EFTA02574614.pdf

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 as other trade or business income from business acti=ities in which the taxpayer is not a material participant. <1=> As a passive activity, the losses not currently dedu=tible against current passive income would not be lost —but would be carried forward as=("suspended") and would offset passive income in future years including income from future disposa= of the aircraft - mostly recapture of depreciation. Once the aircraft is officially Part 135 (lawyers sa= should be soon), Avioneta Holdings, LLC would become an aircraft business with the aircraft =A0"placed in service" for depreciation purposes. I'm available to discuss. Best, Tom THOMAS TURRIN, CPA</=> Partner Raich Ende Malter & =o. LLP New York, New York =0018 2 EFTA_R1_01745605 EFTA02574615  Email: Website: www.rem-co.com</=> =A0 CONFIDENTIALITY STATEMENT: The information contained in this elect=onic communication, including any and all attachments and enclosures, may be privileged and is strictly confidential, intended s=lely for the use of the person(s) identified above to receive this communi=ation. If you are not the person(s) identified above to receive this commu=ication, you are hereby notified that you may not disclose print, copy, disseminate, or otherwise use the i=formation contained herein. If you are an employee or agent of the person(=) identified above to receive this communication and, as such, you have been authorized to deliver this communication to such person(s), you may disclose, print, copy, disseminate, or otherwis= use the information contained in this communication solely for the purpos= of such delivery. Unauthorized interception and/or use of this communicat=on are/is strictly prohibited and may be punishable by law. If you have received this communication in error= please reply and notify the sender (only) of that fact and delete the com=unication, including any and all attachments and enclosures, from your com=uter or other electronic device on which you may have received this communication. CIRCULAR 230 DISCLOSURE: =/font> To insure compliance with requirements imposed by the Internal =evenue Service, we inform you that any tax advice contained in this communication (including any and all attachments), unles= expressly stated otherwise, was not intended or written to be used and ca=not be used for the purpose of (i) avoiding tax-related penalties imposed =y the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transactio=(s) or tax- related matter(s) addressed herein. This communication may not =e forwarded (other than to the addressee(s) identified above) without our =xpress written consent. The information contained in this c=mmunication is confidential, may be attorney-client privileged, may constitute inside information, and is intended only for the use of the a=dressee. It is the property of Jeffrey Epstein Unauthorized use, di=closure or copying of this communication or any part thereof is strictl= prohibited and may be unlawful. If you have received this communication in error, p=ease notify us immediately by return e-mail or by e-mail to 3 EFTA_R1_01745606 EFTA02574616 [email protected], =nd destroy this communication and all copies thereof, including all attachm=nts. copyright -all rights reserved 4 EFTA_R1_01745607 EFTA02574617