Terrence,

 

1. If you bought a kit or "project" out of state, you probably did not pay any sales tax (if you did, save the documentation forever).

 

2. Illinois gets N number data from the FAA and if you got a number before finishing the kit, the state will request that you pay tax on the project.

 

3. It is usually beneficial to pay the tax on the unfinished and numbered kit because its value is low.  N-numbering a finished project requires that you pay the tax on the value created from all the stuff you put in it and didn't pay such tax - such as out of state purchased items like an engine or avionics panel.

 

Any information given here is more than 5 years old and may not cover your situation since the state has become quite aggressive about tax collection.

 

Good Luck,

 

Grayhawk

 

This is a kind of survey.

It is regarding Illinois Dept. of Revenue's apparent attempt to tax KITS long before they become 'aircraft'.  Technically, the creation of an 'aircraft', according to the FAA regs I read, occurs when an Airworthiness Inspection Certificate is awarded, making that date the Date of Manufacture... of an 'aircraft', where none existed before. 

 

Since many, many kits NEVER become 'aircraft', for the IL Dept. of Revenue to apply 'Aircraft Use Tax' to them by pretending the KITS are 'aircraft' seems unfair, especially since if you purchase someone's KIT, the FAA Form 8050-2 Bill of Sale is required by the FAA to be modified by crossing out the word 'AIRCRAFT" and printing above/below it the word KIT ... because it is not an aircraft.

 

The confusion in my case (1985 kit) stems partly from the old FAA practice of letting hopeful builders request an N-number (like, more than 15 years ago) even before a project was started or a kit started. Further confusion was introduced later when the FAA began requiring KIT manufactures to apply N-numbers to sold KITS!

Logically, the Numbers  are  really issued to persons, and N-numbers are now being referenced to some project or KIT, until a project passes an Airworthiness Inspection and its builder/Manufacturer gets its Airworthiness certificate.

 

I'd be interested to hear the experience of anyother Illinoisan's experience buying someone's pre-numbered kit.

Terrence

L235/320 N211AL