100% Bonus Depreciation & Your Aircraft Brokerage Career

The world of aviation is constantly evolving, driven by technological advancements, market demands, and significant policy shifts. For aspiring and established aircraft brokers, staying ahead of these changes isn't just an advantage—it's a necessity. A monumental shift has recently occurred that promises to reshape the landscape of aircraft sales and present an unprecedented opportunity for those in the brokerage business: the reinstatement of 100% bonus depreciation.

On July 4, 2025, the signing of the One Big Beautiful Bill (OBBB) marked a pivotal moment. This sweeping legislative package permanently reinstates 100% bonus depreciation for qualified property, including corporate jets, placed in service after January 19, 2025. This isn't merely a temporary tax break; it's a long-term incentive designed to stimulate business investment in capital-intensive assets like aircraft. The implications for the aviation industry are profound, creating a surge in demand for aircraft and, consequently, for skilled aircraft brokers who can guide buyers through this financially savvy acquisition process.

This blog post will delve into the intricacies of this new tax provision, explaining what 100% bonus depreciation means, who qualifies, and what pitfalls to avoid. More importantly, we will explore the immense opportunities this creates for aircraft brokers. As the market experiences a significant boost in aircraft sales, the need for expert guidance in navigating complex transactions becomes paramount. This is where the Aircraft Broker Academy comes in. Our comprehensive course is designed to equip you with the knowledge, skills, and resources to capitalize on this boom, helping buyers acquire aircraft and leverage these new tax advantages. Whether you're an aspiring broker looking to enter a thriving market or an established professional seeking to enhance your expertise, understanding the OBBB and its impact is crucial for your success.

Understanding 100% Bonus Depreciation: A Game Changer

To truly grasp the significance of the One Big Beautiful Bill, it’s essential to understand what bonus depreciation entails and how its reinstatement at 100% fundamentally alters the financial landscape for aircraft acquisitions. In essence, bonus depreciation is a tax incentive that allows businesses to deduct a substantial portion—or even the entire cost—of eligible assets in the year they are placed in service, rather than spreading those deductions over the asset’s useful life through traditional depreciation methods.

Consider this example: if a business needs to transport a dozen individuals frequently from Los Angeles to Sydney, a Gulfstream 650 ER, valued at 35million, would be an ideal fit. With 100% bonus depreciation, as per Internal Revenue Code Section 168(k), the business can deduct the entire cost of the Gulfstream from its taxable income in the year of purchase. This immediate tax relief is a powerful tool, freeing up significant capital that can be reinvested into the business or allocated to other strategic priorities.

The story of modern bonus depreciation saw a dramatic shift with the Tax Cuts and Jobs Act (TCJA) of 2017. Before the TCJA, businesses could deduct 50% of the cost of qualified property in the first year. The TCJA revolutionized this by increasing the deduction to 100% for qualified property acquired and placed in service between September 27, 2017, and December 31, 2022. This applied to both new and used assets, provided it was the taxpayer’s first use, making pre-owned corporate jets eligible for the full deduction. This led to a surge in corporate jet acquisitions as companies capitalized on the opportunity to offset substantial costs against their tax liability.

However, the TCJA included a phase-down schedule, reducing the bonus depreciation rate by 20% each year starting in 2023: 80% in 2023, 60% in 2024, 40% in 2025, and eventually 0% in 2027. By early 2025, the deduction had dropped to 40%, significantly diminishing its appeal. This is precisely where the One Big Beautiful Bill changes the narrative. Signed into law on July 4, 2025, the OBBB permanently reinstates 100% bonus depreciation for qualified property placed in service after January 19, 2025, with no expiration date. This landmark legislation restores the financial incentive that previously fueled the aviation market, making 2025 and beyond an exceptionally opportune time for aircraft acquisitions.

For corporate jet owners, this means the ability to deduct the full purchase price of an aircraft, whether new or pre-owned, in the year it’s placed in service, provided it meets specific criteria. This powerful incentive makes acquiring a corporate jet not just a strategic business move but a financially savvy one, offering immediate and substantial tax benefits that were previously phasing out. This permanent reinstatement is a cornerstone of the OBBB’s pro-growth agenda, designed to stimulate business investment in capital-intensive assets like corporate jets.

Who Qualifies for This Powerful Incentive?

