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  • The IRS will start dozens of audits on corporate jet usage.
  • It wants to make sure executives aren’t wrongly claiming personal travel as business trips.
  • That’s because companies can get tax deductions for the cost of maintaining a private jet.

Executives who use their companies’ private jets for personal travel will face a crackdown from the Internal Revenue Service.

On Wednesday, the IRS announced plans to start dozens of audits on corporate jet usage.

The audits will focus on large companies and high-income taxpayers, to check whether they’re properly allocating between business and personal flights for tax purposes.

Businesses can receive tax deductions for the cost of maintaining a private jet, as long as it’s being used for business purposes. The IRS wants to make sure people aren’t wrongly claiming personal travel as a business trip, which would let the company get more in deductions.

Last December, the Financial Times reported that a former Credit Suisse chairman used the company’s private jet to join his family on vacation in the Maldives — after disembarking during a fueling stop while traveling with a senior executive.

IRS Commissioner Danny Werfel said: “During tax season, millions of people are doing the right thing by filing and paying their taxes, and they should have confidence that everyone is also following the law.”

“These aircraft audits will help ensure high-income groups aren’t flying under the radar with their tax responsibilities,” he added.

Werfel described it as a “complex area” of tax law where the agency’s work has been “stretched thin.”

“With expanded resources, IRS work in this area will take off,” he added.

According to The New York Times, the IRS will use new data analysis tools that it’s developed with the $80 billion it was granted in 2022’s Inflation Reduction Act.

The scrutiny of corporate jet usage comes as part of a larger effort by the agency to use that funding to ensure wealthy people and big companies are paying what they owe.

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