US federal excise tax (FET) on a private jet charter is 7.5% of the amount paid for domestic transportation, plus a domestic segment fee of $5.30 per passenger for each takeoff and landing in 2026. International flights pay $23.40 per passenger for each US arrival and departure instead. On a $40,000 domestic round trip with four passengers, the total is $3,042.40.
Key takeaways
- Three taxes, as of 2026: the 7.5% transportation tax, the $5.30 per passenger domestic segment fee and the $23.40 per passenger international arrival and departure tax.
- The 7.5% is fixed in law; the per-passenger amounts rise with inflation every January, so check the year on any figure you see.
- Repositioning and waiting time are taxable when they are billed to you as part of the charter.
- Flights to Canada and Mexico within 225 miles of the US border are taxed as domestic, not international.
- Owners flying their own aircraft generally pay no transportation tax, and fractional programs pay a fuel surtax instead.
What is federal excise tax on private jet charter?
FET is the federal tax on paid air transportation under section 4261 of the Internal Revenue Code. It applies to private jet charter in the same way it applies to an airline ticket, because a charter is transportation sold for payment. The passenger (or the company paying) owes the tax. The person receiving payment for the flight normally collects it and pays it to the IRS on Form 720, the quarterly federal excise tax return, according to IRS Publication 510.
The tax money goes to the Airport and Airway Trust Fund, which funds the FAA's airport and air traffic programs.
What are the FET rates for 2026?
The current rates come from the IRS Instructions for Form 720 (revised June 2026):
| Tax | 2026 rate | Applies to |
|---|---|---|
| Transportation of persons by air | 7.5% of the amount paid | Domestic flights, including the 225-mile zone in Canada and Mexico |
| Domestic segment fee | $5.30 per passenger, per segment | Each takeoff and landing on a domestic flight, unless to or from a rural airport |
| International arrival and departure tax | $23.40 per passenger | Each international flight that begins or ends in the US |
| Alaska and Hawaii departure tax | $11.70 per passenger | Departures on domestic segments that begin or end in Alaska or Hawaii |
| Transportation of property by air | 6.25% of the amount paid | Cargo, not passengers |
The 7.5% rate is set by statute and does not change with inflation. The three per-passenger amounts are indexed and change each January, so check the Form 720 instructions for the current year whenever you read an older article or quote.
What does the 7.5% tax apply to?
It applies to the amount you pay for the transportation, which on a charter is more than the flight time. Publication 510 lists charges for "layover or waiting time, and movement of aircraft in deadhead service" as part of the amount paid. In charter terms:
- Flight time for your legs is taxable.
- Repositioning (ferry) legs billed to you are taxable, even with nobody on board.
- Waiting time and daily minimums are taxable when they are charges for the transportation.
- Other line items such as catering, de-icing, landing fees or crew overnight costs: treatment depends on how they are billed. Ask the operator which lines carry FET and which do not.
A good quote shows FET as its own line. If you are comparing quotes and one looks cheaper, check that it includes the taxes. Our post on easily avoidable booking mistakes covers other hidden-cost traps.
How does the domestic segment fee work?
A segment is one takeoff and one landing, and on a charter the fee is multiplied by the number of passengers. Publication 510 states that when an aircraft is chartered, the segment tax "is figured by multiplying the tax by the number of passengers transported on the aircraft."
So for 2026:
- A nonstop one-way flight with 6 passengers: 1 × 6 × $5.30 = $31.80
- A round trip with a fuel stop each way (4 segments) and 6 passengers: 4 × 6 × $5.30 = $127.20
- A repositioning leg with no passengers: $0 in segment fees (the 7.5% still applies if billed)
The segment fee is small next to the 7.5%, but it adds up on multi-stop itineraries with large groups.
The rural airport exception
The segment fee does not apply to a segment that begins or ends at a rural airport. The 7.5% tax still applies. Under Publication 510, an airport is rural for a calendar year if fewer than 100,000 commercial passengers departed from it in the second preceding year, and at least one of these is true:
- It is not within 75 miles of another airport with 100,000 or more commercial departures in that year.
- It was receiving Essential Air Service subsidies as of August 5, 1997.
- It is not connected by paved roads to another airport.
The Bureau of Transportation Statistics publishes the current rural airports list. Many small airports used by charter flights count as rural, but you need to check the list rather than assume.
How is international charter taxed?
International flights pay the per-passenger international arrival and departure tax instead of the 7.5% tax and segment fees. For 2026 the tax is $23.40 per person for each flight that begins or ends in the US. A round trip from Los Angeles to Cabo San Lucas with 6 passengers is 6 × 2 × $23.40 = $280.80, regardless of the charter price.
The 225-mile zone
Publication 510 defines taxable (domestic) transportation to include trips that begin and end in the US or at any place in Canada or Mexico "not more than 225 miles from the nearest point on the continental U.S. boundary." Flights to cities such as Toronto, Montreal or Vancouver fall inside the zone, so they pay 7.5% plus segment fees, not the international tax. The international tax does not apply when the whole trip is subject to the percentage tax.
