Air travelers will not get a refund for federal aviation tax

CLEVELAND - When the federal airline tax expired, airline passengers were happy to hear they'd finally catch a break. Now, all that is changing and it's confusing travelers.

The excitement is building for the Marrelli family's trip to Texas.

Amy Marrelli booked five tickets in June, and paid federal aviation taxes on all those seats. In mid-July, the federal airline taxes expired so the IRS told consumers they may be a due a refund.

"I was thinking this is great it's almost like a bonus or refund," Marrelli said.

Some airlines like Delta and JetBlue announced they'd issue refunds while other airlines pushed consumers back to the IRS.

In early August, it seemed clear that refunds would be issued if you traveled while the taxes were still expired. It just wasn't clear how or when you'd get your refund. Then everything changed last Friday.

The pendulum swung from refunds to no refunds when Congress reinstated the airline tax retroactively.

"You tell me I'm going to get a refund and then you go back and change it. It's just things are so up in the air it doesn't make a lot of sense," Marrelli said.

"The IRS is caught with their hands tied," said certified public accountant and Zinner & Co. Partner, Howard Kass. Kass said this isn't the first time Congress reinstated a tax retroactively. It also happened in 1981 on depreciation of real estate and other assets.

"The law passed in October, but the changes in depreciation were retroactive to January first that year," Kass said.

With a precedent for retroactive changes and the current state of the economy, Kass doesn't expect another change.

For travelers, it's just another fee you'll have to absorb.

"I think it leaves a bad taste in everyone's mouth," Marrelli said.