On Monday, May 12, the House Ways and Means Committee released the first draft of its proposed tax reform bill, titled “One Big, Beautiful Bill.”
The first draft includes proposals on many anticipated items and introduces several new concepts.
It’s organized into four main sections:
- Subtitle A – Make American Families and Workers Thrive Again
- Subtitle B – Make Rural America and Main Street Grow Again
- Subtitle C – Make America Win Again
- Subtitle D – Increase the Debt Limit
Subtitle A
The first section of the bill focuses on individual taxes and credits. It proposes making most of the Tax Cuts and Jobs Act provisions permanent.Â
These include adjusted tax brackets, lower rates, increased standard deductions, enhanced child tax credits, and higher estate and gift tax exemptions.
The Qualified Business Income (QBI) deduction, which helps decrease the tax burden for many business owners, would also become permanent. The deduction rate would increase from 20% to 23%.
Unfortunately, many of the limitations on itemized deductions could also become permanent, including miscellaneous deductions. Â
Subtitle A of the bill also introduces new tax proposals. These include eliminating tax on tips and overtime, deducting car loan interest and offering new breaks for seniors. It also proposes a MAGA account, which appears to be similar to a 401(k) for children.
Subtitle BÂ
Here, we find what’s been top of mind for many aircraft owners: bonus depreciation. The Big, Beautiful Bill proposes that 100% bonus depreciation will become permanent, starting January 20, 2025.Â
Qualifying property requirements would remain similar to previous years. This move would eliminate the current phase-out.
Interestingly, there’s a proposal for bonus depreciation to apply to certain production property, including new and existing factories. This would be the first time that bonus depreciation would be available for real estate, and is in line with the overall tone of the bill that favors U.S. production, jobs and manufacturing.  Â
Another proposed change is increasing reporting thresholds on Forms 1099, which will reduce the reporting burden for many businesses.
Subtitle CÂ
This “Make America Win Again” section focuses on repealing many of the clean energy credits introduced in the Inflation Reduction Act of 2022. It also would repeal portions of the Affordable Care Act of 2010 (Obamacare).
Proposed repeals include clean vehicle credits, energy-efficient home improvements, and alternative fuel incentives. Changes to nuclear and hydrogen credits are also on the table.
A potential positive for personal-use aircraft owners is a proposed increase in the state and local tax deduction. It could allow many personal-use owners to deduct sales and use tax paid on their aircraft.  Â
However, the biggest hit that I’m disappointed to see is the proposal to make the Excess Business Loss (EBL) limitations permanent. This impacts many aircraft owners, as bonus depreciation losses often can’t offset non-business income like W-2 wages or investment earnings.
Further, the proposal would create an EBL rollover. The current law allows the excess loss to be included in the net operating loss in later years.
Subtitle DÂ
Lastly, this section includes only one goal: to raise the debt ceiling by $4 trillion.
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What It Means for Aircraft Owners
This first draft of “One Big, Beautiful Bill” includes several wins for aircraft owners—most notably, the push to make 100% bonus depreciation permanent. That’s a major incentive for those planning to buy aircraft after January 2025.
But it’s not all good news. Making the EBL limitation permanent could severely restrict how aircraft owners deduct depreciation losses against non-business income.
Bottom line: While the bill offers meaningful tax advantages, especially for aviation and manufacturing, it also introduces long-term limitations. Aircraft owners should work closely with their advisors now to plan ahead.
For the full text of the Big, Beautiful Bill and updates, visit this link.Â
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