The Tax Incentive: Why You Should Buy an Aircraft Before the End of 2020 in the United States

We are now three weeks into the fourth quarter, which means there are few days left in 2020 to take advantage of some extremely significant tax breaks in the United States for purchasing an aircraft.

Bonus Depreciation & The CARES Act

In 2017, the Tax Cuts and Jobs Act enabled 100% bonus depreciation on aircraft. Then this spring, the CARES Act (Coronavirus Aid, Relief, and Economic Security Act) was passed, which is an economic stimulus that provides more than $2 trillion of relief in response to the Covid-19 pandemic. The CARES Act also enabled the carry back of net operating loss since 2015.

The interaction between these two tax policies creates the opportunity to carry back the net operating loss for bonus depreciation. This means that purchasing an aircraft in 2020 allows businesses to use the aircraft depreciation against profits in the past five years and receive a tax refund from higher tax years.

Potential Changes in 2021

While the current administration has been very supportive of the aircraft industry in this regard, the upcoming US election and a potential new administration may impact these tax laws. The election, combined with the current covid-19 health crisis around the world, create a lot of uncertainty about how the current tax regulations benefiting aircraft acquisition may change. Given the global economic consequences of the pandemic and the inevitable losses many of us are currently facing on our books, this presents an interesting opportunity to acquire an aircraft now.

Getting the Process Started Right Away

If an aircraft purchase is in your horizon and you are a United States of America citizen or an incorporated entity, we suggest you do it before the end of the year and while you can still take advantage of these 2020 tax policies. I highly recommend getting in touch with your accountant or a tax specialist right away to discuss how you may qualify for these programs.

Keep in mind that purchasing a helicopter can be a lengthy process – there are pre-purchase inspections that need to be scheduled, maintenance that needs to be completed, etc. We have the capacity, creativity and resources to move quickly on new transactions.

We have several VIP and Corporate models that may suit your needs, including:

VVIP Sikorsky S-76C+ Helicopters

This S-76C+ helicopter is in excellent overall condition and will be sold with both Sikorsky TAP and Honeywell HAPP programs.

Corporate Configured Agusta A109SP Grand New 

This Agusta A109SP Grand new IFR helicopter has low time components and engines and is in immaculate condition having undergone a series of recent inspections. 

VVIP AW139 Helicopters

We have multiple VVIP/Corporate AW139 helicopter options available!

Brad Shaen

International Aviation Marketing (IAM)

This post was originally published on LinkedIn at https://www.linkedin.com/pulse/deducting-aircraft-acquisitions-united-states-why-you-brad-shaen/