What expense category is Airlines Reporting Corporation?
Airlines Reporting Corporation (ARC) is an airline-owned financial intermediary that accredits travel agencies, settles air ticket transactions, and provides business intelligence and data services to the U.S. travel industry.
ARC (Airline Reporting Corporation) is owned by major airlines and serves as the financial backbone of U.S. air travel distribution, processing over $86 billion in annual settlements across nearly 20,000 points of sale and tracking data from over 12 billion passenger flights per year. It accredits travel agencies, corporate travel departments (CTD), and Verified Travel Consultants (VTC), enabling them to issue airline tickets and settle payments. Businesses pay a one-time accreditation joining fee ($5,000–$55,000 based on monthly transaction volume) plus ongoing per-transaction settlement fees. ARC also offers data analytics, business intelligence tools, and industry events. Despite the source's 'Rideshare & taxi' classification, ARC is a financial/professional services intermediary for the aviation industry.
How businesses classify Airlines Reporting Corporation
Tax details
- ARC accreditation joining fees ($5,000–$55,000) are deductible as an ordinary business expense for travel agencies and corporate travel departments — deduct in the year paid under cash basis, or amortize if the benefit extends beyond 12 months under accrual.
- Ongoing ARC transaction settlement fees are fully deductible as a cost of doing business — retain monthly ARC settlement statements as documentation.
- ARC data analytics and business intelligence subscription fees are deductible operating expenses; keep invoices separate from settlement fees for cleaner bookkeeping.
- Corporate Travel Department (CTD) accreditation costs are deductible for large companies managing their own air travel procurement — document that the expense is ordinary and necessary for your travel management function.
- If ARC fees are shared across departments or subsidiaries, allocate costs using a reasonable method (e.g., by transaction volume) and document the allocation methodology.
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Related expenses
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