100% Bonus Depreciation for Aircraft: IRS Guidance Explained
Angel Houck breaks down new IRS guidance on 100% bonus depreciation for aircraft, what stayed the same under the OBBB, and where owners still need to be careful before taking deductions.
On Jan 14, 2026, the IRS released Notice 2026-11, which provides additional guidance on the 100% bonus depreciation that was brought back by the One, Big, Beautiful Bill (OBBB). In this case, no news is good news. Although the notice includes clarifying language for some specific assets, like sound recording equipment and specified plants, the rules related to aircraft remain in line with our interpretations from the original bill with no surprises.
To recap the OBBB and the depreciation allowed for assets acquired after January 19, 2025, we have the following: Aircraft that meet certain criteria for MARCS depreciation may be eligible to write off the full cost of the aircraft in the year it is placed in service – known as 100% bonus depreciation.
Taxpayers may elect to use the phase-down depreciation rates that were previously provided in the Tax Cuts and Jobs Act for aircraft placed in service in 2025, allowing for either 40% or 60% bonus depreciation.
Keep in mind, bonus depreciation is not automatic and comes with a number of
conditions that must be met; and even if the aircraft qualifies for bonus depreciation, the deduction will be limited if there is personal use of the aircraft in the year it is placed in service. The rules become even more complicated if you had a contract to purchase an aircraft before January 19, 2025, and it was placed in service on or after that date.
If you are going to purchase an aircraft, and bonus depreciation is important to your tax planning, you should consult an aviation tax advisor early in the process to make sure that the conditions are met. If you have already purchased an aircraft in 2025 or 2026, make sure that you carefully review the rules before taking depreciation on your tax return.
Can I Change My Aviation Insurance Broker?
Tom Hauge answers a question he hears every January: how do you change your aviation insurance broker without burning bridges or losing leverage? He explains when to make the move, how broker-of-record letters work, and why timing matters more than most owners realize.
The aviation insurance business operates a bit differently in the commercial and turbine space, in that the insurers require you to work with a broker who represents you and your policy. Most aviation insurers only permit one broker to shop your policy – as such, you need to engage a ‘broker of record’ to represent your policy interests to the 20+ aviation underwriting (insurers) companies in the space.
The broker of record (BOR) letter is the vehicle through which you formally engage an aviation insurance broker. The letter functions much the same way an ‘engagement letter’ works with hiring an attorney or a tax advisor. Once you sign a broker of record letter, it informs the aviation underwriting companies that you have engaged broker XYZ to fully represent your insurance interests in the market or only partially represent your interest (with select insurers so designated on the letterhead).
A good time to engage a new broker if you are looking for new representation is in the renewal cycle queue, which is roughly 60-90 days before your policy renewal date. By changing brokers within that window, you are not only allowing your ‘new’ broker time to review your risk thoroughly thus properly shopping your policy to the market but also providing a professional courtesy to the broker you are moving away from (ie they haven’t invested much time, if any, in shopping your renewal only to be replaced as a broker of record).
I think it’s important to note that you do not want to hire a new broker AFTER your current broker has already shopped your policy in the marketplace – this is for a couple of reasons. Insurers will not change their quotes to your new broker after they have already been released to the broker you are moving away from. Second – if you sign a broker of record letter for a new broker after your current broker shops the policy, you have effectively fired them AFTER they completed the work of shopping your policy to the market. Essentially, engaging someone for a service, but with no compensation after that service has been performed on your behalf.
You can, however, change your broker of record at any time during the policy period. There are cases where something like poor service warrants a change in broker mid-policy. So it’s important to understand that the ideal time to change brokers is in the renewal queue (60-90 days before renewal), but you can change at any time, provided your current broker is made whole – meaning the policy premium has been paid and the broker commission paid to the broker you intend to move away from.
2025 Year-End Review and 2026 Outlook
Mike Smith looks back at a volatile 2025—tariffs, tax policy, and rate shifts—and explains what those lessons mean for aircraft financing as owners head into an uncertain but opportunity-filled 2026.
As we push toward the end of January, I want to wish you one last “happy new year!” from Columbus, Ohio. The Scope team is mostly recovered from what turned out to be a very strong 2025. Looking back at the year, it’s incredible to see how it ended after how it started.
If you go into the way-back machine, you’d remember that, at the start of 2025, there was tremendous optimism that the Trump administration was going to jump-start the economy with favorable tax policy, and in our industry, that meant a rapid return to the accelerated depreciation schedules of yesteryear. The industry saw a lot of 2024 closing volume pull forward into 2025 which resulted in a busy January for all.
