Aircraft brokers adn consultants report a surge in interest from customers who delayed purchases pending new legislation. The recently enacted tax order introduces “bonus depreciation,” allowing businesses to immediately deduct the full purchase price of capital equipment, including private jets.
This provision enables owners, typically operating aircraft through their businesses or holding companies, to claim the entire cost in the first year of ownership, effective January 19, 2025. It is crucial to note that this tax credit is exclusively for business purposes and not for private use.
“Many owners were waiting for this opportunity who wanted to develop,” stated Barry Shevlin, CEO of Flyusa Flight Solutions. “And I have at least half a dozen more interested in planning to buy after the law is adopted.”
The tax incentive arrives at a opportune moment for the private aviation sector, which experienced a slowdown following a critically important boom in 2020-2021. While the number of new owners, charter clients, and fractional owners soared post-covid, many initial buyers later sold their aircraft or transitioned to fractional ownership due to higher-than-anticipated maintainance and pilot expenses.
Data from JetNet indicates an increase in the average number of used business aircraft for sale, rising to over 1,800 in the first half of the year compared to 1,744 in the first half of 2024. The average time aircraft spent on the market also lengthened from 386 days to 418 days.
However, a significant wave of private aircraft purchases is anticipated to commence in the fall. Brokers observe that private aircraft acquisitions typically peak at year-end as companies and individuals finalize their tax obligations.
Matt Walter, executive partner at Guardian Jet, commented, “Super-rich individuals do not just make a tax change for a tax change, but this undoubtedly helps the decision.”
This article does not constitute investment advice or recommendations.For detailed legal information, please refer to the legal disclaimer.
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