Unnecessary — Issue 007
A $170 Million Jet, Written Off
in a Single Year
The tax code doesn't just permit private jets. It actively subsidizes them. Here's exactly how the loophole works, and why closing it is harder than it sounds.
Buy a private jet worth $170 million, and under current U.S. tax law, you can deduct the entire purchase price from your taxable income in the same year you bought it. Not depreciated slowly over a decade like most business assets. Not partially expensed with some complicated formula. The whole thing, gone from your tax bill, in year one, provided you can plausibly claim the aircraft is used primarily for business.
This isn't a rumor, a loophole nobody's using, or an aggressive interpretation some accountant found in the fine print. It's a deliberate, named provision — 100% bonus depreciation — reinstated and expanded under 2025's tax legislation, and it applies to private aircraft the exact same way it applies to a delivery truck or a factory machine. The only difference is the size of the number, and with private jets, the size of the number is the entire point.
There's now a bill in Congress specifically targeting this. It's called, without any attempt at subtlety, the Stop Subsidizing Private Jets Act. Let's actually look at the mechanics of what it's trying to stop.
How the Write-Off Actually Works
Bonus depreciation exists, in its original and least controversial form, to encourage businesses to invest in equipment. Buy a piece of manufacturing machinery, and instead of spreading the tax deduction over the machine's useful life — five years, ten years, however long the IRS decides it lasts — you get to take the whole deduction immediately. It's a genuinely reasonable idea for genuinely productive business equipment. A factory that can write off a new assembly line immediately is a factory more likely to actually buy the assembly line, hire the people to run it, and start producing things sooner.
The problem is that the tax code doesn't meaningfully distinguish between a $2 million piece of manufacturing equipment and a $170 million Gulfstream, provided both are structured as qualifying business assets. Buy the jet through the right corporate structure, clear a 50% qualified-business-use threshold, and the aircraft becomes eligible for the same full first-year write-off as the assembly line.
Run the actual math on a real example. A $5 million aircraft, fully expensed under bonus depreciation, generates an estimated $1.8 million in tax savings depending on the owner's bracket. Scale that up to a $170 million ultra-long-range jet, and the tax savings alone can exceed $60 million in a single filing year — money that would otherwise have gone to the federal government, redirected instead into an asset the owner gets to keep, fly, and eventually sell.
Layer in Section 179 deductions on top, and the effective tax shelter gets even larger. This isn't creative accounting operating in a gray area. It's the tax code working exactly as written, for an asset class the code's authors either didn't anticipate at this valuation tier, or chose not to distinguish from ordinary business equipment.
The Asymmetry Nobody Advertises
Here's the number that makes the private jet tax conversation genuinely different from an ordinary "rich people get better tax treatment" complaint: private aircraft account for roughly one out of every six planes in American airspace, according to Institute for Policy Studies research. And despite that share of total air traffic, private jet operators contribute only about 2% of the taxes that fund the Federal Aviation Administration — the agency responsible for air traffic control, safety oversight, and the infrastructure every single aircraft in that airspace, private or commercial, actually depends on.
Compare that to how commercial passengers are taxed. Every ticket on a commercial flight carries a 7.5% federal excise tax specifically earmarked to fund the FAA's Airport and Airway Trust Fund. Fly commercial, and a meaningful chunk of your fare is directly subsidizing the same air traffic control infrastructure that private jets use constantly and fund minimally — private aircraft are taxed on fuel consumption rather than ticket value, and jet fuel taxes generate a tiny fraction of what an equivalent volume of commercial passenger tax revenue would produce.
The practical result: the person flying economy to see their family for the holidays is proportionally subsidizing more of the FAA's infrastructure budget than the person flying private to a board meeting in a $170 million aircraft they wrote off entirely last April.
