Advocate Consulting Legal Group, PLLC - The Aviation "TLC" Provider

Toll Free: 888.325.1942 | info@advocatetax.com
  • Aircraft Income Tax
    • SIFL
    • Aircraft Income Tax Online Tools
    • Aircraft Income Tax
  • Aircraft State & Local Tax
    • Aircraft State & Local Tax Online Tools
    • Sales & Use Taxes Articles
  • Aircraft Operations & Law
    • Aircraft Operations & Law Articles
  • YouTube Library
  • Flight Logs
  • About Us
    • Our Team
    • Employment Opportunities
    • Service Agreements
    • Service Delivery – FAQ
    • Contact Us
You are here: Home / Aircraft Tax Savings by Make & Model / SR20

Written by Author

SR20

To Maximize Deductions The Taxpayer Must Place Aircraft in Service in 2013

Current tax law provides for both bonus depreciation and an enhanced expensing election available to new aircraft purchasers.  Fifty percent (50%) bonus depreciation is available for all new aircraft, including fractional interest, that are used primarily for business.  The enhanced expensing election of $500,000 applies to new or used aircraft placed in service by “qualifying small business” taxpayers.  A qualifying small business is one that invests less than $2,000,000 in total equipment purchases during the year.  The 50% bonus depreciation generally applies only to 2013 but may be available for certain new aircraft purchased in 2013 under a binding agreement and delivered in 2014.  Here is how the provisions are impacted on a 2013 purchase of a new Cirrus SR20.

 

Here is how the income tax deductions are calculated for a $400,000 aircraft

 

Cirrus SR20  
 

2013 Delivery

Cost

$400,000

Expensing Election

$400,000

Bonus Depreciation

$0

Regular Depreciation

$0

Total 1st year deductions

$400,000

Percent deductible

100%

 

The new law contains an ordering provision that provides that the expensing election be taken first.  Bonus depreciation is calculated by computing 50% of the balance of the basis remaining after the expensing election.  Regular depreciation is computed on a 5-year basis using the modified accelerated cost recovery method, generally 20% in the first year.  Aircraft ownership structuring is also impacted by unique FAA rules, sales tax issues, and liability concerns which must be blended with these new tax rules.  For further details see our Aircraft Depreciation calculator at http://109.73.238.163/~advoca53/depreciation/formDepSav.php.

Filed Under: Aircraft Tax Savings by Make & Model Tagged With: CIRRUS AIRCRAFT, CIRRUS AIRPLANES, cirrus depreciation, cirrus expensing, cirrus tax deductions

Latest Article

Corporate Jet Investor Town Hall – Finance, Tax and All That Jazz (Webinar Replay)

View a replay of the town hall by clicking the video above, or following the link here.

As you know, these are unprecedented times for business aviation. We invite you to join the Corporate Jet Investor Town Hall as a way of staying connected and informed during this period.

Moderated by Alasdair Whyte, co-founder Corporate Jet Investor, each week CJI will tackle a different issue or topic through the knowledge of as many expert participants as possible.

 » Read more about: Corporate Jet Investor Town Hall – Finance, Tax and All That Jazz (Webinar Replay)  »

Upcoming Events

There are no upcoming events at this time.

Contact Us

Toll Free: 888-325-1942
Email: info@advocatetax.com


Advocate Consulting Legal Group, PLLC. 3555 Kraft Rd. Suite 240 Naples, FL 34105 and 1300 N. Westshore Blvd. Suite 220 Tampa, FL 33607. Suzanne Meiners-Levy, Esq. (239) 213-0066. Tax Disclosure. We inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under federal tax laws, specifically including the Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Privacy Policy. Terms of Use.