The American Paradise: Using a Tax-Free U.S. Virgin Islands Exempt Company for FAA Registration of Foreign-Owned Aircraft

Are you a non-U.S. person (individual or entity) who wishes to purchase an aircraft to be registered by the FAA in the United States? Under federal law, foreigners are not allowed to register aircraft in the United States – but structures have existed for decades that the FAA will accept and which will solve this problem for most owners. Usually these structures involve Delaware corporations or similar entities formed in other states – but these entities are subject to U.S. income taxes. The only entity that qualifies for FAA registration but that is not subject to federal tax is the USVI exempt company. This article by Solomon Blum Heymann partner William L. Blum and former Virgin Islands Bureau of Internal Revenue Chief Counsel Marjorie Roberts explains the structure and how to establish and use this type of entity.

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