Although used primarily for business purposes, almost all corporations make the corporate aircraft available to their top executives for limited personal trips and, in case of helicopters, for commuting.
Many executives even receive continued personal use as part of their retirement packages.
These expenses include jet fuel, excise taxes, pilot salaries, depreciation, airport user fees, maintenance, etc. Obviously, the cost associated with each use of the aircraft can be quite significant. The proper tax treatment becomes muddied whenever an aircraft is flown solely for personal reasons or for mixed business and personal reasons such as where an executive is required to fly on the aircraft for security reasons. Most corporations have implemented corporate aircraft policies that address many, but typically not all, of the competing tax considerations. Nevertheless, we suspect that each corporation is well aware of one of the key rules related to the personal use of the corporate aircraft by an executive, a family member or a friend, i.e., the executive does not have to include the entire fair market value of the trip as gross income.