Thanks to favorable tax laws including Section 179, aircraft ownership may cost less than you think.
The Section 179 Tax Deduction is meant to help business owners purchase the equipment they need to stay competitive and prosperous. In January 2018, the Tax Cuts and Jobs Act increased the Section 179 maximum deduction from $500,000 to $1,000,000. This deduction applies to new and used equipment (including the purchase of aircraft used for business purposes). The new law also increased the spending cap on equipment purchases from $2 million to $2.5 million.
Historically, business owners have often waited to make tax-motivated purchase decisions until later in the year, as the limit for the Section 179 Tax Deduction amount was not always finalized until closer to year-end.
Fortunately, Congress decided in late 2016 to make the $500,000 limit permanent going forward, and the Tax Cuts and Jobs Act was approved at the beginning of 2018, allowing businesses to make better-informed purchase decisions throughout the year.
To qualify as a write-off for 2018, any aircraft purchased must be placed into service prior to midnight on December 31, 2018.
Bonus Depreciation rules may also apply to purchases of new aircraft and/or new equipment installed into used aircraft. For 2018, owners can depreciate up to 100% of the cost of the new aircraft and/or equipment.
To see how much savings you may receive using these tax incentives, you can try running some numbers using this free Section 179 Tax Deduction Calculator.
If you’re considering the purchase of an aircraft, we would love to consult with you! We can help you identify the right aircraft for your mission and achieve a successful transaction. We can also take trade-in aircraft or help you sell your current aircraft quickly and easily.
Call us anytime at 402-475-6000 or email us at firstname.lastname@example.org.