Business Aviation Lawyer - Stewart H. Lapayowker, P.A.

We Rock to Benefit Stomach Cancer Research!

stewart — Wed, 07 Mar 2012 16:59:47 +0000

On March 4, 2012, CantStomachCancer had its third annual benefit at the Improv Hard Rock, Hollywood, Florida. Can’t Stomach Cancer is a charitable foundtion that raises money for stomach cancer research. Stewart H. Lapayowker, P.A., PlaneTalkRadio and Aero Management Solutions, LLC were sponsors of the event for a second year, but instead of a comedy act like Stewart did last year, this year we had a surprise for everyone! We hope you enjoy! http://youtu.be/6INmcOcscc0

Aircraft Transactions Conference February 9, 2012

stewart — Sun, 18 Dec 2011 20:04:09 +0000

Mr. Lapayowker will be joining other speakers at the NBAA’s Aircraft Transactions Conference to be held in Deerfield Beach, Florida on February 9-10, 2012. The topic of his presentation with Jeff Wieand of Boston JetSearch, Stewart Pearl, Esq., and Alvaro Pascotto, will be aircraft transactions in transition. They will be discussing aircraft offers to purchase, purchase agreements and related issues in connection with the acquisition of an aircraft.

To register, go to www.nbaa.org.

We hope to see you there.

BARR Requests – Valid Security Concern No Longer Required

stewart — Sun, 18 Dec 2011 17:03:08 +0000

BLOCK AIRCRAFT REGISTRATION REQUESTS

“VALID SECURITY CONCERN” NO LONGER REQUIRED

The language of the Department of Transportation’s budget for Fiscal Year 2012 prohibits the Federal Aviation Administration (FAA) from requiring certification of a “valid security concern” as a condition to blocking aircraft tail numbers from tracking by online services. The National Business Aviation Association is monitoring FAA’s implementation of the revised BARR system.

Until that system is finalized, FAA will no longer need to certify to (or mention) a “valid security concern” in order to have the blocking request accepted.

Regards. SHL.

To comply with U.S. Treasury Department and IRS regulations, we are required to advise you that, unless expressly stated otherwise, any U.S. federal tax advice contained in this e-mail, including attachments to this e-mail, is not intended or written to be used, and cannot be used, by any person for the purpose of (i) avoiding penalties under the U.S. Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this e-mail or attachment.

Nothing contained in the foregoing should be relied upon as legal advice appropriate to your situation which can only be given by your own legal counsel.

APPOINTMENT AS VICE CHAIR OF NBAA TAX COMMITTEE

stewart — Sun, 18 Dec 2011 17:00:53 +0000

APPOINTMENT AS VICE CHAIR OF NBAA TAX COMMITTEE

In conjunction with the annual meeting of the Tax Committee of the National Business Aviation Association, Stewart was appointed to be Vice Chair of the NBAA Tax Committee serving a two year term.

Having served as Recording Secretary for the past two years, and before that Chair of the Committee’s Aircraft Transactions Working Group and Vice Chair of its Regulatory Working Group, Stewart is flattered by the Committee’s appointment and looks forward to actively working with the leadership team and NBAA liaisons to address significant issues facing business aviation.

The Tax Committee’s efforts are focused in the area of taxes affecting business/corporate aircraft and the impact of the Internal Revenue Service Rules, Securities and Exchange Commission Rules, and the Federal Aviation Regulations. The Committee explores the implications of these rules and regulations, as well as the differences between IRS and FAA interpretation/definition of business aircraft and develops meaningful resources for NBAA Members in each of these areas. The Committee addresses topics such as aircraft transactions, aviation insurance, federal tax, regulatory, state aviation taxes and regulatory matters.

The Committee’s “NBAA Tax, Regulatory & Risk Management (two-day) Conference” held each year in conjunction with the NBAA Annual Meeting and Convention is designed to provide a basis for understanding how the appropriate tax laws and other applicable regulations apply to a particular aviation operation. It covers issues such as aircraft registration, ownership options, personal use, leasing options, application of the FARs, enforcement of the FARs and insurance.

