Interaction of sections 469 and 4261. This ruling describes the circumstances in which losses incurred by an individual who provides air transportation through a passthrough entity can qualify as passive losses under section 469 of the Code. In addition, this ruling describes the applicability of section 4261 to the amounts paid for the air transportation services.

Final regulations under section 4291 of the Code provide guidance for collectors of communications excise taxes under section 4251 and excise taxes on amounts paid for taxable transportation under sections 4261 and 4271. These regulations clarify the time by which collectors must report refusals to pay or other failures to collect these excise taxes.