What constitutes "business use"


#1

I want to fly between my employers several locations in the midwest, instead of driving. My employer will not allow this - preferring I spend 10 hours in a car instead of 3 hours in an airplane (Cirrus SR20). My position is that it is NOT flying for business - anymore that my driving would be driving for business. It is simply a mode of transportation. I am not compensated to fly - and I only plan to fly myself - no other execs or employees. Their obvious concern is liability should an accident occur. I’m not even asking for flying expense reimbursement - rather, I would put the standard vehicle milage on my expense report. It’s worth it to me to save the time and be more productive.

Any thoughts or perhaps actual situations anyone can cite to help me convince them? Should something happen, would the courts agree that this is “flying for business”?


#2

For me, in my prior job working for the gubment, the gubment’s position was exactly like yours. I got to use my plane for “commuting” and I was re-imbursed based on privately owned airplane rates (POA $1.08 per mile) vs privately owned vehicle (POV was 48 cents per mile). My longest trip on a regular basis by car was about 5 hours one way, in my Sundowner, was 1.25 hours one way, so in my case, time is money.

I did have to do a cost comparison for my shorter commutes to be sure it was cheaper for the gubment to pay me to fly my own airplane vs staying overnight, per diem and car mileage. For my longer commutes, it was a no brainer, it was invariably cheaper for me to fly by about $75.00 per trip, plus I got to sleep in my own bed that evening.

I think though with private companies, there may be a “liability” issue that makes them balk at you using your airplane for commuting purposes. At least in other aviation forums where this comes up, seems that the word liability, workers compensation should something happen and insurance always crops up in discussions of this nature.

I do know if an accident happened during the commute whether it be by car or by plane, and it was “work related” (not to and from home OUTSIDE your working hours) then workers compensation will be the primary payer as you are flying (or driving) for business (not in a commercial license sense but a commuting sense).

Allen


#3

Simplistically, how would they stop you?

Unless they’re willing to fire you over the matter, ignore them. How is their liability any greater if you die in a plane crash than in a car crash? It’s not.

It’s not flying for business, it’s simply transportation.

But, don’t fall into the trap of “Just drop this widget mold off at the chief engineer’s office in the Moline plant when you get there”.


#4

There are a few things you can do. First is to add your company as a “named insured” on your aviation insurance policy (it’s free). Second is to meet with the head of risk management (or whoever makes these decisions about employee risks to your company) and discuss what his/her real concerns are. You can also offer to sign an waiver agreement waiver claims of liability against them for aviation accidents that happen when you travel on business. My experience is that it is mostly fear of the unknown, with a dash of ‘small airplanes are inherently dangerous’, that risk managers are responding to. You might point out that many companies routinely fly people on business in small planes, and not just corporate jets. If you can get them comfortable with you and your safety record, you may be able to convince them to allow you to fly.


#5

All good advice and very helpful - thanks guys!

Re: JHEM’s comments - I agree - Having been on board for only 6 months - and reporting to the President/CEO - I’m trying to play by the rules for now. However, I can’t rule out “flying to visit a friend - who just happens to live in the same city as our remote facility”. Ironically, I suddenly have “friends” in all the cities where we have plants. :slight_smile:

Again - thanks!


#6

Doesn’t sound like you would have this problem, but running afoul of FAR 135 needs to be looked at.


#7

They do have one legitimate issue. If you fly your plane on business and crash it into a retirement home, there will be several litigators looking around for deep pockets. They will quickly go after the insurance company and you personally. Then, if they figure things out, they will say, “Oh, he was flying on business, let’s go after the company too. If not for the company, this would not have happened” The jurors watching the parade of crying relatives who just lost their beloved (so why was she in the retirement home and not living with them?) grandmother may decide that the faceless company can help make these suffering people feel better by giving them a bunch of the company’s money.

No, it is no different if you crash your car into the retirement home while driving somewhere on business, but the perceived risk of an airplane falling out of the sky is higher.


#8

But the perception of increased risk doesn’t change the potential liability one iota!

For the OP, it’s far easier to ask forgiveness than to receive permission. (R Adm Grace Murray Hopper, USNR)


#9

If it’s strictly for “commuting” where would 135 come into play?

He was going there no matter what, and from what all I understand, if he was going there anyway, not being paid for flying.

At least that’s how I perceived it for my situation (and what pesslinger asked) when I commuted office to office.

BTW, the federal POA rate was much more then fuel cost, though that also includes the cost of maintenance such as oil changes (same as cars), so in reality, I saw more in my pocket then the short term expense of fuel only.

Good example would be from KMBO to KCRX was 166 nm one way.

