sales tax on parts/ kit

[birddog486]

Wisconsin tax law states there is no sales tax on airplane parts excluding certain items and I'm trying to learn if this can be applied to building a kit. My tax lady printed out the state tax law for aircraft in Wisconsin for me but shes never dealt with it before.

Is there a way to apply the law to Kit purchases from a manufacturer either in or out of state?

Travis

[CarlOrton]

Check to see if WI has a “use tax”. We do in TX. Basically, if you buy something out of state there’s a form on which you declare it and pay the tax. Same rate (in TX) as the sales tax. Legally, even for something like a pair of socks.

Some states, if you don’t declare it and the state finds out, the estimate the product as a completed airplane, which is a much higher value than the parts in the kit.

Some states actively monitor the FAA database to find newly registered aircraft.

[martymayes]

My tax lady printed out the state tax law for aircraft in Wisconsin for me but shes never dealt with it before.


Talk to her supervisor and keep going up the chain till you get a definitive answer. The WI dept of revenue will ultimately decide if tax is due or not. I'm sure you're not interested in hiring a lawyer to argue the case.

[Frank Giger]

In Alabama one pays tax on the kit when the aircraft is done and gets its pink slip.

The kit price is used as a means of establishing the ad valorem tax.