Tax savings estimator
Estimate federal and state tax savings from aircraft depreciation under current law — MACRS 5/7-year, 100% bonus (OBBBA 2025), Section 179, and 50-state conformity. For educational use; not a substitute for a CPA.
How this calculator works
Aircraft used in a trade or business are depreciable assets under IRC Section 167/168. Private aircraft operated under Part 91 use a 5-year MACRS recovery period; charter aircraft under Part 135 use a 7-year MACRS recovery period. Applicable percentage tables come from IRS Publication 946.
The One Big Beautiful Bill Act (OBBBA), signed in 2025, permanently restored 100% first-year bonus depreciation under §168(k), retroactive to property placed in service after January 20, 2025. For 2023 and 2024, the TCJA phase-down applies (80% and 60% respectively).
Section 179 allows an election to expense up to $2,500,000 of the cost in the first year (OBBBA limit), subject to a dollar-for-dollar phase-out beginning at $4,000,000 total placed-in-service cost. §179 is taken before bonus depreciation.
The convention determines how much depreciation is allowed in the first and last recovery years. The half-year convention (default) treats property as placed in service at the midpoint of the year. If more than 40% of depreciable assets are placed in service in Q4, the mid-quarter convention applies — we flag the risk but the schedule shown still uses the standard half-year tables.
If business use drops below 50%, Section 280F requires the Alternative Depreciation System (ADS) with straight-line recovery — 6 years for Part 91, 12 years for Part 135 — and disallows both bonus and §179.
State conformity varies. Some states (CA, NY, NJ, PA, and others) require an add-back of federal bonus and may cap Section 179. This calculator models state-specific rules for all 50 states + DC.
Disclaimer: This is an educational estimator only. It does not constitute tax advice. Consult a qualified aviation tax professional or CPA for your specific situation. Actual tax treatment may vary based on facts and circumstances not modeled here.
Frequently asked questions
How much depreciation can I take in year one under OBBBA?
The One Big Beautiful Bill Act (OBBBA), signed in 2025, permanently restored 100% first-year bonus depreciation under Section 168(k) for property placed in service after January 20, 2025. A qualifying business-use aircraft can be fully deducted in the year of purchase, subject to the 50% qualified business use test in §280F.
What's the difference between Part 91 and Part 135 depreciation?
Part 91 (private operation) uses a 5-year MACRS recovery period; Part 135 (charter operation) uses 7-year MACRS. The applicable percentage tables come from IRS Publication 946. Both are eligible for bonus depreciation and Section 179 if the 50% business-use test is met.
What is Section 179 and when should I use it?
Section 179 lets you elect to expense up to $2.5M (OBBBA limit) of the cost in the first year, with a dollar-for-dollar phase-out beginning at $4M of placed-in-service property. §179 is taken before bonus depreciation. For aircraft above the phase-out range, bonus depreciation usually does the same work without the cap.
What happens if business use drops below 50%?
IRC §280F kicks in. The aircraft switches to ADS straight-line recovery (6 years for Part 91, 12 years for Part 135), bonus depreciation and §179 are disallowed, and you may face depreciation recapture on deductions already taken. The calculator flags this scenario but a CPA should model the recapture risk specifically.
Do all states conform to federal bonus depreciation?
No. Several states — California, New York, New Jersey, Pennsylvania, Massachusetts, and others — require an add-back of federal bonus and may cap Section 179 at a lower number than federal. This calculator models state-specific rules for all 50 states + DC, but state savings are an estimate. Confirm with a state-tax-savvy advisor.
Is this calculator a substitute for a CPA?
No. It's an educational estimator. It does not model AMT, NOL limitations, §163(j) interest limits, the recapture schedule, 280F-ADS edge cases, or state-bonus decoupling timing. Every aircraft purchase should be structured with an aviation tax advisor before close.