FAA Modernization and Reform Act of 2012 adds surtax for fuel used in fractional ownership programs

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On February 14, 2012, President Obama signed the FAA Modernization and Reform Act of 2012 (the Act), which creates IRC Section 4043 that imposes a new 14.1¢ per gallon surtax on general aviation jet fuel purchased and used in certain fractionally owned aircraft. In addition, the Act extends existing provisions, set to expire February 17, 2012, in the Internal Revenue Code that fund the Airport and Airway Trust Fund and related taxes through September 30, 2015. The amended provisions became effective on February 18, 2012, allowing for a seamless extension.

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