There are numerous tax exclusions and exemptions that frequently impact our clients. Each year the Internal Revenue Service (IRS) evaluates, and often adjusts these exclusions and exemptions to account for inflation. This article briefly summarizes (1) the most common exemptions and exclusions, (2) the IRS adjustments to such exemptions and exclusions, and (3) what the 2023 adjustments mean for you.
In FMG Leasing, LLC v. Dep’t of Treasury, FMG Leasing was a limited liability company formed to hold title to an aircraft. No. 312448, 2014 WL 2931938 (Mich. Ct. App. June 26, 2014) (no reported citation available). FMG leased the aircraft to a concrete company that was one of FMG’s forming partners, and to the company’s president. FMG then sought to take advantage of a statutory exception under Michigan law that permits a lessor of tangible personal property to pay use tax on receipts from the rental of the property, instead of paying a sales or use tax on the full cost of the property at the time of purchase.
Missouri Governor Jay Nixon has now signed a bill extending indefinitely the exemption of aircraft replacement parts from the Missouri sales tax.