The aviation industry is buzzing with opportunity following the passage of a new bill, named the “One Big Beautiful Bill” (BBB) by the Trump Administration, signed into law on July 4, 2025. This landmark legislation not only invests billions into modernizing U.S. airspace but also introduces significant tax incentives for businesses looking to refit their jets.
The One Big Beautiful Bill (BBB) permanently restores 100% bonus depreciation for qualifying business property. For business jet owners and operators, that means new and used aircraft purchases - and many avionics and safety retrofits - may be fully deducted in the year placed in service. For property placed in service on or after January 19, 2025, the entire qualifying cost can be written off in year one, rather than depreciated over several years.
New Tax Breaks for Business Jets
To qualify as a business jet according to Section 179, your aircraft must:
Be used more than 50% of the time for business purposes (employee transport, client visits, cargo delivery, etc.)
Be owned or leased by a business entity
Meet passenger capacity and operational range requirements
To claim bonus depreciation on aircraft and major components, it’s important to keep detailed logs and allocate mixed-use flights properly.
Before the new bill was signed into law, 100% bonus depreciation from the 2017 tax cuts was phasing down (generally 60% in 2024 and 40% in 2025, then 20% in 2026 and 0% in 2027). The bill's tax provisions restore 100% bonus depreciation for qualifying property placed in service on or after January 19, 2025.
As with prior law at its 100% peak, both new and used qualifying aircraft and retrofit components can qualify (subject to related-party and other standard restrictions).
Aircraft acquisitions and many retrofit assets (e.g., avionics, flight displays, data comms, TAWS) that are depreciable with a recovery period of 20 years or less generally qualify for bonus depreciation when used predominantly in business.
If you finance a business jet retrofit, loan interest is still deductible. Combined with the 100% bonus depreciation, this can dramatically reduce your net cost.
What the New Bill Didn't Change
Fuel, insurance, crew, hangar, maintenance, and routine safety items remain deductible as ordinary and necessary business expenses when tied to qualified business use. Entertainment/personal use rules under Section 274 still limit or disallow portions of these costs.
Interest on financing remains deductible as business interest, subject to the 163(j) limitation. Note the interaction: expensing 100% of a large retrofit can lower your adjusted taxable income in year one, which may defer some interest deductions under 163(j). Disallowed interest carries forward.
The aircraft does not need to be owned by a corporation to qualify; individuals, LLCs, and corporations can all qualify if the aircraft is used in an active trade or business.
Always consult a CPA for personalized tax guidance. These incentives can significantly lower the effective cost of modernizing your jet, but the rules are complex.
Maximize Your Business Jet with Universal Avionics Retrofit Solutions
Flight Management System (FMS)
- Precision navigation, automated flight planning, and regulatory compliance
- Improves fuel efficiency and reduces operating costs
- Fully deductible when installed as part of a qualifying safety upgrade
InSight™ Integrated Flight Display System
- High-resolution, customizable displays for better situational awareness
- Reduces cockpit clutter and pilot fatigue
- Modernizes older jets without extensive structural modifications
UniLink® Data Communications System
- Enables CPDLC and ADS-C for seamless communication with ATC
- Enhances efficiency in congested airspace and supports NextGen compliance
Terrain Awareness and Warning System (TAWS)
- Delivers proactive terrain, obstacle, and runway alerts
- Improves safety and meets FAA/EASA mandates
Why Upgrade Now?
The BBB’s 100% bonus depreciation is a limited-time opportunity, always subject to future changes in Washington just like previous tax breaks and incentives. Acting now allows operators to modernize flight decks at a lower net cost, improve operational efficiency and safety and boost aircraft value while meeting compliance requirements.
Contact Universal Avionics today to discuss how our FMS, InSight, and other avionics can be tailored to your fleet.
Book a consultation with our experts, and craft a retrofit plan that maximizes your tax breaks while elevating your aviation experience. Visit our website or reach out directly to one of our dealers to get started.
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