Buying AircraftFractional/Jetcards

Business Aviation Advantages and Options

By February 22, 2022 No Comments
Business Aviation Advantage

Executive Summary

Below is an article that Lori McGee first published on Newsweek.com titled In the Era of COVID-19, Business Aviation Provides Significant Advantages

Business Aviation Options

Executives who dismissed the idea of private jet travel as too costly are reconsidering in the era of COVID-19. Using a private aircraft for business travel has always provided benefits, one of the biggest of which is time savings. Private aircraft make certain trips possible by eliminating waits at the airport, delivering passengers closer to their intended destination and fitting into an end-to-end method of traveling that maximizes an executive’s ability to focus on business throughout the trip.

By passing through smaller general-aviation terminals and controlling who is on the aircraft, executives can also reduce their potential exposure to COVID-19. This added benefit, which may mean an earlier return to business travel, is making the use of private aircraft much more attractive.

For those who are new to business aviation or looking to expand their use of private aircraft, it pays to consider all the options. Chartering a different aircraft for each trip is a great way to try out business aviation because it gives you the ability to select a different size and type of aircraft, and there is no long-term commitment.

Questions to Ask a Charter Provider

The aircraft available on the charter market range from single-engine piston aircraft that may be perfect for a single passenger who needs to reach a remote location in the same region to large-cabin business jets that are best for larger groups and international flights. No matter what type of aircraft you need, there are some basic questions you should ask to confirm that you are working with a reputable charter provider:

• Request a copy of the operator’s air carrier certificate, or look them up. The National Air Transportation Association provides a search tool linked to the FAA records.

• Ask about the operator’s experience, safety record, security and insurance, as well as whether they have completed an independent, third-party safety audit.

• Ask the operator how they handle flight disruptions, flight changes and other customer service issues.

Consider a Jet Card, Fractional Ownership or Co-Ownership

When the use of business aircraft extends beyond 25 hours a year, it may be time to consider options other than per-trip charters. Some charter companies offer discounted pricing or jet cards if a block of hours is purchased, typically starting at 25 flight hours. Fractional or co-ownership of an aircraft may be an attractive option for those who need more than 50 hours per year. For those who need 150 hours or more in a year, the tax and economic benefits can make full ownership of an aircraft the right choice.

Considerations when Purchasing Your Own Aircraft

For a company making a long-term commitment to using business aircraft, there are several additional considerations, including balancing business goals, tax goals and regulatory compliance. There can be significant tax advantages to owning an aircraft, but tax advisors’ common strategies to maximize these advantages often run afoul of the unique regulatory requirements applicable to aircraft.

When considering purchasing an aircraft or fractional interest in an aircraft, it is best to evaluate these goals in advance with an experienced team, including aviation, business, tax and legal advisors. These advisors can help you identify and maximize the benefits and ensure regulatory compliance.

Lori McGee is a Partner with the aviation law firm of Jetstream Aviation Law, P.A. and counsel clients on the acquisition, financing and operation of corporate jets operated under Part 91 and Part 135 of the US Federal Aviation Regulations. Jetstream Aviation Law can be found at www.JetstreamLaw.com. Lori McGee (lmcgee@jetstreamlaw.com)

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