IRS issues guidance on new surtax on fuel used in fractional ownership programs

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The IRS recently issued Notice 2012-27 providing guidance relating to the application of the new surtax imposed by Section 4043 on fuel used in fractional ownership aircraft. Section 4043, created by the FAA Modernization and Reform Act of 2012, imposes a new 14.1¢ per gallon surtax on general aviation jet fuel purchased and used in certain fractionally owned aircraft. In general terms, a fractional ownership aircraft program is a system of aircraft ownership and exchange involving a single program manager that manages the fleet of aircraft on behalf of the fractional owners.


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