Government Takes Aim at Corporate Jet Tax Breaks
In a significant move to ensure tax compliance among the wealthy, the government has set its sights on the corporate jet industry. A recent audit campaign initiated by the IRS in February is targeting executives who may be exploiting tax breaks for personal use of corporate jets. This increased scrutiny comes as part of a broader effort to make the affluent contribute their fair share to the nation’s coffers.
Further tightening the reins, President Joe Biden’s proposed budget seeks to amend depreciation rules and proposes a hike in the tax rate on private jet fuel. This would potentially close loopholes that have allowed for deductions on expenses related to personal use of corporate aircraft.
In a concerted push for reform, Senate Democrats have penned a letter to the Treasury Department and the Internal Revenue Service, advocating for changes in the way corporate jet owners can deduct certain costs. This legislative interest underscores the growing concern over tax equity and the need for a fair tax system that does not disproportionately benefit the wealthy.
Bloomberg Tax reporter Erin Schilling recently discussed these unfolding developments with Michael Kaercher, a senior attorney adviser at the Tax Law Center at New York University. Kaercher shed light on potential regulatory changes that could complement the IRS’s enforcement actions and delved into the reasons behind the corporate jet industry becoming a focal point for tax reform.
The conversation, part of the Talking Tax podcast series, is available for listeners on platforms such as Apple Podcasts, Spotify, Google Podcasts, Megaphone, and Audible. The series invites feedback from its audience, encouraging listeners to leave voicemails with their thoughts on the episodes.
As the government continues to crack down on tax avoidance strategies, it is clear that industries previously benefiting from generous tax provisions are now under rigorous examination. The corporate jet sector, once flying under the radar, is now squarely in the spotlight as policymakers seek to navigate a more equitable taxation landscape.