From: Jeffrey Epstein <[email protected]> Sent: Tuesday, September 17, 2013 9:05 PM To: Thomas Turrin Subject: Re: PRO-FORMA TAX TREATMENT - AIRCRAFT OPERATION i belive the aircraf excise tax issue changed in may pl=ase research. nbaa might help Cr> On Tue, Sep 17, 2013 at 4:40 PM, Thomas Turri= <[email protected] <mailto:[email protected]» wrote: Jeffrey, The attached schedule of pro-forma tax treatment is =aced on actual year 2012 activity and assumes the aircraft was placed in service on Jan 1st= 2012 and was Part 135 for the whole year. Included in the schedule is the amount of US excise =ax on the gross revenue (including revenue from business and "personal" use). Under Part 1=5, my understanding is that all of the "revenue" (including personal use) is subject to 7.5% US excis= tax (per discussion with Pat Fenn at Akin Gump and based on my own research). <=p> I calculated the loss using bonus depreciation (50%)=and without bonus depreciation. The operation of the aircraft would be characterized=as a passive activity on Leon's return. Leon would not be able to claim that he is materiall= participating in an active trade or business with respect to the aircraft operation (IRC=Code Sec 469). The loss would be deductible to the extent of Leon's income from other passive activit=es. Passive activity income does not include portfolio i=come from interest, dividends and capital gains. Passive activity income is typi=ally real estate rental income as well EFTA_R1_01745604 EFTA02574614