Please ensure Javascript is enabled for purposes of website accessibility

Blog

Do I have to pay capital gains tax when I sell my plane?


 

Transcript:

The sale of a business aircraft typically results in a taxable gain arising out of the tax depreciation rules. As a long-lived asset, when a plane is purchased, its price cannot be simply written off, but it is depreciated over a number of years. The tax code specifies the depreciation rate and it is highly accelerated. General aviation aircraft can easily last 30 or 40 years, but most are depreciated over a five-year period, which means significant tax deductions in the first years of business operations. When it comes time to sell, the amount by which the tax depreciation has been greater than the plane’s actual loss in value will be a taxable gain, but not at capital gain rates. Instead, it is ordinary income. If the aircraft has truly appreciated, meaning it is sold for more than it was purchased for, then that amount and only that amount, will be treated as a capital gain.

Advocate Covers:

Our Results

Service Agreements

Small Piston Comprehensive Service Agreement

For Piston Aircraft with a gross takeoff weight of less than 6,000 lbs and costing less than $500,000 – $3,000 per year

Large Piston Comprehensive Service Agreement

For Piston Aircraft with a gross takeoff weight of more than 6,000 lbs or costing more than $500,000 – $5,000 per year

Small Turboprop Comprehensive Service Agreement

For Turboprop Aircraft with a gross takeoff weight of less than 12,500 lbs, and not subject to “truth in leasing” – $7,500 per year

Our Team

Meet the Attorneys

Jonathan Levy

Shareholder

Suzanne Meiners-Levy

Shareholder

Joseph Quackenbush

Managing Attorney

Letisha Bivins

Managing Attorney

Do you love aircraft? Work with our team of professionals!

Contact Us

Get in Touch
With Us

Get in Touch