2011 Tax deduction

Jaybird180

Jaybird180

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Jaybird180
I'm reading controller.com and a guy selling his plane is talking about the buyer qualifying for a deduction in 2011 as part of a "new law".

I'd heard about the 2010 deduction but thought that applied to new aircraft only (not sure), where you can depreciate 100% over 8yr period.

Can anyone give a layman's of this law and potentially how long it may be good for? Also, does this depreciation allowance also apply to used airplanes?

Thanks
-a future owner
 
The unnecessarily long-titled Tax Relief, Unemployment Insurance Reauthorization, and Jobs Creation Act that was signed into law on 12/17/10 allows for the full expensing of eligible property placed in service after 9/8/10 and before 1/1/12 (or 1/1/13 for certain aircraft with long production periods.)

All this presume that you use the airplane for business, or at least >50% for business. Also, you must be the original user of the property, so used aircraft cannot be expensed in this way. Demos may qualify, however.

If full expensing is not utilized, the business use portion of the aircraft can be depreciated over 5 years on an accelerated (i.e. not straight-line) basis.
 
Thanks for the reply.

Geez, I thought this topic would really generate some interest (PUN intended)
 
Jaybird180 said:
Geez, I thought this topic would really generate some interest (PUN intended)
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I don't think many people here are in the market for a new business aircraft, especially when there are so many less expensive used aircraft on the market.
 
Everskyward said:
I don't think many people here are in the market for a new business aircraft, especially when there are so many less expensive used aircraft on the market.
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True, but note that you can also use the accelerated depreciation for an upgrade to an existing business aircraft, for example an overhaul.
 
This tax benefit always seemed to me to be a way to keep the manufacturers going, just barely.

But if they really wanted aviation manufacturing to thrive, not just survive, the politicians would offer significant depreciation schedules for non-commercial use.

It wouldn't go over well with those who holler and scream about the "rich people" not paying their fair share in taxes, though... I know. I know. But it would help their job numbers... it takes people to keep airplanes aloft.

When most new aircraft cost significantly more than my house did, I still predict dire straights for the light aircraft manufacturers for some time to come.

I love Cessna, but comparing a nice straight well-maintained used 182 from the pre-restart to the later models, you can't make the numbers work.

(You also don't have to deal with draining a million little fuel sumps the lawyers put on the stupid things, either.)

Just dreamin'... Cash for Clunkers was certainly a mixed bag economically for auto-manufacturers, but an incentive for aircraft that would NOT require the destruction of a perfectly good older asset to move folks along the upgrade path, wouldn't hurt anything but government "revenues" temporarily until they found some other way to siphon the cash direct from our wallets. ;)

I don't see any alphabet groups pushing for such a concession, though. Too bad, really.
 
Why can't I get a piece of that action? I paid top $$ (like the idiot I am). Why shouldn't I, for buying a high-end aircraft, get a tax benny???? Bastards!
 
Aviation needs a Henry Ford, someone who can build the Ford Taurus of airplanes for, say, $75k. Something that can fit four people and modest luggage comfortably, have reasonable speed and fuel economy, and capable of handling most things other than ice and thunderstorms. Do that and succed where the LSAs failed, and you'll revitalize aviation and bring it to the people.

The Aztec and 310 cost more per hour in maintenance and engine reserves than they do in fuel. How many cars can you say the same for? None that I've owned, and I've owned a number of Jaguars...
 
Ted DuPuis said:
Aviation needs a Henry Ford, someone who can build the Ford Taurus of airplanes for, say, $75k. Something that can fit four people and modest luggage comfortably, have reasonable speed and fuel economy, and capable of handling most things other than ice and thunderstorms. Do that and succed where the LSAs failed, and you'll revitalize aviation and bring it to the people.

The Aztec and 310 cost more per hour in maintenance and engine reserves than they do in fuel. How many cars can you say the same for? None that I've owned, and I've owned a number of Jaguars...
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the 182 fits most of those requirements mostly the price doesn't fit.

I think the biggest problem with airplanes is the price of parts doesn't exactly fit the bill I mean I understand they have different standards and different quality and much different tests...

As far as I've seen you can pretty much guesstimate the price of a part by taking what the price would cost for a car and multiplying by 5. It's been pretty consistent so far. Alternator 100 for your car? Probably 500 for your plane.

I think the real key would be to lower the price of parts by, like what you said, releasing a "taurus" that would really bring the parts cost down because of commonality (think honda). The same way it's easy to find cheap parts for a 172, but go get something for a not so popular simple piston single and you'll be lucky to only pay twice the price of the 172 part.

But of course to do that we need to stop closing airports in this country
 
Ted DuPuis said:
Aviation needs a Henry Ford, someone who can build the Ford Taurus of airplanes for, say, $75k. Something that can fit four people and modest luggage comfortably, have reasonable speed and fuel economy, and capable of handling most things other than ice and thunderstorms. Do that and succed where the LSAs failed, and you'll revitalize aviation and bring it to the people.

The Aztec and 310 cost more per hour in maintenance and engine reserves than they do in fuel. How many cars can you say the same for? None that I've owned, and I've owned a number of Jaguars...
Click to expand...

Be careful what you wish for... Can you imagine 10 times as many airports, and then each trying to accommodate 1000 operations per day, and not to mention the traffic in the air?
 
skidoo said:
Be careful what you wish for... Can you imagine 10 times as many airports, and then each trying to accommodate 1000 operations per day, and not to mention the traffic in the air?
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As someone at work would say... "That would be a high-quality problem to have."
 
skidoo said:
Be careful what you wish for... Can you imagine 10 times as many airports, and then each trying to accommodate 1000 operations per day, and not to mention the traffic in the air?
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That's not the reality of how it would work. People wouldn't use aviation like they use cars, just like they don't today.

The reason why aviation is underutilized is because it's too expensive for a good portion of the populus. Get the prices down, more people will use it, which get volumes up, which make prices go further down. You get the idea.
 
Ted DuPuis said:
That's not the reality of how it would work. People wouldn't use aviation like they use cars, just like they don't today.

The reason why aviation is underutilized is because it's too expensive for a good portion of the populus. Get the prices down, more people will use it, which get volumes up, which make prices go further down. You get the idea.
Click to expand...

That is sort of my point. If you get the prices down to increase volume and thereby get prices down further, eventually it will balance out, but at a higher volume. Suppose you could do it at affordable prices for most everyone such as Ford did for the car. Then, the limiting factor may not be price any more, but rather there will be those who chose not to participate simply because of no longer desiring to dodge traffic every few seconds, and waiting in long lines for your turn at the runway. And safety would be a nightmare, thereby count on more extreme regulations, etc...
 
Ted DuPuis said:
Aviation needs a Henry Ford, someone who can build the Ford Taurus of airplanes for, say, $75k. Something that can fit four people and modest luggage comfortably, have reasonable speed and fuel economy, and capable of handling most things other than ice and thunderstorms. Do that and succed where the LSAs failed, and you'll revitalize aviation and bring it to the people.
Click to expand...

elmetal said:
the 182 fits most of those requirements mostly the price doesn't fit.
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I was gonna say - Cessna is the Ford of aviation. Unfortunately, with that $480,000,000 seat rail lawsuit they need to pay off... :frown2:

Lawsuits will kill this country. We need reform.
 
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