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nubpilot

Not a CT but looking for feedback

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Posted on https://sportpilottalk.com/ also.
 
I am looking to start flight training at a school which will be getting a Pipistrel Alpha Trainer soon. I have only flown an hour in a Kappa last year so don't have much to reference against.  Looking for anyone that has any experience in one.

The one the school will be getting is for sale and they would entertain a leaseback to the school with the new owner (maybe me). Secondly, does anyone have any recent experience with leasebacks. In my state, CT, this would the only LSA available for rent also which could open up some Private Pilots looking to fly without having to renew their medical.

Here is an example that I have seen regarding leasebacks:
- leaseback at a dry rate of $100\hr
- split 80\20 (80 to owner and 20 to school)
- Owner carries insurance and costs all maintenance costs
example - plane is rented (school or other) for 30 hours in a month. Owner would receive $2400 (30hrs * $80\hr) and out of that amount would be loan payment, insurance (monthly amount), hanger rental (if required), and any maintenance items (25 or 50hr oil change, 100hr condition inspection). Are there any other costs that I would be missing (I know about saving for engine overhaul or replacement)?

Advantage is that I would conduct all my own training in my plane and would only have a cost of fuel and instructor. Is this something realistically that could assist in paying for my training and maybe break even? I am not looking for this to be an income to the family, but as an opportunity to enjoy flying with the plane and be able to offset some of the costs of ownership?

Lately, if people have experience with this plane, what are some of the average costs regarding maintenance?

thanks for any feedback that you could provide either on the plane or the leaseback.
Jeremy
 

 

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Jeremy - Don't know to much on this topic, but you'll find people who do this don't set it up under their own name, it involves forming a LLC.  That leads to questions on what is tax rate on the income, and depreciation of the plane (buying a factory new one v/s a used plane may differ here, tax reg's change often). When you factor that in, and give up 20% off the top, I'd be confirming the expected revenue is way positive compared to the certain risks.  (LSA's are more delicate in terms of rental abuse)   I'd research those who do aviation LLC's, insurance carriers who have data willing to share some of that side, and visit with your favorite tax fella. 

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59 minutes ago, nubpilot said:

I have only flown an hour in a Kappa

Is that the Kappa that used to be based in Chester (KSNC)???  Sadly, the poor pilot took off on really bad grass at Goodspeed and took the gear off... I don't think it is coming back.

Nub, here is a great site about a guy in fairly remote Canada who makes his living in a Pipistrel... it is the same plane as the Trainer you are looking at, but for an extra 20 hp, different prop and some luxuries... 

https://www.youtube.com/channel/UCQSI13FFrsTisdb4cY5_TLg/videos?disable_polymer=1

I looked at buying a Pipistrel, it is a great plane in all respects, except one in my opinion... when I climbed in the cockpit at Sun n Fun a couple of years ago, I was surprised by the intrusion into my head space of the wing box... meaning, the wing box was too close to my head and I am only 6' tall... Moreover, I didn't like the fact that there was no hat shelf and rear window like the CTLS.  Finally, the FD Dealer was close to me here in CT (Woodstock CT)... so I bought a FD instead. 

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19 minutes ago, AGLyme said:

Is that the Kappa that used to be based in Chester (KSNC)???  Sadly, the poor pilot took off on really bad grass at Goodspeed and took the gear off... I don't think it is coming back.

Nub, here is a great site about a guy in fairly remote Canada who makes his living in a Pipistrel... it is the same plane as the Trainer you are looking at, but for an extra 20 hp, different prop and some luxuries... 

https://www.youtube.com/channel/UCQSI13FFrsTisdb4cY5_TLg/videos?disable_polymer=1

I looked at buying a Pipistrel, it is a great plane in all respects, except one in my opinion... when I climbed in the cockpit at Sun n Fun a couple of years ago, I was surprised by the intrusion into my head space of the wing box... meaning, the wing box was too close to my head and I am only 6' tall... Moreover, I didn't like the fact that there was no hat shelf and rear window like the CTLS.  Finally, the FD Dealer was close to me here in CT (Woodstock CT)... so I bought a FD instead. 

Andrew,

that's the one, great instructor but unfortunately I couldn't fly in his Cub due to weight limitations.  I think the CTLSi would fit my mission perfectly, but unfortunately don't have the means of owning one outright.  This Pipistrel Alpha kind of fell into place as I was attending their free ground school and have been in contact with their chief instructor the past few weeks.  I will have to make sure to evaluate the comfort level of the Alpha, but don't think this is going to be my forever plane as I'd love to build an RV-12 at some point.  first things first and I have to get my Sport Pilot certificate.  Ultimately, I'd like to become a CFI-S at some point and could use the Alpha for instruction if things fall through with the leaseback to the school.

thanks for your feedback about the plane.

Jeremy

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1 hour ago, GrassStripFlyBoy said:

Jeremy - Don't know to much on this topic, but you'll find people who do this don't set it up under their own name, it involves forming a LLC.  That leads to questions on what is tax rate on the income, and depreciation of the plane (buying a factory new one v/s a used plane may differ here, tax reg's change often). When you factor that in, and give up 20% off the top, I'd be confirming the expected revenue is way positive compared to the certain risks.  (LSA's are more delicate in terms of rental abuse)   I'd research those who do aviation LLC's, insurance carriers who have data willing to share some of that side, and visit with your favorite tax fella. 

I've thought about the differences between owning it myself or should I create an LLC and they own it.  I will make sure I discuss it with a tax person specifically if there is some level of income.

thanks

Jeremy

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In a case where you are going to be leasing the airplane to someone else to rent I think you will want a LLC for the airplane. If you own it personally and someone has an accident they can come after your personal assets. If the LLC owns the airplane they can come after the airplane, which will likely have a note at the bank attached to it. When the lawyer sees that there are no assets to be had they stop pursuing it.

 

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When you do a leaseback you are running a business. Check carefully on license requirements. Insurance rates will be significantly higher. There will be significant times when the plane will not be available to you. You will have to schedule it like any other customer of the FBO. You may want to discuss it with an aviation attorney. When people approached me about a leaseback with my World Aviation LSA, I made use of the AOPA legal assistance program. It was well worth the cost. I ended up not doing the leaseback when the attorney raised some tax questions. In my case: would I have to pay sales tax when I changed from personal ownership to an LLC; what would the LLC cost to set up and keep legal each year; and would it affect my income tax (especially since I live in PA and the FBO is in NY. They also asked me to think how often the plane would really be rented out given the weather around here especially on the weekends and during the winter. A lot of people do make leasebacks work out fine. Just think about it very carefully.

 

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Thanks everyone for the feedback and I just finished watching the AOPA video regarding leases and putting a plane into an LLC.  I understand that there would be level of tax regulations that come into play different than an average working person.  I this a leaseback is similar to owning a rental unit, but the tax implications seem a bit different.  I defiantly need to consult with an expert.  The flight school has 2 other planes in leasebacks and might be looking at having a discussion with the other owners to see how their leaseback is set up along with taxes.

Thanks again

Jeremy

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