Tax insight

Aircraft Quarterly Newsletter – Q4 2025

Insight
5 minute read
December 02, 2025

What happened?

Given the IRS’s continued initiative on auditing the use of business aircraft, companies should be aware of potential pitfalls for federal income tax purposes.

Why is it relevant?

Failure to properly apply the federal income tax rules regarding aircraft use may adversely affect both employers and their employees.

Action to consider 

With year-end rapidly approaching, companies may want to manage their audit risk by reviewing their business aircraft use during the tax year in the context of significant applicable tax provisions. These provisions include rules relating to (1) imputing income to employees for personal aircraft use; (2) deduction disallowances for entertainment use of aircraft by specified individuals, employee commuting expenses, and failure to adequately substantiate expenses; and (3) meeting the Section 280F qualified business use test for depreciation purposes, including bonus depreciation.