Taxes on aircraft in Illinois

Maybe moving to Illinois in the spring from California (you may notice fingernail marks all the way there if you fly a little low) and wondering if I will be taxed in anyway? I bought the RV on an estate sale that went through an airplane broker so I have sales receipt that shows I paid taxes. Long story but it took me another 2 years to complete. Also put my name in for hangar at Morris (1st choice or Joliet, so if you have insider info please contact me. [email protected]
George

Illinois

I tried to send you an e-mail but it would not go through.

Don't feel bag George. In 1990 I took a transfer from Huntington Beach to New Jersey. I think you will be alright.

Of course, five years later I was moved to the Carolinas.

Illinois treats aviation as a use tax, not a sales tax. Illinois requires there own aircraft registration as well. Once they see your N number in the state, they will reach out to you. They look at new registrations / AW's and they force each airport to provide N numbers of every plane located on their field.

Use tax is based upon value and is due 30 days after plane is brought into the state. I believe you will not be required to pay anything until it gets an A/W cert. as long as you paid sales tax somewhere else on ALL of your parts. It doesn't matter if you have paid sales tax somewhere else they still charge the use tax. I didn't pay until they found me and got clipped with a late fine. I was banking on the state staff shortages to possibly miss me. No such luck.

Larry

Based on this Illinois Use Tax form filed for vehicles including aircraft, these instructions are provided:

Line f: Check Box f to claim the out-of-state resident exemption.
Illinois law allows an exemption from use tax if you were an
out-of-state resident (individuals only) and the item was used outside
Illinois at least three months. You must surrender the out-of-state
title, registration, or other proof of the item?s use when you apply for
an Illinois title. You cannot claim this exemption if you are a business
relocating into Illinois, an individual who used the item outside Illinois
for less than three months, or a military member whose home of
record is Illinois.

Sounds like if you have complete records and met the requirements, you would not have to pay use tax.

FWIW, you may consider living just over the border into IN. Housing cheaper, taxes much cheaper, schools as good or better depending on where in IL, etc.

I grew up in IL, and now live near South Bend. It would be tough to go back. No details on airplane ownership, though everything else is cheaper in the state that has a balanced budget and no ex-governors in jail.

aerovin said:

Based on this Illinois Use Tax form filed for vehicles including aircraft, these instructions are provided:

Line f: Check Box f to claim the out-of-state resident exemption.
Illinois law allows an exemption from use tax if you were an
out-of-state resident (individuals only) and the item was used outside
Illinois at least three months. You must surrender the out-of-state
title, registration, or other proof of the item?s use when you apply for
an Illinois title. You cannot claim this exemption if you are a business
relocating into Illinois, an individual who used the item outside Illinois
for less than three months, or a military member whose home of
record is Illinois.

Sounds like if you have complete records and met the requirements, you would not have to pay use tax.

Click to expand...

This does not apply to the aircraft use tax. I suggest you read the details. There is an aircraft section on the website. Some of the vehicle docs seem to apply, but do not. The law is pretty clear. If the aircraft is based in Illinois for more than 30 days, you pay the use tax. It doesn't even matter if you are an out of state resident.

Larry

Just registered my RV-9 in Illinois last year. Kit was started in MO. I had paid use tax in MO and IL for the kits so lots of various receipts. I had no problem with the tax man. Just sent in copies of all of the taxes paid, and I was even missing one where my only record was my checking account record book.

Just send in your record of taxes paid, and you'll be fine. FYI, there is no real difference between sales tax and use tax except for the method of collection.

The registration is just a small fee $20/2 years if I'm remembering correctly.

The website for the Illinois Use Tax has detailed instructions and information and is pretty clear.

keen9a said:

. FYI, there is no real difference between sales tax and use tax except for the method of collection.

Click to expand...

True. In most states it's simply a court-approved end-run around the constitution, which prohibits states from taxing interstate commerce.

Sales tax on new items

All I had to pay was sales tax on new items purchased out of state excluding shipping charges and my $10 per year registration. I worked with the state on this and did take advantage of a amnesty in force at the time. Did not pay any tax on value of completed aircraft. Keep your receipts and good luck.