The Bill, and What It Actually Targets
The Stop Subsidizing Private Jets Act, introduced by Representatives Eugene Vindman, Kristen McDonald Rivet, and Greg Landsman, is narrowly scoped in a way that's worth taking seriously rather than dismissing as political theater. It doesn't ban private aviation. It doesn't touch aircraft used for agriculture, firefighting, medical transport, flight instruction, skydiving operations, or scheduled commercial service — the carve-outs specifically protect the parts of private and business aviation that serve genuine operational or emergency functions rather than personal luxury travel dressed up as a business expense.
What it targets is narrower and more specific: the bonus depreciation provision as it applies to aircraft purchased primarily for the kind of use that looks a lot more like a $170 million lifestyle upgrade than a genuine productivity investment. Representative Vindman's framing, in his own words, draws a direct line between what private jet buyers can deduct and what an ordinary taxpayer can't — nobody driving to work gets to deduct their gas, nobody buying groceries gets a receipt that reduces their taxable income, but someone buying a plane worth more than most people's lifetime earnings can zero out tens of millions in tax liability in a single filing.
Whether the bill passes is a separate question from whether the argument underneath it is sound. Bonus depreciation for private aircraft has survived multiple legislative cycles already, including a version that expired and was then reinstated and expanded in 2025's tax package — which tells you something about how durable this specific provision has proven to be, regardless of which party controls which chamber.
Why the Industry Will Fight This Hard
It's worth understanding the private aviation industry's actual counterargument, because it's not purely self-interested noise — there's a real economic case underneath it, even if it doesn't fully answer the equity concern.
The bonus depreciation provision has directly driven a documented surge in aircraft orders. Honeywell is forecasting a record 8,500 new business jet deliveries over the next decade, a number the industry credits substantially to the current tax treatment making aircraft ownership dramatically cheaper on an after-tax basis. Manufacturing jobs, maintenance jobs, charter operator jobs, and an entire ecosystem of aviation-adjacent small businesses — hangar operators, fuel suppliers, avionics technicians — sit downstream of that order volume. Washington State's own recent experiment with a private aircraft luxury tax produced exactly this dynamic in miniature: real businesses documented relocating flight operations across state lines specifically to avoid the new tax, deferred aircraft purchases, and furloughed maintenance staff, all before the tax had even fully taken effect.
That's a legitimate economic tension, not a manufactured one. Tax policy that makes an asset class more expensive to own generally does reduce the volume of that asset class being purchased, and reduced purchase volume genuinely does ripple through manufacturing and service employment. The honest version of this debate isn't "the industry is lying about job losses." It's "the country has to decide whether subsidizing that job creation through a tax mechanism this generous, on an asset class this exclusive, is the right tradeoff" — and reasonable people land in different places on that question depending on how much weight they put on equity versus industrial policy.
What Actually Happens Next
Aircraft purchased and placed into service between 2023 and 2026 remain eligible for accelerated depreciation at the currently legislated rates regardless of how this specific bill's fight plays out — meaning anyone who's already bought or is close to finalizing a purchase has a real incentive to close before any potential legislative change takes effect. The IRS has also, separately from this bill, already increased audit scrutiny specifically targeting organizations and high-net-worth individuals who've claimed the accelerated depreciation, particularly around the documentation proving genuine business use versus personal use dressed up as business use. Flight logs, ground itineraries, and receipts for on-ground activity between flights are all now standard audit targets — the era of loosely documented "business trips" that happen to end at a ski resort is quietly closing regardless of what happens with the broader legislative fight.
Whether the Stop Subsidizing Private Jets Act itself passes is genuinely uncertain — narrow, targeted tax bills aimed at a specific deduction used heavily by donor-class constituents have a difficult legislative history regardless of which party is in power. But the audit environment tightening in parallel suggests the era of casually generous private jet tax treatment, even if the statute itself survives, is entering a phase where actually using it requires a lot more paperwork than it used to.
The House of Kong Take
Coming Up — Issue 008
Rolex just killed the Pepsi. Eight years of production, one of the most recognizable references in watchmaking history, discontinued with zero replacement — and the secondary market is already repricing everything around it.
