Co-Ownership Options

[rv7charlie]

Obviously, for profit. But ownership? You decide:
https://www.netjets.com/en-us/privat...xoCXNQQAvD_BwE

[Northernliving]

Originally Posted by Dan B

I have been in a partnership and it has stressed the best of friendships.

I am now in a co-ownership. Is has been working flawlessly.
I am responsible for hangar costs, insurance, fuel, maintenance, planning upgrades, and cleaning. I am also responsible for sitting right seat when the co-owner wants to fly. My co-owner (wife) also asks if we need to buy anything for the airplane when we go to AirVenture. As long as I uphold my responsibilities, everything is great!

That's the best partnership.... I have the same, but my bride likes to sit in the back and direct me to her favorite restaurant!

[jklusman]

Thanks so much for all the input. I still haven't decided which route to take, mainly because I need to review the sales-tax consequences of the various options in my state (Indiana).

[rocketman1988]

Good luck with getting info from Indiana. When I called them about sales tax on my -10 project, they had no clue what I was talking about...

So I guess tax doesn't get paid until it is an airplane, i.e. when I register an N number (not reserve it).

If you happen to find out something different, please post it...

[JonJay]

I was in a partnership many years ago. I ended up buying my partner out. I wouldn?t recommend it. Too many stories to tell here.
Two of my golf buddies, newly minted pilots, partnered on a 172RG. One of them just did a gear up a couple weeks ago. We will see how their friendship fairs now.

That said, I was in Europe recently and visited a flying club. 24 members share three aircraft. A Piper L4, Cherokee, and a Zlin, or something like that.
I would look to see how flying clubs are set up. Might give you some guidance.

[MConner]

I have owned a couple of aircraft in a co-ownership setup. It worked out fine. I feel the most important issue to have in writing is how to get out. Being trapped when you want out is bad.

[lr172]

Originally Posted by rv7charlie

What's different, other than scale & zeros on the check, between an LLC that sells a tiny share for access, and an organization like NetJets (other than the LLC vs corp vs ??)?

The issue is not the ownership component, it is about the ongoing expenses (hanger, hobbs time, overhaul, insurance, etc.) and who is paying them.

The difference is that Netjets uses certified aircraft where there are no aircraft related limitations on expense reimbursement to the owner. Operators/owners can share expenses with co-owners, as well as charge fees, if set up correctly and pilots are commercial rated. With experimental aircraft regs, the owner is expressly prohibited from accepting any type of expense reimbursement or payment for the use of their aircraft or the privilege of flying in it.

The FAA says that if I bring a friend in my 172, we can share the gas expense and possibly a maint reserve (issue only is whether or not a commercial lic is required by pilot, no aircraft limitation - If I have a commercial lic, I can charge what I want). If I bring a friend in my RV-6 I cannot share any expenses with my passenger, even if I am commercial rated. Here, with the commercial exception for exp aircraft they are going a bit further with their interpretation of commercial. In the Exp world, it is related to the aircraft limitations and not necessarily the pilot limitations.

Co-owners can share expenses. However, I fear that if the proportion of ownership isn't loosely matched to the expense proportioning, the FAA will cry foul and rule that it is a violation of the FAR's or Oper Lim's (not sure where it is outlined). Clearly the poster's plan is a creative way to circumvent the regs and liekly the FAA will see it that way. It is in the FAA's rights to rule that it is an exception and doesn't apply (sadly, the FAA is given the right to interpret the FARs as they see fit). They do this all of the time. Only recourse it to go before an ALJ and argue the case. If I were hearing this case, I would side with the FAA and hence my concerns. Loop holes only work when the laws are very specific and in this case they are not. It is VERY broadly written, and therefore requires someone's interpretation and under law, that falls to the FAA, with the NTSB's judiciary oversight.

Larry