Hapy New Year, first business day of the year and I just got a tax notice from the city of Gwinnett. Can anybody give me an idea of the tax bill I should budget for? Is there also a State Tax?
Steve
Steve,
I assume this is a property tax assessment, if so, read below. If it is a sales/use tax assessment, skip down to the bottom of the page.
Property Tax:
What is the local millage rate, what aircraft do you have, and what is its status (tail kit finished, nearly complete airframe with 747 style panel, flying aircraft, etc)?
In Georgia, the property tax is based on 40% of the assessed value of the property multiplied by the millage rate.
My airplane is taxed in a county where the millage rate is about .028. If my airplane was assessed at $50k by the county (it isn't), the tax would be 40% x $50,000 x .028 = $560/yr.
One thing to note is that you essentially get one chance to establish the value of the airplane for property tax purposes. If it gets established too high, you'll end up fighting city hall and losing.
In my case, the county tried to base the value of my airplane on the asking price of RV-6's and -6A's advertised in Trade a Plane. Some of those airplanes had panels that cost more than my entire airplane. Also, asking prices are not selling prices. Once the county and I came to a mutual understanding things were much better.
Sales and Use Tax:
Georgia charges a sales and use tax based on the cost of what you purchased. On a homebuilt aircraft, if you purchased it, you will end up owing the state 6% of the purchase price, assuming you lived in Gwinnett County when you purchased the aircraft. If you are registering a new homebuilt, you will need to provide records to the state to demonstrate what you paid for all of the items that went into your airplane, and will pay sales tax on that amount. Exempt items include used items (a used motor, for instance, or a second hand wing kit), items purchased in state where you've already paid the tax, and items purchased over the internet.
Bottom line... They get you coming and going...