(Bloomberg) NetJets Inc., the private-plane company owned by Warren Buffett’s Berkshire Hathaway Inc., defeated a U.S. Internal Revenue Service effort to collect more than $366 million in taxes and penalties the agency said were past due.
The company, in the same ruling by a federal judge in Columbus, Ohio, lost its bid for a refund of more than $220 million paid by three of its business units, plus accrued interest.
The judge barred the IRS from disregarding guidance it gave a NetJets predecessor in 1992 and upon which the company relied, as to what parts of its fractional jet ownership businesses were subject to federal excise tax. U.S. District Judge Edmund A. Sargus also said in Monday’s ruling that Buffett’s businesses were bound by a prior determination that they must remit taxes due for per-hour flight fees.
NetJets, based in Columbus, offers fractional jet ownership and maintenance services. In 2011, it sued the IRS claiming the agency had wrongly assessed a so-called ticket tax, an excise tax on payments made in exchange for air transportation upon private aircraft owners and demanded refunds and abatements. Four months later, the IRS countersued.
The case is NetJets Large Aircraft Inc. v. U.S., 11- cv-01023, U.S. District Court, Southern District of Ohio (Columbus).
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