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  #1  
Old 02-11-2017, 08:25 AM
RV7ator RV7ator is offline
 
Join Date: Jan 2005
Location: Boise, ID
Posts: 952
Default Is The $500 Rebate Taxable?

While poking fun at a friend who's encountered a variety of obstacles with his Stratus ESG installation, we got to wondering if the $500 rebate will be taxable income at the Fed level.

Anyone know for sure? (I'm not interested in states' interest.)

BTW, Appareo has bent over backwards once they understood they weren't dealing another dumb installer. This one box has problems that show towards the end of qualification flights. The whole company is involved digging into evaluation and remediation of this anomalous unit. A new replacement was shipped to my friend. That's good service.

John Siebold
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  #2  
Old 02-11-2017, 11:41 AM
BobTurner BobTurner is offline
 
Join Date: Dec 2011
Location: Livermore, CA
Posts: 5,132
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The FAA rebate web site says it is taxable.
As far as I'm concerned this is 'hobby income'; my 'hobby losses' are much larger, so there is no effect since hobby losses aren't deductible.
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  #3  
Old 02-11-2017, 12:02 PM
jliltd jliltd is offline
 
Join Date: Sep 2013
Location: Rancho San Lorenzo
Posts: 359
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You will get a 1099-MISC from the Gubmit'. Depending on tax bracket, many feel between the multiple fights to iron things out and qualify for the rebate, along with the 1099 it just isn't worth it. It's another typical government boondoggle and therefore takes away the incentive (along with the pressure to comply by a rebate date).

Jim
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Last edited by jliltd : 02-11-2017 at 12:06 PM.
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  #4  
Old 02-11-2017, 02:54 PM
Deweyclawson Deweyclawson is offline
 
Join Date: Jun 2014
Location: Enon Valley
Posts: 121
Default rebate???

Since they give you a 1099, it behooves you to report the income or it will attract a letter from the IRS.
Report the income and report the money spent to qualify for the rebate.
No tax due.
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  #5  
Old 02-11-2017, 05:20 PM
rv7charlie rv7charlie is online now
 
Join Date: May 2006
Location: Pocahontas MS
Posts: 2,903
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So, you're saying that a non-deductible expense (the ADSB) that's made less expensive by a rebate, causes a tax on the rebate? Nah.

Now if it's a deductible business expense, maybe so.
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  #6  
Old 02-11-2017, 05:27 PM
StuBob StuBob is offline
 
Join Date: Oct 2015
Location: Indianapolis, IN
Posts: 248
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Quote:
Originally Posted by jliltd View Post
You will get a 1099-MISC from the Gubmit'. Depending on tax bracket, many feel between the multiple fights to iron things out and qualify for the rebate, along with the 1099 it just isn't worth it. It's another typical government boondoggle and therefore takes away the incentive (along with the pressure to comply by a rebate date).

Jim
Do you mean the rebate isn't worth it or ADS-B isn't worth it?

The rebate doesn't cause the multiple flights. Taxed or not, getting the rebate puts more money in your pocket than not getting it.

But if you're referring to ADS-B, you're right. There isn't enough money in the rebate to make me get it if I weren't planning to, or enough to affect the timing of my install.
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  #7  
Old 02-12-2017, 06:49 AM
Tooch Tooch is offline
 
Join Date: Nov 2011
Location: Amelia, Va
Posts: 180
Default 1099

Has anyone received this 1099? I haven't and I don't remember giving the FAA my SS number or tax ID.
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  #8  
Old 02-12-2017, 02:26 PM
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Jesse Jesse is offline
 
Join Date: May 2005
Location: X35 - Ocala, FL
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Quote:
Originally Posted by Tooch View Post
Has anyone received this 1099? I haven't and I don't remember giving the FAA my SS number or tax ID.
Good point. That will be a little tough for the IRS to track. They may send a 1099 to your name and address, but with no SSN or FEIN, the IRS will have no way of keeping track. Also, $500 is below the 1099 threshold (unless it has changed in the last year or two) that requires filing. Either way, income is income. Failure to report is tax evasion.
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  #9  
Old 02-12-2017, 06:25 PM
David Paule David Paule is offline
 
Join Date: Dec 2009
Location: Boulder, CO
Posts: 3,463
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I'm only an engineer, but I think Dewey has it right in post #4.

I think I'll report the income and include a copy of the installation invoice and whatever other pertinent documentation that I think of, and if they want to disallow my offsetting expense, so be it.

Dave
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  #10  
Old 02-12-2017, 07:00 PM
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Mel Mel is offline
 
Join Date: Mar 2005
Location: Dallas area
Posts: 9,924
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Quote:
Originally Posted by Deweyclawson View Post
Since they give you a 1099, it behooves you to report the income or it will attract a letter from the IRS.
Report the income and report the money spent to qualify for the rebate.
No tax due.
Sorry but that money spent is not deductible, and the rebate IS income. It's not like gambling losses.

If you don't want to claim it, that's between you and IRS.
But please don't encourage others.
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Last edited by Mel : 02-12-2017 at 07:10 PM.
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