Photo: Jerry Metellus
The Trump Administration has been talking for years about providing tax breaks to owners of private jets and now, they’re here. They couldn’t come at a better time as the market for private jets Las Vegas starts really heating up. While once it was thought that only the very wealthy used private jets to get to their destinations, now it’s an opportunity younger clients are starting to seize as a ride-sharing option. The new tax law for private jets means the market for private jets is about to explode even further.
What is the Private Jet Tax Break?
Prior to the new tax law, owners of private jets could claim a 50 percent deduction for the acquisition on their tax returns. The deduction applied to new aircraft only. Private jet owners expected that to drop to just 30 percent in 2019. Now however, those purchasing new private jets may be able to deduct 100 percent of the cost on their tax returns.
It’s important that those considering such a purchase structure the purchase carefully, as outlined under the Internal Revenue Code. Any aircraft eligible for a deduction must also be purchased before 2023.
Tax Break for Business Planes Only
It’s important to understand that while this 100 percent tax break is possible, it only applies to private jets purchased for business reasons. This means that the aircraft cannot be used for personal use for the first year after its purchase. If there is any reason for the IRS to believe the aircraft is for personal use, they may not apply the tax break.
While the IRS does require the private jet be purchased for business purposes, there are ways private jet owners can get around this. For example, if a person had a home office and had to travel for business, they could use a private jet to get to their business trip and still enjoy the tax breaks.
Unfortunately, both the trip would have to be for business purposes, as well as the private jet. This will establish it as a necessary and ordinary expense eligible for deduction.
Elimination of Entertainment Deductions
Prior to the new tax law, business owners that used their private jet for entertaining business guests were also eligible to claim the expenses. However, with the new Act, that has been eliminated. While private jets are still a great source of entertainment for important clients, they do not provide any tax breaks. If a private jet is purchased for the sole intention of providing entertainment to clients, it will also not be eligible for the write-offs.
Call the Las Vegas Private Jet Charter that Can Help You Stay Current with the Law
There’s a lot that goes into purchasing and owning a private jet. With the tax laws around these aircraft changing so regularly, it’s crucial private jet owners stay up to date with what the law says and requires, so they can fly safely and securely, and not get into trouble with the IRS. If you’re interested in purchasing a private jet in Las Vegas, or you just want to see how luxurious private jets really are, call Cirrus Aviation at (702) 472-9714 or contact us online. We can provide all the information you need, and help you arrive at your next destination in style.