For many aircraft buyers, especially corporations purchasing expensive business jets, completing the transaction by year-end has important tax implications. The FAA registration branch in Oklahoma City is normally a very busy place on Dec. 31. But because Jan. 1 falls on a Saturday in 2022, the official New Year’s holiday will be Friday, New Year’s Eve, and the registry will be closed. Further, the offices are expected to close early on Thursday, Dec. 30.
National Business Aviation Association (NBAA) President and CEO Ed Bolen said, “NBAA strongly advises anyone finalizing an aircraft transaction this month to incorporate the registry’s holiday closings into their plans and file documentation at least several days before that date.”
Jeffrey Towers, general counsel for aircraft at TVPX and past chair of the NBAA Tax Committee, said, “Taxpayers considering immediate or full expensing on their aircraft transactions are required to fulfill specific duties before the end of the year to be eligible for this deduction. This year, companies are realizing a return of business activity that may warrant some to purchase a business aircraft late in the year, so closing the registry outside of normal business days could be problematic.”
NBAA noted an unprecedented volume of transactions in 2021, maximizing the number of deals closing at year-end. NBAA and the General Aviation Manufacturers Association (GAMA) are working with FAA leadership on “possible mitigations for year-end transactions.”
“Each aircraft transaction is unique,” added Scott O’Brien, NBAA senior director for public policy and advocacy, “and there are many aspects, from insurance to sales-tax planning to inspections, that can cause a delay. This can be further complicated if a lender is involved, and now with the prospect of the registry closing early on Dec. 30, it would be prudent for all parties to plan ahead and file all documentation before year-end.”