Save 7.5% FET on Charter and Jet Card Flights
Business Aviation Partner John Hoover was interviewed for a SherpaReport article on the CARES Act suspension of federal excise taxes (FET) on air transportation through the end of the year. Mr. Hoover discussed the FET suspension and its implications for prepaid private aircraft travel, including guidance for ensuring that jet cards or charter flights purchased in 2020 still qualify for the tax holiday, even if they are not used until 2021.
According to an IRS FAQ, if you pay in 2020 for travel in 2021, "no tax is imposed on the purchase of the ticket because the purchase occurred during the excise tax holiday," Mr. Hoover explained, adding that it's important that the purchase is for a specific flight instead of a general deposit for future flights.