Attention Aircraft Buyers!
On December 19th, 2014 the President signed the Tax Increase Prevention Act of 2014 which among other things extended the tax advantages of 2013 to the end of 2014 giving folks two weeks to execute on purchases that can radically change their 2014 tax bill.
The impact of this law is potentially huge for some people that are facing high tax bills for 2014 tax year. It allows the write off a plane for leaseback or business use with a $500k section 179 election value or the use of bonus depreciation. This means a last minute purchase of a plane could dramatically change what you pay in April.
Here are a few generic examples…
Buy a Diamond DA40 (see for sale listings) for business use or Leaseback at say $250,000 cash as an example (numerous price points available)
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Assume your combined Tax Rate is 40% = $100,000 LESS in taxes paid in April.
This means the cash flow cost of the purchase is only $150,000 for a new modern top of the line aircraft.
Or maybe a Diamond DA20 (see for sale listings) for Leaseback service at say $100,000.
We have promotions through December 31st for FREE stripes on select used units and FREE Delivery on New Units – Call for Details.
Again at a 40% bracket you’ll pay $40,000 less in taxes come April and the net cash flow cost of the plane is $60,000. The plane goes into service making you money so you get a plane, a tax deduction and income and further your aviation goals.
You can also receive 50% Bonus Depreciation in 2015 for orders placed before the end of 2014 for New Aircraft! You can combine buying a used unit and placing an order for a new unit trading in the used unit when the new comes in. The potential for tax savings if you can act now are tremendous!
Here is a document provided by an aviation tax group that provides the summary of options.
Important: Once you make a purchase we’ll show you how to roll this investment over to your next plane.
So if you are facing a large tax bill in April and you can use a plane for business you can:
1. Do nothing now and PAY MORE in taxes and then keep looking for a plane in 2015.
2. OR Buy a plane now, reduce your 2014 liability, enjoy the use of the plane and position to use the value invested in the plane as a trade later to move to your “next plane” potentially enjoying more tax advantaged depreciation in a future year.
The best combination is to buy a used plane now with delivery by year end and place an order for a new plane that will enjoy Bonus Depreciation in 2015 and apply the used plane as your trade in when the new plane arrives. This provides the best of all worlds!
Call us for help…we are working everyday and nights for the remainder of the year. Hotline is 919-349-1492.