The new federal tax regulations that will take effect on Jan. 1 are mainly good news for aviation, according to AOPA and NBAA. The legislation passed this week will “directly lead to growth for the general aviation industry,” said NBAA President Ed Bolen. For example, the new rules allow for “immediate expensing,” Bolen said, which allows taxpayers to claim a 100-percent expense when they buy either factory-new or pre-owned aircraft. AOPA President Mark Baker also welcomed this change. “We think the inclusion of immediate expensing for used as well as new investments will effectively spur economic growth and create good jobs, especially in aviation and the aircraft industry,” he said.
AOPA noted that another provision of the bill does away with a tax-planning tool often used by those purchasing aircraft for business, known as the “like-kind” orSection 1031 exchange. According to AOPA, “limiting the immediate tax break to only new assets and aircraft while simultaneously doing away with the benefit of like-kind exchanges, could actually hurt jobs and large segments of the aviation industry instead of generating the intended investment.”