For those of you not familiar with the NBAA, the NBAA’s mission is to serve NBAA Members by promoting the aviation interests of organizations utilizing general aviation aircraft for business purposes in the United States and worldwide. Founded in 1947 and based in Washington, DC, the National Business Aviation Association (NBAA) is the leading organization for companies that rely on general aviation aircraft to help make their businesses more efficient, productive and successful.

It’s cooperative organization No Plane No Gain.org is aimed at educating the public about the benefits of business aviation in the face of media and political attacks on the industry.

The NBAA now provides assistance to 8,000 Member Companies which earn annual revenues of approximately 5 trillion dollars – a number that exceeds 50 percent of the gross national product – and employ more than19 million people worldwide.

NBAA has been in the forefront of efforts aimed at fairly settling problems related to air space access, airports and aircraft noise. Today, NBAA is focused on issues such as aviation safety, operational efficiency, fair and equal access, FAA reform, noise and compatible land use, peak hour landing fees, reliever airports, air support, air traffic control modernization, product liability reform, research and development, business aviation advocacy and various tax issues.

For more information on becoming an NBAA member, see http://www.nbaa.org

Nothing contained in the foregoing should be relied upon as legal advice appropriate to your situation which can only be given by your own legal counsel.

IS YOUR NEW AIRCRAFT BEING SENT OUTSIDE THE USA FOR COMPLETION AT YEAR-END?

stewart — Sun, 18 Dec 2011 16:59:08 +0000

IS YOUR NEW AIRCRAFT BEING SENT OUTSIDE THE USA FOR COMPLETION AT YEAR-END?

Many clients find advantages in acquiring title to “green” aircraft before the end of the year but are unaware of potential pitfalls that could impact the tax depreciation benefits on their lease financing. Green aircraft are aircraft that are delivered from the manufacturer but have not been completed. Typically, an aircraft that has not been painted possesses a “green” tint, hence the moniker.

Lease Financing

When a client purchases an aircraft by way of lease financing, the lease contains certain restrictions and covenants regarding its operation. One of the most common restrictions includes limiting the aircraft’s use outside of the United States. This restriction is most often related to ensuring that the financing company is eligible to receive federal tax depreciation benefits. In fact, many times favorable terms of lease financing are directly related to the ability of the financing company to receive depreciation. What happens if the primary assumptions underlying the depreciation conclusions that the lessor reached are violated and no one in the room saw the issue coming? Indemnities contained in the lease require that the lessee indemnify the lessor for the lost tax benefits.

Before the closing on a new aircraft, the issue of putting the aircraft “in service” by conducting a business flight is normally discussed among the working group. In the case of a leased aircraft, the aircraft is placed “in service” once the lessor has entered into a lease with its lessee. But the analysis should not end there. Depending on the manufacturer, completion of the green aircraft may occur outside the United States. If the aircraft delivers green in December, and is immediately taken outside the USA for completion work, it is entirely possible that the aircraft will spend the majority (50%+) of its time during the tax year outside the USA, resulting not only in a violation of the lease covenant to operate the aircraft “predominantly” in the USA, but where there is bonus depreciation in play, a risk that depreciation cannot be taken.

What to do?

It is imperative that the transaction working group focus on not only the location of closing but the location of the aircraft between closing and the end of the year. If possible, you should include a provision in your purchase agreement that commits the manufacturer to keep the aircraft in the USA for more than 50% of the number of days between closing and the end of the year before it takes the aircraft out of the country for completion. We have found that manufacturers are amenable to such arrangements (it is unlikely that much work will be done the last 10 days of the year on a newly delivered aircraft anyway).

Nothing contained in the foregoing should be relied upon as legal advice appropriate to your situation which can only be given by your own legal counsel.

