Kerry Lynch stepped into the role of editor of the&nbsp;Aviation International News&nbsp;monthly magazine in May 2022 after serving with&nbsp;AIN&nbsp;for eight years. She joined&nbsp;AIN&nbsp;in December 2014 as a senior editor covering Washington and business aviation news. She has also served on Convention News teams, including as editor of&nbsp;HAI Convention News. Lynch previously spent 25 years with Aviation Week. During her time there, she reported for and later steered&nbsp;The Weekly of Business Aviation, oversaw business aviation content on the&nbsp;Aviation Week Intelligence Network, served on the&nbsp;Show News&nbsp;staff, and held roles as the Washington columnist for&nbsp;Business &amp; Commercial Aviation&nbsp;and&nbsp;Overhaul &amp; Maintenance&nbsp;monthly magazines. In 2021 she was honored with the National Business Aviation Association Platinum Wing Award for lifetime achievement in journalism and was the 2004 recipient of the National Air Transportation Association’s Aviation Journalism Excellence Award. She also has been a recipient of an Aerospace Media Award for business aviation (2022) and NBAA Gold Wing Award (2003, 2024). Lynch graduated from The Ohio State University with a bachelor of arts in journalism.

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Kerry Lynch

The U.S. Supreme Court has given the Internal Revenue Service until April 19 to respond to Bombardier’s request for review of its case over the taxation of management fees.


Bombardier on February 19 asked the Supreme Court to review its case, contending that the IRS inappropriately assessed commercial air transportation federal excise taxes to management fees charged by Flexjet, its former fractional operation.


The company turned to the Supreme Court after the U.S. Court of Appeals for the Fifth Circuit denied Bombardier’s request for a full-court, or en banc, review of its case against the IRS. A three-judge panel at the Fifth Circuit had previously agreed with a lower court ruling that the IRS properly taxed fractional operation management fees as commercial air transportation activities.


Bombardier argued that the Appeals Court decision conflicts with past Supreme Court and other court findings, and said a review is necessary to “clarify important tax rules governing the aviation industry and to reaffirm that the IRS must provide clear, non-speculative and uniform guidance to tax collectors before it may hold them secondarily liable for uncollected taxes.”


Both the National Air Transportation Association (NATA) and NBAA <a href="https://www.ainonline.com/aviation-news/business-aviation/2017-03-20/bizav-groups-back-bombardier-supreme-court-challenge">have backed Bombardier’s lawsuit </a>with amicus briefs that echoed those arguments, noting that the IRS has provided inconsistent rulings. The Appeals Court decision further creates an unfair competitive situation, since NetJets is not required to collect the tax, the associations added.


The case also has drawn an amicus brief from Flexjet’s current sister company, Flight Options, and fractional operator PlaneSense.


The fractional operators were filing the brief, the companies told the court, “because the IRS has failed to provide clear and non-speculative notice to companies in the industry of their tax collection.”


The companies further echoed arguments that the IRS has provided conflicting guidance and treated competing companies in the same industry differently. “This unfair and disparate treatment gives preferential treatment to select companies in the industry, while refusing to afford similar treatment to others in the same industry,” the PlaneSense and Flight Options brief contends. “Though PlaneSense is a beneficiary of the disparate treatment in the short term, it is, together with the industry as a whole, at a long-term disadvantage because of the unclear and contradictory guidance provided by the IRS.”


Since Bombardier’s case involves management fees associated with fractional operations, it is separate from the industry’s quest for clear guidance over the tax treatment of fees involved in whole aircraft management operations. But, Scott O’Brien, senior manager of finance and tax policy at NBAA, notes, “In my view, it is generally bad for our industry to be in a position where management fees [that don’t involve movement of the aircraft] are subject to air transportation excise taxes.”


The IRS has been working on guidance on whole aircraft management fees for the past several years, but progress has been so slow that industry leaders believe that Congress may ultimately need to address the issue.

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