To fully leverage the benefits of 100% bonus depreciation, it’s crucial to understand the specific IRS criteria that property must meet. These criteria have remained largely consistent under the OBBB, ensuring clarity for businesses looking to make qualified acquisitions. Here’s a breakdown of what qualifies:

• Tangible Personal Property: The asset must be tangible personal property with a recovery period of 20 years or less under the Modified Accelerated Cost Recovery System (MACRS). Corporate jets, whether new or pre-owned, fit this category perfectly, typically having recovery periods of 5 or 7 years. This means that the aircraft itself, as a physical asset, is eligible for the deduction.
• Placed in Service: The aircraft must be placed in service, meaning it is ready and available for its intended business use, after January 19, 2025. This is a critical date, as it marks the effective start of the permanent 100% bonus depreciation under the OBBB. Simply purchasing the aircraft isn't enough; it must be operational and available for its business purpose.
• Predominant Business Use: The jet must be used predominantly (more than 50%) in the active conduct of a trade or business. This includes a wide range of activities such as transporting executives, clients, or goods for business purposes. The intent of this criterion is to ensure that the tax incentive supports genuine business operations rather than personal use.
• Acquisition Rules: The aircraft must not be acquired from a related party or in certain tax-free transactions, as defined by the IRS. These rules are in place to prevent the manipulation of the deduction through transactions between closely connected entities. It’s important for buyers to ensure their acquisition adheres to these arm's-length principles.

Understanding these qualifying factors is paramount for any business considering an aircraft acquisition. While the potential tax savings are significant, adherence to these IRS guidelines is essential to ensure compliance and maximize the benefits. Businesses should always consult with their tax professionals to confirm eligibility and tailor advice to their specific situations.

What Doesn't Qualify? Avoiding Pitfalls

While 100% bonus depreciation offers substantial benefits, it’s equally important for businesses and their advisors to understand what types of assets or expenses related to corporate aviation do not qualify. Missteps in this area can lead to significant tax complications. Here are the key exclusions to be aware of:

• Real Property: Assets such as hangars, terminals, runways, taxiways, and aprons are generally ineligible for bonus depreciation. These types of real property have recovery periods ranging from 25 to 50 years, falling outside the qualifying criteria. Furthermore, land itself is not depreciable at all.
• Operational Costs: Bonus depreciation applies exclusively to capital expenditures for acquiring or improving assets. Therefore, ongoing operational costs like fuel, routine maintenance, crew salaries, hangar fees, and insurance do not qualify for this accelerated deduction. These expenses are typically deductible as ordinary business expenses, but not under bonus depreciation.
• Personal Use: The aircraft must be used predominantly for business purposes (more than 50%). If personal use exceeds this threshold, the jet is disqualified from bonus depreciation. In such cases, the aircraft must be depreciated under the Alternative Depreciation System (ADS), which extends the recovery period and precludes the use of bonus depreciation. This emphasizes the importance of meticulous record-keeping for business versus personal use.
• Related Party Transactions: To prevent tax manipulation, jets acquired from related parties, as defined by the IRS, are ineligible for bonus depreciation. This rule ensures that the incentive is used for genuine, arm’s-length transactions that stimulate new investment.
• Property Used Predominantly Outside the US: The incentive targets domestic economic activity. Consequently, assets used more than 50% outside the U.S. do not qualify for bonus depreciation. Businesses operating internationally need to carefully track the usage location of their aircraft.
• Leased Aircraft: Generally, leased jets do not qualify for bonus depreciation, as this incentive applies to owned assets. While lessees may explore other tax strategies, the direct benefit of 100% bonus depreciation is typically reserved for outright purchases.
• Intangibles and Long-Life Assets: Intangible assets like licenses or patents, or any assets with recovery periods exceeding 20 years, are excluded from bonus depreciation. The focus remains on tangible personal property with shorter recovery periods, such as aircraft.

Navigating these exclusions is as critical as understanding the qualifications. Businesses should maintain meticulous documentation of their aircraft’s business use and always consult with tax professionals to ensure full compliance and optimize their deductions. This proactive approach will help avoid potential pitfalls and ensure that the benefits of the OBBB are fully realized.