That makes a short international hop to Canada more heavily taxed than a long one to the Caribbean. On a $30,000 round trip with four passengers:
| Trip | Taxes (2026) |
|---|---|
| New York to Toronto (inside the zone) | $2,250 (7.5%) + $42.40 (8 segment fees) = $2,292.40 |
| New York to Nassau (outside the zone) | 4 × 2 × $23.40 = $187.20 |
Foreign governments add their own taxes and fees on top. For the customs and permit side of international trips, see our guide to flying a private jet internationally.
How are flights to Alaska and Hawaii taxed?
Flights between the continental US and Alaska or Hawaii are partly exempt. The 7.5% tax applies only to the part of the route in US airspace; the portion between leaving the continental US (3 nautical miles offshore or the border) and arriving in Alaska or Hawaii is not taxed. The domestic segment fee applies to each segment, and Publication 510 adds the travel facilities tax, which for these routes is charged only on departures from Alaska or Hawaii: $11.70 per passenger for 2026.
In practice, the operator calculates the taxable share of the price for these routes, so expect a quote with a smaller FET line than 7.5% of the total.
Flights within Hawaii, or within Alaska, are taxed on the entire fare, even if part of the route passes over international waters or Canada, provided no point on the route is more than 225 miles from the US.
When doesn't FET apply?
FET applies to amounts paid for transportation. If no one is buying transportation, or a specific exemption applies, the tax does not. The main cases in Publication 510:
| Situation | Transportation tax? | What applies instead |
|---|---|---|
| Owner flies their own aircraft (Part 91) | No, no transportation is purchased | Fuel tax, generally $0.219 per gallon for jet fuel in noncommercial use |
| Owner pays a management company for flights on their own aircraft | No, exempt aircraft management services | Fuel tax; but flights on a substitute aircraft can be taxable |
| Fractional ownership program flights | No, when the fuel surtax is imposed | A surtax of $0.141 per gallon on top of fuel tax |
| Flights between members of an affiliated corporate group (80% ownership) | No, if the aircraft is not available for hire to outsiders | Fuel tax |
| Aircraft with maximum takeoff weight of 6,000 lb or less | No, unless on an established line | This exemption never applies to jet aircraft |
| Air ambulance, skydiving, certain seaplane and forestry flights | No | Specific conditions apply |
Two points catch people out. First, the owner exemption covers people who hold title or lease an aircraft for 31 days or more; it does not cover short-term leases, fractional shares or flights on a substitute aircraft. Second, jet cards and memberships are not ownership. Payments for flight hours are generally taxable, and how membership fees are treated depends on the program.
This is a general guide, not tax advice. Ownership and leasing structures in particular need a qualified aviation tax adviser.
Worked examples for 2026
The tax is easy to calculate once you know the trip type. Each example assumes the price shown is the full taxable amount.
1. Domestic round trip, light jet. Los Angeles to Las Vegas and back, 5 passengers, $16,000.
- 7.5% × $16,000 = $1,200.00
- 2 segments × 5 passengers × $5.30 = $53.00
- Total FET: $1,253.00
2. Domestic one-way with repositioning, super midsize jet. Teterboro to Palm Beach, 8 passengers, $38,000 including the empty return.
- 7.5% × $38,000 = $2,850.00
- 1 segment with passengers × 8 × $5.30 = $42.40 (the empty leg carries no passengers)
- Total FET: $2,892.40
3. Hawaii to the mainland. Honolulu to Los Angeles one way, 6 passengers.
- 1 segment × 6 × $5.30 = $31.80
- 6 × $11.70 (Hawaii departure) = $70.20
- Plus 7.5% of only the share of the price attributable to US airspace, which the operator calculates
- Fixed per-passenger taxes: $102.00, plus the partial 7.5%
4. International round trip, heavy jet. Van Nuys to Cabo San Lucas and back, 10 passengers, $70,000.
- No 7.5% tax and no segment fees
- 2 crossings × 10 passengers × $23.40 = $468.00
- Total US FET: $468.00, plus Mexican taxes and fees
Try your own numbers in the charter tax calculator, which uses the 2026 rates.
How to check the taxes on a charter quote
A short checklist when a quote arrives:
- Is FET shown as a separate line? If not, ask whether the price includes it.
- Is the 7.5% applied to the right base, including repositioning and waiting time?
- Are segment fees counted per passenger, per segment, including fuel stops?
- For international trips, is the trip inside or outside the 225-mile zone?
- Are foreign taxes and fees included for international destinations?
- Is the rate for the current year? The per-passenger amounts change every January.
To see how taxes fit the full trip price, use the private jet charter cost estimator or read our 2026 guide to private jet charter costs. When you are ready, request a quote and we will show every tax and fee as its own line.