Neither a Borrower Nor a Lender Be. That’s good advice if one of the things “borrowed” is your aircraft, particularly if the “borrower” offers to cover the fuel and other trip-specific expenses. That will spell trouble for both of you, as both the FAA and IRS have very specific rules governing “borrowed” aircraft, prohibiting the user from reimbursing the owner for any direct or indirect flight costs.
Trading money for miles to use a non-commercial aircraft constitutes illegal charter – and that puts at risk not only your wallet, but also passenger and aircraft safety. In Global Warning, Ryan Waguespack and David Norton detail illegal charter’s specific regulatory risks, and how violating those regulations can result in seven-figure government fines – in addition to endangering those traveling aboard an illegal flight.