I Need help with LLC and leaseback..

myron96

Well-Known Member
Just curious if anyone here has any aircraft on leaseback and if so how are you doing it, ie..LLC or the like. I have a sweet plane in mind for leaseback, have the money, now just need to find out the specifics. I'm thinking LLC if that is possible for the tax benefits, but until I talk to a lawyer/tax guy I dont know too much about it. Any info would be greatly appreciated. Also, if anyone knows a good lawyer/accountant in the MD/DC area I could talk to that would be great.
Thanks!
 
I leased back two airplanes at one time. Starting an LLC is a relatively easy thing to do. We never needed a lawyer. There are more than enough easy to read books out there on how to do it in whatever state you live. Incorporating in Nevada or Vermont or wherever is a waste of time. If the airplane is not going to be in your home state you'll need to have a registered agent in that state. You can usually find an accountant that will be one.
Try looking at Legal Zoom. They have all the paperwork you'll need. If you have a school/flight club in mind they'll have a generic contract in place. If they're professional it will be a straight to the point document. X amount of dollars per hour, X amount for mtx., X amount for fuel. Amount of time they give to terminate said contract. If it's a busy flight school you can set the maximum number of hours the plane can fly-it can fly too much!
I do recommend buying a book on LLC's and reading up on it.
For the years we had the airplane it was easy, straight forward and rewarding.
Good luck!
 
Thanks for the reply! Out of curiousity, assuming you can write off business expenses, can you also write off the monthly loan payment for the plane?
 
Thanks for the reply! Out of curiousity, assuming you can write off business expenses, can you also write off the monthly loan payment for the plane?

You can only write off the interest you pay on the loan, not the entire loan payment. You can also write off any expense directly related to the operation of the aircraft: insurance, maintenance, parking, management fees, gas (unless you rent it dry), oil, etc. The fees you'll pay to start your company are deductable as well, but you'll have to spread them out over several years.
 
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