I burn about 9.5 gallons an hour, and using $4.00 per gallon (average cost when I was flying, it amounted to average of $108 round trip, yet I would get paid by the mile which would be an average of $358 reimbursement.

Allen


#10

‘lieberma’ - you understand correctly. I do fly part 135 parttime for a freight operator - but see no way that part 135 comes into play for my desired commute.

Are there published POA rates out there that I could find?


#11

I was a penny off on memory in my prior post :confused: . It’s 1.07 per mile.

gsa.gov/Portal/gsa/ep/conten … =GSA_BASIC


#12

As I said, it doesn’t sound like he would have that problem. But get a reimbursement check for one cent more than actual expenses…

A little off topic but don’t forget the IRS and FAA have a different view on $$$. Take for instance SIFL charges when a spouse rides on the company airplane. The person in question can write a check to the company as far as the IRS is concerned, but the FAA says that makes it a commercial operation. So, for strictly part 91 operators the person subject to SIFL charges (or the persons spouse if he/she is the employee) gets their W2 ramped up by the appropriate amount, no money changes hands, so no FAA problem.


#13

The next interesting question is what constitutes “actual expenses”. It could be fuel only at one extreme or, at the other extreme fuel plus a pro rata (hourly) portion of all costs of flying including insurance, hanger, training costs, maintenance, subscriptions, ad infinitum.


#14

I was going to be happy just to be able to fly, and get the standard automobile milage. :smiley:

I gotta’ tell ya’ - as you can see, this was my first post here, even tho’ I’ve been around for a year and a half - and I’m overwhelmed at how quickly several people responded with helpful advice. Great group!


#15

To further expand as I think you are implying above, when would that expense have to be incurred whether it be directly related to that flight (such as fuel) or an expense that would relate to that flight?? (such as oil / oil changes).

My take when I was commuting, if the feds were paying me 1.07 per mile, and factoring in maintenance expense (just like a car) then I am not being reimbursed any more then what I pay for fuel and maintenance (again, just like a car). The reimbursements were designed for both fuel and maintenance from what I understood. I could have even claimed a rental car.

I was also allowed to claim handling fees, tie down fees and such but never encountered that as long as I fueled up. Landing fees would have been reimbursable too but I never encountered that in my travels.

For me, it wasn’t the immediate expense at hand, so I saw a couple hundred dollars in my pocket BEFORE the oil change and associated costs ate that up. :open_mouth:

But hey, inspite any expenses incurred, I had the best view of the house during rush hour! :stuck_out_tongue:


#16

It would come into play if he was reimbursed and fell afoul of my previously mentioned nice guy award for carrying that widget mockup.

Just like adding parking and tolls to the mileage allowed on a car.

As Porterjet pointed out (although the example isn’t applicable), don’t even THINK about taking money from a passenger on one of these jaunts! You’d just be unnecessarily opening a can of FAA/IRS worms.


#17

You can use the “common purpose” part of the regs to share expenses with a passenger. If you are getting $1.07 per mile for ‘driving’ expenses and half of the fuel costs from a passenger sharing the ride, you’d really have the FAA accountants in an interesting place.


#18

I thought that he would be precluded from accepting any payment from a passenger if he were being reimbursed by his employer. No?


#19

Reminds me of that old accountant joke. When the CEO interviewed the accountant and asked what 2+2 equals, he looked at the CEO and said, “what do you want it to be?”

I think this is the current version of the relevant FAR: 61.113c: A private pilot may not pay less than the pro rata share of the operating expenses of a flight with passengers, provided the expenses involve only fuel, oil, airport expenditures, or rental fees.

So, if you have your plane in an LLC that rents out the fully loaded costs of the plane (hanger, insurance, etc.) to the owners of the LLC, then you would could argue that you are complying with this. If the company were reimbursing for a part of that total, you could theoretically share the rest with the passenger.


#20

That would be my take on it from the FAA point of view.

My employer of past would have cared less. It would be no different then a passenger hitching a ride in my car to a distant city, and they offered 1/2 the fuel cost, would I turn down some “free” fuel if they offered to pay for a tank. Heck no!

The reimbursement pays for my entire expenses whether it be POV or POA, and anything beyond that would be more then my share.

Now IMHO, if somebody was to offer me 1/2 the cost, I’d get them to pay the fuel directly to the FBO or better yet, seek self serve service so the fuel wouldn’t be tied to a tail number…

How they spend their money is their biz and they pick up the tab and I happen to walk in to pay and the FBO said paid in full, “out of sight, out of mind”.

I would slink out graciously and say thank you fuel Gods :slight_smile: