Treasury to Clarify Types of Air Transportation Services Subject to Ticket Tax

Thank you for your letter concerning the Internal Revenue Service's (IRS) application of the commercial aviation ticket tax to aircraft management services provided to the owners of private aircraft. You requested that we review the IRS's position to determine whether it is correct, and if we determine that it is not correct, you have requested that the IRS issue guidance.

As you note, the IRS addressed this issue in a March 2012 Chief Counsel Advice memorandum. In response to feedback on the memorandum from aircraft management industry representatives, Treasury and the IRS are currently drafting guidance to more clearly identify the types of air transportation services that are subject to the commercial aviation ticket tax. This guidance project is in the 2013-2014 Department of Treasury Priority Guidance Plan.

If you have additional questions on this topic, please contact me or have your staff contact the Office of Legislative Affairs at (202) 622-1900.