The Golden Opportunity for Aspiring and Established Aircraft Brokers

The permanent reinstatement of 100% bonus depreciation through the One Big Beautiful Bill is more than just a tax provision; it’s a catalyst for significant growth in the corporate aviation sector. For aspiring and established aircraft brokers, this translates into a golden opportunity, creating a fertile ground for increased demand and a heightened need for expert guidance. Historically, tax incentives like bonus depreciation have directly influenced aircraft acquisition trends. The 2017 TCJA, which initially introduced 100% bonus depreciation, led to a notable surge in corporate jet purchases. With the OBBB making this incentive permanent, we can anticipate a similar, if not greater, boost in aircraft sales. Businesses that were hesitant to invest in capital-intensive assets due to the phasing out of the deduction now have a clear, long-term financial incentive to acquire aircraft. This renewed confidence in the tax benefits will drive more companies to consider aircraft ownership as a strategic business asset. In this environment, aircraft brokers become indispensable. The process of acquiring an aircraft is inherently complex, involving intricate negotiations, legal documentation, and a deep understanding of market dynamics. When you add the nuances of tax implications, the role of a knowledgeable broker becomes even more critical. Buyers will increasingly rely on brokers not just to find the right aircraft, but also to understand how to structure the acquisition to maximize the benefits of 100% bonus depreciation. Brokers will be at the forefront, guiding clients through the eligibility criteria, helping them identify qualified aircraft, and ensuring that all aspects of the transaction align with the tax provisions.

This increased demand for aircraft, coupled with the complexity of leveraging the bonus depreciation, positions aircraft brokers as key facilitators in the market. They will be the trusted advisors helping businesses make informed decisions that are both operationally sound and financially advantageous. For those looking to enter the aircraft brokerage profession, or for seasoned brokers seeking to expand their practice, this is an unparalleled moment. The market is ripe for growth, and those equipped with the right knowledge and skills will be best positioned to capitalize on this new era of corporate aviation investment.

How the Aircraft Broker Academy's Course Equips You for Success

In a market energized by the permanent reinstatement of 100% bonus depreciation, the demand for skilled and knowledgeable aircraft brokers is set to soar. This is precisely where the Aircraft Broker Academy course becomes an invaluable asset for both aspiring and established professionals. Our comprehensive program is meticulously designed to equip you with the expertise needed to navigate this new landscape, guide clients effectively, and ultimately, close more deals. The course modules are structured to provide a holistic understanding of the aircraft brokerage business, with several key areas directly addressing the opportunities presented by the OBBB:

• Aircraft Knowledge: To effectively advise clients on aircraft acquisitions, a deep understanding of aircraft systems, types, and maintenance procedures is crucial. Our course provides in-depth aircraft knowledge relevant to sales, enabling you to speak and act confidently when discussing potential acquisitions with clients who are looking to leverage bonus depreciation.
• Starting Your Business: For those new to the field, the course offers practical guidance on how to establish your aircraft brokerage business in the United States, ensuring you have a solid foundation to build upon as demand for aircraft increases.
• How to Get Clients: With the anticipated boost in aircraft sales, attracting and retaining clients will be paramount. This module teaches up-to-date marketing strategies to acquire new clients and the skills to keep them around, ensuring you can capitalize on the heightened market activity.
• The Sales Process: Navigating the paperwork associated with selling airplanes can be daunting. Our course provides comprehensive training on handling all aspects of the sales process, including access to essential forms and contracts. This includes critical documents such as the Letter of Intent (LOI), Aircraft Purchase Agreement, Technical Acceptance Letter, and Delivery Receipt, among others. Having these templates and understanding their proper use is vital for smooth and compliant transactions, especially when dealing with the complexities of tax-driven acquisitions.
• Aircraft Acquisition: This module specifically focuses on how to find the perfect aircraft for your client and earn a commission. In the context of bonus depreciation, this means understanding how to identify aircraft that meet the IRS’s qualifying criteria, ensuring your clients can fully benefit from the tax incentive.

Beyond the structured modules, the Aircraft Broker Academy provides practical tools and resources, including access to the ABA App and the ABA’s Inner Circle and Private FB group. These resources offer ongoing support, networking opportunities, and access to a community of professionals. By enrolling in the Aircraft Broker Academy's Course, you are not just learning; you are gaining a comprehensive solution that empowers you to become a successful aircraft broker, ready to seize the unprecedented opportunities presented by the new 100% bonus depreciation and the resulting surge in aircraft sales.

Conclusion

The permanent reinstatement of 100% bonus depreciation through the One Big Beautiful Bill has ushered in a new era for corporate aviation, creating an unprecedented surge in demand for aircraft. This legislative change presents a golden opportunity for both aspiring and established aircraft brokers to thrive in a rapidly expanding market. As businesses look to capitalize on these significant tax advantages, the need for expert guidance in navigating complex aircraft acquisitions has never been greater. For those ready to seize this moment, the Aircraft Broker Academy offers the definitive pathway to success. Our comprehensive course provides the in-depth knowledge, practical skills, and essential resources—from understanding aircraft specifics to mastering the sales process and accessing critical legal templates—that you need to excel. Don't let this transformative opportunity pass you by. Enroll in the Aircraft Broker Academy's course today and position yourself at the forefront of this exciting and lucrative industry. The sky truly is the limit for your career as an aircraft broker.