Frugal Pilots Offer More Tips

One of the best ways to fly more while spending less is shopping smart. Frugal pilots know this. But they don’t all realize how creative shopping smart can become.

Shopping Smart

Reader Dennis Martin of Menominee, Michigan is a creative frugal pilot. He reports “I recently overhauled the Lycoming O-360 in my Cessna 170B. It turned out that almost every part on the engine is PMA’d (FAA Parts Manufacturer Approval) by multiple sources, which really helps drive the costs down. Buying everything at one time from one source saved big on shipping. There is so much competition on things like cylinders that you can get BRAND NEW cylinder kits for about the same cost as overhauling/overboring. Also, it turns out that a cam kit with lifters and tappets was cheaper than buying the parts individually.” Buy a popular airplane and shop smart for parts.

Dennis admits that he is an A&P (airframe and powerplant) mechanic. “But even if I wasn’t, the disassembly and reassembly goes quick. The tedious (expensive) part is all the cleanup, parts wrangling, shipping, etc. – and you don’t need to be an A&P or even particularly handy to do that.” Dennis notes that you can inspect your own magnetos and save hundreds of dollars using the manuals available online as well as calling the manufacturer’s technical support. His second tip is to do as much of the work as you can yourself – A&P or not.

How much did frugal Dennis save? “I got a complete overhaul for a little over $10,000. That same engine sent out to a shop would be closer to $20,000.” One of the reasons for the higher price is that many FBO shops today crate the engine up and ship it out to a remanufacturer – one more step in an expensive process. And the difference in price will buy many tanksful of avgas.

Reducing Taxes

Another way to reduce flying costs is to pay less taxes. I am not advocating hiding your aircraft to avoid taxes – after all, some of the states and cities actually improve aviation with the money they collect from various taxes on aviation. Some do not. However, many government entities offer smart aircraft owners opportunities to legitimately reduce or eliminate their tax expense.

For example, in California and some other states, you can report your older (35+ year old) plane as an “Aircraft of Historical Importance.” If eligible, city or county personal property tax may be waved – if you comply with their requirements. That sometimes means that you show your aircraft at public events through the year, but that is just one more good excuse to go flying. As you can imagine, the local assessor’s office isn’t going to call up all area pilots to offer this exemption, so you’re going to have to do some calling to see what is available. You may find that your state leaves aircraft tax assessment to the county and they choose not to do it. Hangaring your aircraft at one airport may offer tax savings over another just a few miles away. You won’t know if you don’t ask. Your local or regional pilot’s association may already have done this homework.

Another example of reducing tax costs is to speak with a tax attorney as you buy or sell an aircraft. Many states require that you pay sales tax on the transaction value. The five states that currently don’t add sales tax to a purchase are Alaska, Delaware, Montana, New Hampshire, and Oregon. Others tax some purchases and not others. It can pay to find out.

Private and commercial aircraft sales may be treated differently in your state or municipality. Leases often have different taxation regulations than buying your wings. The National Business Aviation Association (NBAA.org) offers a free white paper on State Aviation Tax. Knowing how the sales or user tax system works where you live can save you many thousands of dollars as you purchase your next plane.

One more idea: Fuel tax paid may be an allowable deduction on your federal or state taxes. Again, talk with a tax expert – especially one who is a pilot.

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Need some more info? Visit http://www.aopa.org/Pilot-Resources/Aircraft-Ownership/The-Pilots-Guide-to-Taxes. It offers helpful facts on income tax, sales and use tax, and personal property tax as they relate to aircraft.

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