If you’ve been considering purchasing a private aircraft, now might be the perfect time to prepare for takeoff—100% Bonus Depreciation, also known as 100% Expensing, is expected to make a comeback. This potential change could offer massive tax advantages to qualifying buyers, providing a compelling reason to act sooner rather than later.
What Is 100% Bonus Depreciation?
100% Bonus Depreciation allows qualifying taxpayers to immediately write off 100% of the cost of a new or used aircraft in the year it’s placed in service. Rather than spreading depreciation over several years, this incentive enables buyers to recover the full purchase price up front—significantly improving cash flow and reducing tax liabilities.
Originally expanded under the Tax Cuts and Jobs Act of 2017, the bonus depreciation percentage began phasing down after 2022. However, there is growing momentum in Washington to reinstate full 100% expensing, particularly to boost investment and economic growth.
How Bonus Depreciation Works in Aviation
Bonus Depreciation allows businesses to deduct 100% of the cost of qualifying assets—like aircraft—in the first year the asset is placed in service, instead of depreciating it over several years.
Key conditions for eligibility:
- The aircraft must be used predominantly (more than 50%) for qualified business purposes.
- It must be new to you (both new and pre-owned aircraft can qualify).
- It must be placed in service (i.e., flying and operational) within the same tax year as the deduction.
Aircraft used for charter operations, corporate travel, medical flights, or executive business travel can all potentially qualify.
Important Caveats
- Personal use or entertainment flights may disqualify some hours from bonus depreciation eligibility.
- The IRS may closely scrutinize aircraft use, so it’s critical to document business usage accurately.
- The aircraft must be placed in service by year-end to qualify for that tax year.
- The deduction may trigger Alternative Minimum Tax (AMT) considerations or passive activity limitations—which is why working with a tax advisor is essential.
Example: How Bonus Depreciation Could Save Millions
Let’s say you purchase a pre-owned Bombardier Challenger 350 for $15 million in 2025.
- The aircraft is placed into service in October 2025.
- You use it for executive travel, business development, and occasional charter flights—over 85% of its use qualifies as business-related.
- Under the 100% Bonus Depreciation rule, you may be able to deduct the entire $15 million from your taxable income in 2025.
If you’re in a 37% federal tax bracket:
- Tax savings = $15,000,000 × 37% = $5,550,000
- That’s $5.55 million in tax liability you could offset in the year of purchase.
This significantly improves your cash flow, strengthens your balance sheet, and makes aircraft ownership far more affordable—especially if your business had a strong earnings year.
What This Means for Aircraft Buyers
If reinstated, eligible aircraft buyers would be able to:
- Deduct the entire cost of the aircraft in the first year
- Improve ROI through accelerated depreciation
- Potentially offset substantial business income
- Gain a competitive edge by acting before the window closes again
Do You Qualify?
To take advantage of this benefit, taxpayers must meet specific use and intent requirements outlined in the Internal Revenue Code. Generally, the aircraft must be used predominantly for qualified business purposes and must be placed into service in the applicable tax year.
Talk to Your Tax Advisor
This potential tax break is powerful—but complex. Before making any decisions, we strongly recommend speaking with your tax advisor or CPA to determine whether your situation qualifies, and to structure the purchase accordingly.
Centurion Jets Can Help
At Centurion Jets, we help business leaders, high-net-worth individuals, and corporations:
- Identify aircraft that meet both operational and tax strategy needs
- Coordinate with your tax and legal advisors
- Ensure delivery timelines align with IRS compliance requirements
- Navigate FAA and IRS use definitions, ownership structuring, and management arrangements
Thinking about buying a jet this year?
Let’s talk before Bonus Depreciation flies off the radar again. At Centurion Jets, we specialize in aircraft acquisitions, sales, and advisory services. Whether you’re looking for a light jet, turboprop, or a long-range business aircraft, our team can help you source the right aircraft—and coordinate the acquisition with your tax and legal advisors to ensure everything is aligned.
