Aircraft Club Sept 2024: Depreciation considerations for business aircraft

In brief

What happened? 

As the end of the calendar year approaches, companies may be placing business aircraft into service that have been, or will be, acquired before year end. The calculation of the depreciation deduction for these aircraft requires identification of the proper recovery period. 

Why is it relevant?

The recovery period applicable to business aircraft depends on the primary use of the property. Special rules apply if there is a change in the use of the aircraft.

Action to consider  

Because an aircraft may be a dual-use asset, companies should examine how the property is used in their business to compute the correct amount of depreciation for the tax year.