100% bonus depreciation is back! This is certainly an excellent time to consider an initial purchase or even an upgrade. However, a multitude of considerations such as timing, usage profiles, and management are key factors to carefully sort through; and quickly if buying in 2025.
With the bonus depreciation schedule set to reduce to 40% in 2025, the new Act’s extension of 100% bonus depreciation for aircraft purchases in 2025 is a game-changer. The aircraft sales market has been relatively flat from ‘24-’25. JETNET.com data reflects average units up a little more than 10%, average sales price remaining near $7.5M, and average days on the market stretching from the high 100’s to roughly 220 days. This is certainly going to change and perhaps rapidly. An uptick in transaction activity to close 2025 will certainly apply pressure on all parties, especially for those seeking to qualify for private jet bonus depreciation benefits by year-end.
Financial institutions, attorneys, maintenance facilities for pre-purchase inspections (PPI), and management firms will all be tasked with timely and efficient execution in support of these transactions. In addition, the FAA plays a role with various authorizations for both Part 91 and Part 135 arrangements with the aircraft, and the processing time with the FAA can be unpredictable and or inconsistent. An experienced management firm can certainly help in terms of mitigating some delays with guaranteed PPI slots, self-conforming capabilities, and a strong command of the administrative /communication process. If the goal is to accomplish a qualifying 2025 purchase (purchased and placed in service by year-end), the earlier the process is started, the better.
In addition to the 100% depreciation announcement, some favorability is starting to present itself with general aviation aircraft insurance. Management firms with scale, audited safety programs, and operational history are able to leverage premium policies at market leading rates. In a recent conversation with Todd Guelich, Senior VP Assured Partners, he shared his insightful outlook: “Even though the airline insurance market continues marching through another difficult renewal season, the general aviation sector, especially those policies written for a fleet of managed (135 and 91 uses) aircraft have experienced measurable relief during the first two quarters of 2025. These improvements are led by the top tier underwriters restoring multiple coverages withheld over the previous 5 years. Inclusive of limit increases, deductible relief and expansion of ancillary endorsements, this new liberal expansion of available products are complimented by stable premiums that have all but eliminated the increases experienced during the previous year’s renewals. All signs point to a continuation of this competitive approach through the remaining quarters of 2025 and beyond”.
When considering Part 135 management, several additional factors must be evaluated. Adding an aircraft to an FAA Part 135 certificate, allowing for charter and commercial use, requires time and involves additional steps for training and conforming the aircraft to the management firm’s standards. Estimates of anticipated business and/or personal usage must be determined, as well as the availability and flexibility of the aircraft to ensure proper crewing and positioning for revenue goals. Other considerations include evaluating or upgrading the Wi-Fi system, refreshing the interior or paint, and planning for aircraft base logistics (or a floating model), crew composition, and maintenance or program needs.
Management firms can have a varied history and approach to supporting an aircraft and sourcing charter revenue, and this needs to be understood by the aircraft owner. It is essential for firms to have a strong command and control of the regulatory, operational, and safety aspects of operating an aircraft. Likewise, the financial oversight and care of the asset is critical; leveraging a strong system of controls, accounting, and financial reporting. In addition, understanding the procurement capabilities and relationships with major partners in the areas of pilot training, fuel procurement, maintenance, insurance, logistics management, and FBOs for operations and facilities. With these must-have items satisfied, the next major consideration is an understanding of how charter is sourced and the full picture of the economics being applied against the aircraft.
Specific to charter economics, there are many approaches. Many firms will simply market the aircraft to the wholesale charter brokerage community and will then split the revenue 85/15 (or similar), with the 85% intended to cover the direct operating cost incurred by the owner, leaving the net proceeds as a benefit. This model keeps the upside in play for both parties, but without any guarantees tied to an established end market, this also carries risk. It is worth covering the often misunderstood 15% to the firm. The 15% is to cover expenses related to the marketing of the aircraft, supporting personnel (operations, client services, safety, training, admin, pilot and maintenance leadership, etc) and the business services to support it (legal for contracting, finance for AP & AR, IT as applicable for systems support, general leadership, infrastructure, etc). A small portion of this is supported by the monthly aircraft management fee, but those relatively small fees are generally intended to cover the ongoing direct administrative oversight and compliance of the aircraft and do not support the full ecosystem of a deeply resourced and highly capable management firm.
Other firms offer a variety of leaseback arrangements or guarantees. It is important to understand that this is generally afforded by two common means. The first is simply a method of low-capital fleet growth for the operator to fuel market presence against wholesale or even retail demand, by leveraging the owners capital to acquire the aircraft and then utilizing it for commercial success. This can provide the owner with a comfortable fixed financial situation, as long as the owner is comfortable with the economic upside and advantages shifting to the firm. The other is typically a well established or rapidly growing retail situation for a firm and rapid fleet expansion is needed and cannot be filled quick enough or economically by OEM new aircraft deliveries. A few other examples have been seen in the marketplace such as a growth strategy prior to demand being established; with firms attempting to fuel fleet growth via these aggressive /higher risk offerings (and then pressured to find the charter to make up for the committed expense). All of these have proven to be somewhat cyclical in nature for most, with varying degrees of satisfaction for the firm and the owner depending on the economic conditions, charter market, and aircraft valuations.
