Covid concerns may be easing, interest rates rising, and the stock market falling, but prospective business buyers of private jets are highly motivated to make their purchases this year because the "free ride" of 100% depreciation in the first year of use, afforded by the 2017 Tax Act, will end December 31, 2022, according to Daniel Jennings, CEO of private jet broker, The Private Jet Company (TPJC).
NORTH PALM BEACH, Fla., July 6, 2022 /PRNewswire-PRWeb/ -- Covid concerns may be easing, interest rates rising, and the stock market falling, but prospective business buyers of private jets are highly motivated to make their purchases this year because the "free ride" of 100% depreciation in the first year of use, afforded by the 2017 Tax Act, will end December 31, 2022, according to Daniel Jennings, CEO of private jet broker, The Private Jet Company (TPJC).
Instead of 100%, which has been available until the end of this year, the maximum allowed depreciation declines to 80% in 2023, 60% in 2024, and in increments of 20% for each year following that, explained Jennings. An additional incentive to purchase business aircraft is provided by the 2020 CARES Act, which included a five-year net operating loss carryback that permits tax payments going back to 2015 to be refunded due to a loss in the current year.
"Prospective buyers wanting to take advantage of that 100% depreciation before the end of the year have put additional pressure on an already overheated market for preowned aircraft," said Jennings.
The Private Jet Company (TPJC) provides sales, acquisition, and a wide range of private aviation consulting services to private jet buyers and sellers.
"Prospective buyers need to be aware that, like any tax regulation, the rules on depreciation for a business aircraft are complex," warns Jennings. "Whether you can take depreciation, and how much you can take in the first year of operation after purchase in 2022 depends on your income and how the plane is utilized – whether for your own business or for charter, and the percentage that each of those uses."
The additional pressure on demand for private aircraft comes at a time when the number of available preowned planes is at an all-time low. Why not order a new plane? The answer is that most manufacturers are sold out for the next three years; new planes are built to order, not mass produced.
"The best advice I can give is to find an experienced professional private jet broker with experts who know how to find preowned jets in this market and how to negotiate the best deal for you, as well as all the ins and outs of regulations. Normally it takes 30 days to complete the sale of a preowned jet, so you need to start the process soon if you want to complete the transaction before the 100% depreciation runs out," notes Jennings.
How jet brokers can help ?
Brokers can help private jet buyers, sellers, and owners in several ways: by advising on financing and tax regulations of buying and owning an aircraft; by finding private jets for sale that are off-market or that will come to market after refurbishment, upgrades or major maintenance; by negotiating a private jet sale with sellers using experienced brokers; by finding private jets for sale that could generate charter revenues to lower the acquisition costs; by finding a private jet for sale and knowing operators who will charter it out quickly.
For advice and information on acquiring or selling private jets: Email [email protected] or call (310) 980-9069 or go to https://www.ThePrivateJetCompany.com/
About The Private Jet Company (TPJC)
The Private Jet Company offers sales, acquisition, and consulting services for private aircraft in major markets throughout the world. Founded in 2005 with headquarters in North Palm Beach, FL and regional offices in Paris, France and Mexico City, Mexico, TPJC has completed over $2 billion of aviation transactions for individual and corporate owners. In addition to assisting clients buy and sell aircraft, the company works with aircraft management companies to reduce the burden of maintenance and supplement revenue through charters. TPJC also partners with aviation attorneys and tax experts to help clients maximize depreciation, reduce tax burdens, and assist in import and export Certificates of Airworthiness.
Media Contact
Daniel Jennings, The Private Jet Company, 310 980 9069, [email protected]
Chris Lazarus, The Private Jet Company, 503 867 1370, [email protected]
SOURCE The Private Jet Company
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