How the Big Beautiful Bill of 2025 Unlocks Growth Through 100% Aircraft Depreciation

1. Introduction: Policy Changes & Aviation Opportunity Tax policy can change quickly. In aviation, where timing and planning are critical, those changes can either add risk or create a rare opportunity. The One Big Beautiful Bill Act of 2025 (OBBBA) restores 100% bonus depreciation for certain capital investments, effective for purchases placed in service after January 19, 2025. For the business aviation market, this is a significant tailwind.

2. What is 100% Bonus Depreciation? Bonus depreciation lets businesses write off the entire cost of qualifying assets in the year they are placed into service. Under OBBBA, eligible equipment, including aircraft used for business, qualifies for this full deduction. This tax incentive is set to run through 2030, with aircraft purchases potentially eligible through 2031.

3. Direct Impact on Aviation

A. Lower Cost of Ownership
This change enables companies to fully deduct aircraft costs in the year of use, thereby significantly reducing their tax burden and enhancing liquidity. That accelerates return on investment and enhances the business case for ownership.

B. Increased Market Activity
Brokerages, lenders, and legal advisors are already seeing a pickup in deal flow. Aircraft acquisition strategies are shifting to capitalize on this timeline. Buyers must ensure that aircraft are inspected, documented, and in service before year-end deadlines to qualify.

4. Benefits Beyond Aircraft Buyers The growth extends well beyond the aviation operators. Maintenance, repair, and overhaul (MRO) shops, avionics firms, insurance providers, and fuel vendors are all poised to benefit. Even sectors like hospitality and ground transportation feel the ripple effect from increased aircraft activity.

This policy change also boosts manufacturers and suppliers tied to aviation and the general industry. Equipment-heavy businesses in logistics, construction, and tech hardware also qualify for the same 100% write-off.

5. Economic and Employment Gains Restoring full expensing supports manufacturing and industrial growth. Aviation creates high-skill jobs across maintenance, production, flight support, and administration. When aircraft activity grows, employment follows. The OBBBA legislation could help fuel that job creation.

6. Strategic Takeaways for Owners

·       Act fast: Aircraft must be placed in service by December 31, 2030 (2031 for some).

· Prepare thoroughly: The aircraft must meet documentation, usage, and delivery criteria.

·       Align your team: Work closely with legal, tax, and acquisition advisors early on to ensure compliance.

7. Final Thought: Timing is the Opportunity. For many, the return of 100% depreciation is more than a tax break. It's a window to act—to upgrade, acquire, or enter the market. For aircraft owners and providers, this may be the best time in years to make a move.