Surtax on any liquid used in a fractional ownership program aircraft as fuel(p11)

Fuel used in a fractional ownership program aircraft (as defined below) after March 31, 2012, is subject to a surtax of $.141 per gallon. The fractional ownership program manager is liable for the tax. The surtax applies in addition to any other taxes imposed on the removal, entry, use, or sale of the fuel. If the surtax is imposed, the following air transportation taxes do not apply.

• Transportation of persons by air.
• Transportation of property by air.
• Use of international air travel facilities.

These taxes are described under Air Transportation Taxes, later.

A fractional ownership program aircraft flight is considered noncommercial aviation, for the rules for kerosene used in noncommercial aviation, see Kerosene for Use in Aviation, above.

is a program under which:

• A single fractional ownership program manager provides fractional ownership program management services on behalf of the fractional owners;
• There are one or more fractional owners per fractional program aircraft, with at least one fractional program aircraft having more than one owner;
• For at least two fractional program aircraft, none of the ownership interests in the aircraft are less than the minimum fractional ownership interest or held by the program manager;
• There exists a dry-lease aircraft exchange arrangement among all of the fractional owners; and
• There are multi-year program agreements covering the fractional ownership, fractional ownership program management services, and dry-lease aircraft exchange aspects of the program.

Any aircraft that, in any fractional ownership aircraft program, is listed as a fractional program aircraft in the management specifications issued to the manager of such program by Federal Aviation Administration under subpart K of part 91 title 14, Code of Federal Regulations, and is registered in the U.S.

Fractional program aircraft are not considered used for transportation of a qualified fractional owner, or on account of such qualified fractional owner when they are used for flight demonstration, maintenance or crew training. In such situations, the flight is not commercial aviation. Instead, the tax on the fuel used in the flight is imposed at the non-commercial aviation rate.

Any person owning any interest (including the entire interest) in a fractional program aircraft.

An agreement, documented by the written program agreements, under which the fractional program aircraft are available, on an as-needed basis without crew, to each fractional owner.

A fractional program aircraft will not be considered to be used on account of a qualified fractional owner when it is used in deadhead service and a person other than a qualified fractional owner is separately charged for such service.

See section 4043 for more information on the surtax.