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02 / 22 / 24
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- Written by Angela Bryson
The IRS Begins an Initiative to Audit Tax Deductions for Corporate Jet Travel
The Internal Revenue Service has plans to ramp up enforcement efforts against Taxpayers that have abused the United States Tax Code by deducting millions of dollars on their taxes for corporate jet expenses that were sometimes used for personal travel through audits.
The tax code allows a business to deduct the cost of maintaining a corporate jet so long as it is used for business purposes. 2017 legislation also allowed for a deduction of the full cost of an airplane in the first year of ownership.
The IRS has allocated some of its $80 billion provided to them under the Inflation Reduction Act to develop new data analytics tools. These tools will be used to determine when company officials might have used corporate planes for private trips. The audits will likely extend to both corporations that own the planes and passengers.
“These aircraft audits will help ensure high-income groups aren’t flying under the radar with their tax responsibilities,” says IRS Commissioner Daniel Werfel. The IRS plans to focus their audit efforts on large corporations, partnerships, and wealthy Taxpayers, which is in line with their pledge to help close the “tax gap” of approximately $700 billion per year by proceeding with more audits of companies and high-income Taxpayers.
Contact us today to speak with a tax audit attorney.
