After five years in proposed form, the IRS issued its final rule today disallowing tax deductions for “entertainment” (non-business) use of business aircraft. The rules apply whether the company owns, leases or charters the aircraft.
NBAA joined more than 60 businesses and organizations nationwide in signing a letter urging Congress to extend “bonus” depreciation, which allows for accelerated cost recovery of strategic purchases, including business aircraft. Bonus depreciation included in legislation signed into law in 2010 fell from 100 percent to 50 percent this year.
Accelerated depreciation for private aircraft became a hot topic again this past June when President Obama repeatedly cited it as a prime example of special tax breaks for the rich he wanted to eliminate.
General Aviation Manufacturers Association president and CEO Pete Bunce says recent general aviation rallies held following disparaging remarks about business aviation by President Obama actually go back to the end of 2008 when the CEOs from the Big Three automakers took separate company airplanes to testify before Congress.
Business aviation may still be brimming with righteous indignation over recent attacks by President Barack Obama (in the row over bonus depreciation) and The Wall Street Journal (over the Block Aircraft Registration Request issue), but it now faces bigger and more tangible problems.
President Obama had barely concluded his June 29 press conference when my e-mail box began filling up with responses from the general-aviation industry. The NBAA expressed “dismay” and announced that it was sending a “strongly worded” letter to the President about his remarks, which it said “reflect a total lack of understanding” of the field.
In a resumption of his campaign against business aviation, President Obama yesterday called for an end to “tax breaks” for corporate jet owners.
The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010, which was moving toward the desk of President Obama at press time, would give business aviation a big boost. As NBAA v-p Mike Nichols explained to AIN, the proposal includes “100-percent expensing” of investments in capital assets, such as business aircraft, purchased between September 8 this year and December 31 next year.
On December 17, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. The Act includes “100-percent expensing” of investments in capital assets, such as business aircraft, purchased between Sept. 8, 2010, and Dec. 31, 2011.