West Virginia Code of State Rules › Agency 110 - Tax › Title 110 - LEGISLATIVE RULE STATE TAX DEPARTMENT › Series 110-15K - Aircraft Operated Under A Fractional Ownership Program › Section 110-15K-2 - Definitions

Current through Register Vol. XLI, No. 28, July 12, 2024
2.1. Terms used in
				this legislative rule or in the administration and enforcement of the sales tax
				exemption authorized by §11-15-9p of this
				code, and not otherwise defined in this rule or §11-15-1, e
t seq.
,
				§11-15A-1,
et seq.
, or §11-15B-1,
et
				seq.
of the West Virginia Code, shall have the meanings ascribed to
				them in Subpart K of 14 C.F.R. 91, as amended, related to Fractional Ownership
				Operations.
2.2. As used in this
				rule:
2.2.a. "Affiliate" of a program manager
				means a manager that, directly, or indirectly, through one or more
				intermediaries, controls, is controlled by, or is under common control with,
				another program manager. The holding of at least forty percent (40 percent) of
				the equity and forty percent (40 percent) of the voting power of an entity will
				be presumed to constitute control for purposes of determining an affiliation
				under this Rule.
2.2.b. "Directly
				used or consumed," in the context of repair, remodeling or maintenance of
				aircraft, aircraft engines or aircraft component parts for an aircraft operated
				under a fractional ownership program, shall mean used or consumed in those
				activities which constitute an integral and essential part of such activities,
				as contrasted with and distinguished from those activities which are simply
				incidental, convenient or remote to such activities.
2.2.b.1. Sales of machinery, tools or
				equipment directly used or consumed exclusively in the repair, remodeling or
				maintenance of aircraft, aircraft engines or aircraft component parts for an
				aircraft operated under a fractional ownership program shall include only:
2.2.b.1.A. Machinery, tools or equipment
				physically incorporated into the finished aircraft operated under a fractional
				ownership program, or physically incorporated into the finished aircraft engine
				or aircraft component part on an aircraft operated under a fractional ownership
				program, as a result of repair, remodeling or maintenance activities;
2.2.b.1.B. Machinery, tools or equipment used
				exclusively for repairing, remodeling or maintaining aircraft operated under a
				fractional ownership program; or
2.2.b.1.C. Machinery, tools or equipment used
				exclusively for repairing, remodeling or maintaining aircraft operated under a
				fractional ownership program and aircraft that qualifies for the exemption
				under §11-15-9(a)(33) of
				the West Virginia Code.
2.2.c. A "dry-lease aircraft exchange" means
				an arrangement, documented by the written program agreements, under which the
				program aircraft are available, on an as-needed basis without crew, to each
				fractional owner, as provided in Subpart K of 14 C.F.R. 91, as
				amended.
2.2.d. A "fractional
				owner" or "owner" means an individual or entity that possesses a minimum
				fractional ownership interest in a program aircraft and that has entered into
				the applicable program agreements; provided, however, that in the case of the
				flight operations described in paragraph 2.2.g.3of this rule, and solely for
				purposes of requirements pertaining to those flight operations, the fractional
				owner operating the aircraft will be deemed to be a fractional owner in the
				program managed by the affiliate.
2.2.e. A "fractional ownership interest"
				means the ownership of an interest or holding of a multi-year leasehold
				interest or a multi-year leasehold interest that is convertible into an
				ownership interest in a program aircraft.
2.2.f. A "fractional ownership program" means
				any system of aircraft ownership and exchange that consists of all of the
				following:
2.2.f.1. The provision of
				fractional ownership program management services by a single fractional
				ownership program manager on behalf of the fractional owners;
2.2.f.2. Two or more airworthy
				aircraft;
2.2.f.3. One or more
				fractional owners per program aircraft, with at least one program aircraft
				having more than one owner;
2.2.f.4. Possession of at least a minimum
				fractional ownership interest in one or more program aircraft by each
				fractional owner;
2.2.f.5. A
				dry-lease aircraft exchange arrangement among all of the fractional owners;
				and
2.2.f.6. Multi-year program
				agreements covering the fractional ownership, fractional ownership program
				management services, and dry-lease aircraft exchange aspects of the
				program.
2.2.g. A
				"fractional ownership program aircraft" or "program aircraft" means:
2.2.g.1. An aircraft in which a fractional
				owner has a minimal fractional ownership interest and that has been included in
				the dry-lease aircraft exchange pursuant to the program agreements;
2.2.g.2. An aircraft owned in whole or in
				part by the program manager that has been included in the dry-lease aircraft
				exchange and is used to supplement program operations, or
2.2.g.3. In the case of a fractional owner
				from one program operating an aircraft in a different fractional ownership
				program managed by an affiliate of the operating owner's program manager, the
				aircraft being operated by the fractional owner, so long as the aircraft is:
2.2.g.3.A. Included in the fractional
				ownership program managed by the affiliate of the operating owner's program
				manager, and
2.2.g.3.B. Included in
				the operating owner's program's dry-lease aircraft exchange pursuant to the
				program agreements of the operating owner's program.
2.2.h. "Fractional ownership
				program management services" or "program management services" mean
				administrative and aviation support services furnished in accordance with the
				applicable requirements of Subpart K of 14 C.F.R. 91, as amended, or provided
				by the program manager on behalf of the fractional owners, including, but not
				limited to:
2.2.h.1. Establishment and
				implementation of program safety guidelines;
2.2.h.2. Employment, furnishing, or
				contracting of pilots and other crewmembers;
2.2.h.3. Training and qualification of pilots
				and other crewmembers and personnel;
2.2.h.4. Scheduling and coordination of the
				program aircraft and crews;
2.2.h.5. Maintenance of program
				aircraft;
2.2.h.6. Satisfaction of
				recordkeeping requirements;
2.2.h.7. Development and use of a program
				operations manual and procedures; and
2.2.h.8. Application for and maintenance of
				management specifications and other authorizations and approvals.
2.2.i. A "minimum fractional
				ownership interest" means:
2.2.i.1. A
				fractional ownership interest equal to, or greater than, one-sixteenth (1/16)
				of at least one subsonic, fixed-wing or powered-lift program aircraft;
				or
2.2.i.2. A fractional ownership
				interest equal to, or greater than, one-thirty-second (1/32) of at least one
				rotorcraft program aircraft.
2.2.j. "Person" includes any state, and its
				political subdivisions or an agency of either, the State of West Virginia and
				its political subdivisions or an agency of either, and any individual, firm,
				partnership, joint venture, joint stock company, the government of the United
				States and its agencies, any public or private corporation, municipal
				corporation, cooperative, estate, trust, business trust, receiver, executor,
				administrator, any other fiduciary, any representative appointed by order of
				any court or otherwise acting on behalf of others, or any other group or
				combination acting as a unit, and the plural as well as the singular number of
				the entities here enumerated.
2.2.k. "Tax Commissioner" or "Commissioner"
				means the State Tax Commissioner of West Virginia or his or her
				delegate.