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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
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105.0000 Aircraft—Regulation 1593
Annotation 105.0066.500
105.0066.500 Common Carrier Presumption. Subdivision (b) of section 6366 establishes a presumption that an aircraft was not purchased for use in common carriage if the aircraft owner does not receive in annual gross receipts from the lease of the aircraft at least twenty percent of the purchase cost of the aircraft to him or her, or $50,000, whichever is less. The period for determining the application of this presumption commences upon first operational use of the aircraft and ends after twelve months unless the aircraft is sold prior to that time, in which case the presumption test terminates on the date of the transfer. The $50,000 presumption is based on a one-year test period. If the test period is thus less than 12 months, the $50,000 presumption is adjusted on a prorated basis. For example, if the purchaser sells the aircraft six months after the aircraft's first operational use by the purchaser, the presumption of section 6366(b) will arise if the purchaser has not received at least ten percent of the purchase price of the aircraft or $25,000 in gross receipts, whichever is less. 9/23/99. (2000–2).