One CA builder's experience
Just a note for other pre-taxed CA builders how it worked out for me.
A few years ago, I put down a big chunk o' cash on the "use tax" line of the regular CA state return. It covered use/sales tax on major subkits from Vans and large items (Dynon avionics
not bought from Aircraft Spruce) I had acquired over my long, ultra-slow build. Oddly, there's no place on the return to itemize what the use tax was for...CA accepted the money anyway.
In 2017, N748PK appeared in the FAA registry, I got a letter from CA use tax folks--if you bought this aircraft out of state, you may owe use tax, fill out this form, etc.
I wrote a cover letter 'splaining I didn't buy an airplane but home-built kits & parts. I stapled copies of the relevant receipts and a copy of page 1 of the CA return showing use tax already paid to the form. Also enclosed a check for small money because the use tax rate on the form was different from Alameda county's historical rates. For such a small amount I decided not to poke the CA bear.
Last week got a letter from the use tax folks, stating my "case number" was closed. Although many of the receipts antedated the year I paid the big hunk o' use tax, I made no effort to call that out in the cover letter, and nothing about late fees and interest charges said by the tax man.
I also got the other letter from the Alameda County assessor, seeking information to appropriately value N748PK aircraft as of 1 Jan 2018. I gave them make, model, engine, avionics installed, etc. I checked off "poor" for exterior and interior condition, because the definition of poor included extensively weathered or damaged paint, and N748PK had no paint on it and no interior furnishings (seat cushions, seat belts) as of 1 Jan. Moreover, the definition of "aircraft" in the CA tax code is an aerial conveyance
that has flown at least once.
While I aspire to final inspection, special a/w cert, and first flight sometime this year, technically N748PK should incur zero property tax liability for now....
DISCLAIMER: The foregoing neither constitutes tax advice nor an offer to provide tax advice. Your mileage may vary. Consult your personal tax adviser, not internet chatter, before investing or sending money. Watch out for falling meteors. Get enough fiber.