As the calendar turned to spring, we all pulled out our high school US history books to remember what the word “tariff” meant and how it worked. Second quarter was a quarter of learning and navigating as tariff policy changed daily, with a new dynamic of including aircraft transactions.
As we were dealing with this new big, beautiful reality, a better use of the adjectives “big and beautiful” came out with the “One Big Beautiful Bill Act,” where Congress passed the much-anticipated tax law changes forecasted in January. That, coupled with tariff clarity throughout the third quarter, set up the stage for an incredible “last third” of 2025.
From an interest rate perspective, we saw the Federal Reserve lower its benchmark rate three times in 2025, which resulted in a downward shift in rates. We also saw tension between the Fed Chair Jay Powell and President Trump reach a new high, which further peaked in early January, with the announcement of a federal investigation into Jay Powell.
So, what can 2025 teach us about 2026? Expect change and transition. Chair Powell’s term expires in May 2026, and President Trump is close to nominating his successor. While that may have an impact on rates, the Fed ended 2025 the most divided it’s been in decades, with three board members voting against the rest with their December rate cut vote.
Tariff policy has settled out, especially on the aircraft transaction side of things (for conversation’s sake, I’m not even going to touch the Greenland situation). Bigger picture, tariff impacts take time to work through the economy. So don’t underestimate the impact aircraft owners may feel in their own businesses.
And, as we continue to see, geopolitical dynamics remain uncertain, and that
always has the potential to impact various components of our and the world’s economy. 2025 showed us the value of regular connection and communication, so we can all remain informed and ready to navigate the world as it comes. That’s the spirit of The Plane Truth, and our goal as we look to provide timely finance updates and economic anecdotes as we work through 2026.
As we say at Scope, “here we go!!” I wish you a prosperous and fun 2026!
The $100M Question You Should Answer This Week
Dustin Cordier challenges aviation business owners to stop confusing motion with progress. He introduces the $100M Question—a single forcing decision that reveals where focus truly belongs and why disciplined selection, not ambition, is what builds enterprise value.
January hands you something rare: a clean slate and the permission to rethink everything. Most aviation business owners squander it by creating a long list of goals that ultimately cannibalize each other. They confuse activity with progress.
Here's the question that separates the owners who build enterprise value from those who stay trapped: What is the one thing that—if accomplished this year—would make your other goals either accomplished or irrelevant?
That's not a productivity hack. It's a forcing function for strategic clarity.
Alex Hormozi calls this the "$100M Question" and applies it ruthlessly to his own business every year. Greg McKeown, in Essentialism, frames it differently but arrives at the same conclusion: the disciplined pursuit of less always beats the undisciplined pursuit of more.
The visual is striking. Imagine the same amount of energy either spread across twelve priorities (making marginal progress on all of them) or concentrated on one (punching through to a breakthrough). Same effort. Radically different outcomes.
How to Find Your One Thing
This isn't about gut feel. Block 90 minutes this week and work through these four filters:
1. Define the Win in One Number. Pick the single outcome that would make December feel like a different business: EBITDA, qualified leads, dispatch reliability, billable utilization—one number, not a paragraph.
2. The Leverage Test. List everything you think matters for this year. Now ask: which one, if achieved, creates the conditions for the others to happen naturally—or makes them unnecessary? For an MRO, that might mean landing one anchor customer that stabilizes utilization. For a brokerage, it might be finally building a lead generation system that doesn't depend on your personal network. That's your domino.
3. The Constraint Question. What single bottleneck most limits your growth right now? In aviation, it's often key person dependency—the owner who touches every deal, every customer escalation, every vendor negotiation. Your one thing should directly attack that constraint.
4. The No-Fly List. If you commit to one thing, something has to stop. Write down what you will not do this quarter—projects, meetings, reports, "nice-to-haves." If nothing changes, you're not focusing; you're wishing.
Make It Real
Naming your one thing isn't enough. Assign a single owner who is accountable for the outcome. Hold a weekly review that asks only two questions: did the metric move, and what will you change this week to move it again?
Protect it like a maintenance slot: block the time first, let everything else compete for what's left.
Focus, as Hormozi puts it, is measured by the quality and quantity of things you say no to. January doesn't reward ambition. It rewards selection.
Pick the lever. Pull it until it moves.