New York, N.Y. (February 22, 2024) – On
February 21, 2024, the IRS announced its plans to begin dozens of audits
on business aircraft involving personal use. The agency indicated
that these audits will focus on aircraft usage "by large
corporations, large partnerships and high-income taxpayers and
whether for tax purposes the use of jets is being properly
allocated between business and personal reasons."
In the announcement, the IRS said: "Business aircraft are
often used for both business and personal reasons by officers,
executives, other employees, shareholders and partners. In general,
the tax code passed by Congress allows a business deduction for
expenses of maintaining an asset, such as a corporate jet, if that
asset is utilized for a business purpose. However, the use of a
company aircraft must be allocated between business use and
personal use. This is a complex area of tax law, and record-keeping
can be challenging."