A firm with stable economics, a defined operating history, and well established retail demand (the kind suited towards the aircraft type and situation being presented for management) typically yields the best value proposition to arrange for comfortable charter guarantees and mutual economic reward with the aircraft owner. Oftentimes, it is possible to arrange for the right aircraft to match an owner's needs and that of an existing firm's retail environment. This establishes a win-win situation, with economics and associated guarantees well defined in a pro forma at the point of commitment and contracting.
So, planning to buy in 2025 and take advantage of aircraft bonus depreciation 2025 before the schedule changes?
Do you have your aircraft of choice narrowed down, matched to the right aircraft brokerage and management firm and the search underway? Do you have your key legal and financial advisors? Have you protected your PPI slot?
No pressure, but the clock is ticking.
There are many excellent professionals associated with this industry; all ready to assist and provide a rewarding aircraft ownership experience. The team at Elevate Jet has done just that for 30 years, and is available worldwide 24/7.
For aircraft acquisition, management inquiries, or more information on aircraft pre-purchase inspection slots, contact: sales@elevatejet.com
What is 100% bonus depreciation for aircraft in 2025?
A: Bonus depreciation allows aircraft buyers to deduct 100% of the purchase price of qualifying aircraft in the year it is placed in service. The 2025 extension means buyers can fully expense eligible aircraft, making it one of the most favorable tax opportunities in private aviation.
How long will 100% aircraft bonus depreciation last?
A: Under the current law, 100% bonus depreciation applies to aircraft purchased and placed in service after January 19, 2025. After 2025, the rate is scheduled to phase down, with only 40% depreciation originally set for 2025 without the extension.
Does Part 135 charter impact eligibility for aircraft bonus depreciation?
A: No — aircraft used for business purposes, whether under Part 91 or Part 135 management, may qualify for bonus depreciation. However, the structure of usage and compliance with FAA regulations must be carefully managed to maintain eligibility.
Why consider private jet bonus depreciation in 2025?
A: With a flat sales market and favorable insurance and financing conditions, 2025 represents a unique moment to maximize tax benefits while acquiring or upgrading aircraft. The ability to deduct 100% of the cost in year one significantly improves ownership economics.
About the Author: Randy McKinney President & CFO of Elevate Aviation Group
Supporting Private Jet Services, Elevate Jet, and Elevate MRO. Randy brings a passion for flying, safe and efficient operations, excellent customer experiences, and building strong and supportive team environments.
Prior to joining Elevate, Randy served as the Chief Operating Officer for JSX, supporting Flight Operations, Aircraft Maintenance, Hospitality, Mission Control, and Engineering & Reliability. Mckinney brings over 20 years of commercial, private, and general aviation experience to EAG. Randy has held multiple escalating leadership roles that spanned large airline HUB operations, private jet account management, and senior leadership for large-scale customer service and maintenance operations. His professional career was largely developed over 18 years in the Delta Air Lines family and culminated as the Chief Operating Officer for Delta Global Services. Two years were served with NetJets in support of customer service and vendor management.
Randy is an Alumni of Harvard Business School along with undergraduate and executive education accomplishments from Purdue University, Notre Dame Mendoza College of Business, University of Michigan College of Engineering, Buffalo University, and the University of South Carolina.
About Elevate Jet:
Elevate Jet is a premier provider of tailored aviation services, delivering comprehensive solutions that have redefined private air travel for 30 years. With a client-first approach and a commitment to excellence, Elevate Jet specializes in aircraft management, aircraft sales, and consulting, ensuring a seamless and personalized aviation experience. Our team of seasoned professionals brings deep industry expertise and a passion for innovation, offering strategic insights and operational efficiency to meet the unique needs of every client. From managing your aircraft with meticulous care to providing unparalleled access to a global charter network, Elevate Jet is dedicated to enhancing safety, reliability, and efficiency at every step.
About Elevate Aviation Group:
Elevate Aviation Group is a fully integrated aviation services platform offering its clients aircraft management, charter operations, aircraft acquisition and disposition, aircraft maintenance, and aviation consultancy. With 30 years of industry experience and offices on four continents, Elevate Aviation solves mission-critical logistics for clients, flying some of the world’s largest entertainment acts, Fortune 500 Companies, and professional sports teams. Our commitment to a client-first approach is evident in our enduring relationships, as we proudly continue to serve our very first customer. With a focus on safety, efficiency, and customer satisfaction, Elevate Aviation delivers tailored solutions that meet the diverse needs of clients worldwide, reflecting our dedication to exceptional service and hospitality while raising standards across the aviation sector through innovative practices.
Press inquiries contact +1(603)760-0500 or email grace.carlon@eag.aero.
