Other Aspects Of The 2017 Tax Cuts And Jobs Act Impacting Business Aviation

In addition to clarifying the exemption of aircraft management services from FET (which I discussed in my February 9, 2018 post), the 2017 Tax Cuts and Jobs Act (the "Act") also included several other provisions with a direct impact on business aviation: Repeal of 1031 Like-Kind Exchanges for Aircraft and Other Personal Property. Aircraft owners will now no longer be able to take advantage of the benefits of a Section 1031 like-kind exchange to defer the recognition of gain on an aircraft used in trade or business when it is sold and replaced with similar/like-kind property. However, if a 1031 exchange was initiated before 12/31/2017, then the exchange may still be completed. For tax planning purposes, it is anticipated that the advantage of the 100% expensing (at least until 1/1/2023) discussed below should offset the loss of the 1031 exchange mechanism. 100% Expensing of Purchase Price of Business Aircraft. Purchasers of business aircraft (e.g. purchase of an…

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