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 Rev. Rul. 77-75

1977-1 C.B. 344

Section 4261 -- Tax on Air Transport of Persons

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Rev. Rul. 77-75

Rev. Rul. 75-535, 1975-2 C.B. 438, concludes that amounts paid for airflight and stand-by time, in connection with unscheduled air ambulance service furnished by a nonprofit organization, are subject to the tax on the transportation of persons by air imposed by section 4261(a) of the Internal Revenue Code of 1954. Under the facts in that Revenue Ruling, patients being transported also incurred inflight medical costs that were separately billed.

Held, the amounts paid for the inflight medical costs are not subject to the tax imposed by section 4261(a) of the Code.

Rev. Rul. 75-535 is amplified.