AMERICAN JOBS ACT COULD CHANGE DEPRECIATION SCHEDULE

stewart — Sun, 18 Dec 2011 16:57:17 +0000

AMERICAN JOBS ACT WOULD CHANGE DEPRECIATION

SCHEDULE FOR GENERAL AVIATION AIRCRAFT

The much-hyped jobs plan (American Jobs Act) by President Obama was revealed to Congress last week. While we will not debate the potential economic benefits of his plan, how he plans to pay for it is of concern to current and potential owners of general aviation aircraft. The American Jobs Act carries a price tag of over $400 billion dollars will be paid for by a combination of various tax increases, one of which is a modification of the depreciation schedule for general aviation aircraft (or if you are a politician the “corporate jet loophole”). General aviation aircraft are currently depreciated over 5 years using the Modified Accelerated Cost Recovery System. This will be extended to 7 years consistent with the depreciation schedule of commercial aircraft (see below). This change is only expected to yield $3 billion dollars over ten (10) years! To oppose the proposal, you can of course contact your representatives or support the efforts of the National Business Aviation Association (www.nbaa.org).

SEC. 421. GENERAL AVIATION AIRCRAFT TREATED AS 7-YEAR PROPERTY.(a) IN GENERAL. —Subparagraph (C) of section 168(e)(3) of the Internal Revenue Code of 1986 (relating to classification of certain property) is amended by striking “and” at the end of clause (iv), by redesignating clause (v) as clause (vi), and by inserting after clause (iv) the following new clause:“(v) any general aviation aircraft, and”.(b) Class life. Paragraph (3) of section 168(g) Internal Revenue Code of 1986 is amended by inserting after subparagraph (E) the following new subparagraph:“(F) General aviation aircraft. In the case of any general aviation aircraft, the recovery period used for purposes of paragraph (2) shall be 12 years.”.(c) General aviation aircraft.–Subsection (i) of section 168 Internal Revenue Code of 1986 is amended by inserting after paragraph (19) the following new paragraph:“(20) General aviation aircraft.–The term `general aviation aircraft’ means any airplane or helicopter (including airframes and engines) not used in commercial or contract carrying of passengers or freight, but which primarily engages in the carrying of passengers.”.(d) Effective date. This section shall be effective for property placed in service after December 31, 2012.

2011 Aircraft Registration Conference – Aviation Transactions in Transition

stewart — Tue, 04 Jan 2011 23:29:48 +0000

The 2011 Aircraft Registration Conference presented by NBAA will be held in Naples, Florida on February 3-4, 2011 at the Naples Grande Beach Resort. The conference will focus on “transition”, that is, changes in the way aircraft transactions are done, including some new trends. Stewart will be speaking on the topic of Offers to Purchase in Transition, and related matters such as commonly negotiated terms and the perspective of different players in the transaction. The seminar is not being given at an introductory level, but rather for those already experienced with aviation transactions.

Please join us. Regards. SHL.

2011 Aircraft Registration Conference Brochure

South Florida’s Best Lawyers

stewart — Fri, 12 Nov 2010 14:01:38 +0000

The firm is pleased to announce that Stewart has been included in the ALM publication of South Florida’s Best Lawyers (2011 edition) in the area of Corporate Law – Aviation Law.

Don’t miss the next episode of Plane Talk Radio which will air live at 12:30pm Eastern on Tuesday, November 16, 2010. PTR’s guests will be Gary Garofalo, Esq. and Barbara Spoor, a member of the board of directors of the National Aircraft Finance Association. We will be discussing current developments in FAA regulations and aircraft finance. The show can be reached through www.blogtalkradio.com/planetalkradio.

Please join us!

Premiere of Plane Talk Radio

stewart — Wed, 13 Oct 2010 19:28:33 +0000

Just a reminder to join us for the premiere of PlaneTalkRadio on October 14, 2010 at 12:30pm Eastern, hosted by Stewart Lapayowker!

http://www.blogtalkradio.com/planetalkradio

Stewart Lapayowker selected for inclusion in 2011 edition of The Best Lawyers in America

stewart — Mon, 16 Aug 2010 15:42:15 +0000

Stewart Lapayowker was selected for inclusion in the 2011 edition of The Best Lawyers in America the areas of Corporate Law and Transportation Law.