevada. The two aircraft purchased in Arkansas were therefore first used in Nevada and did not qualify for the presumption against use tax. The two aircraft purchased in Oregon, however, were first used outside Nevada. The presumption against use tax did apply to these two aircraft. Because the state did not overcome the presumption, the Court decided that the taxpayer did not owe use tax on the two aircraft purchased in Oregon.

http://www.ttrus.com/sites/default/files/nv/nevada_aircraft.pdf


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Colorado Waives Penalties for Notice and Reporting...

Monday, February 19th, 2018 -The Colorado Department of Revenue (DOR) released a publication stating that it has agreed to waive penalties ...

Maryland Sales Tax Holiday for Energy Efficient...

Friday, February 16th, 2018 -The Maryland sales tax holiday for energy efficient appliances runs from Saturday, February 17, 2018, at 12:01...

Dental Prostheses Exempt in Michigan

Wednesday, February 14th, 2018 -The Michigan Department of Treasury recently released a publication describing the retroactive exemption for d...

Taxability of Amusement Devices and Video Games in...

Monday, February 12th, 2018 -The Wisconsin Department of Revenue has released guidance addressing the taxability of video games and amuseme...

Video Streaming Subscriptions Taxable in Texas

Friday, February 9th, 2018 -The Texas Comptroller of Public Accounts recently ruled that video streaming and add-on services are taxable a...

Moratorium on Medical Devise Excise Tax Extended Two More...

Wednesday, February 7th, 2018 -The United States Congress extended the moratorium on the Medical Device Excise Tax (MDET) for another two yea...