Buying an aircraft is a major financial decision. The legal structure behind that purchase determines how well your assets are protected and how much tax benefit you capture.
Allegis Law provides aircraft ownership legal services to business owners and high-net-worth individuals nationwide. We design aircraft ownership arrangements that align with FAA rules, support legitimate tax deductions, including Section 179 and bonus depreciation, and integrate your aircraft into a broader asset protection and estate planning strategy.
Acquiring an aircraft is one decision. Managing the tax exposure, operational compliance, and ownership structure over its lifetime is another. Allegis Law handles both from the start.
Aircraft purchases often move quickly. The legal consequences last for decades.
Are you certain your aircraft ownership structure shields your personal assets if an aviation liability claim arises?
If you plan to claim depreciation, do you have the entity, documentation, and usage records required under IRS Publication 946?
Will your current estate plan properly transfer your aircraft without probate complications or unintended tax exposure?
Mistakes in structure, registration, or documentation often surface long after closing. Fixing them later can be expensive and disruptive.
At Allegis Law, we approach aircraft ownership from three angles.
Entity selection affects liability exposure, operational flexibility, and tax reporting. A single-member LLC, a multi-member LLC, or an operating company arrangement each carries different implications. We design aircraft ownership arrangements that align with your broader business framework, including support from our business formation attorney services.
Aircraft must be registered correctly through the FAA Aircraft Registry. Ownership eligibility rules apply to both individuals and entities, and the ownership entity must be in place before registration to avoid delays or complications. We design that entity to support a clean registration outcome.
Aircraft used in business may qualify for Section 179 expensing or bonus depreciation when properly structured and documented. We apply the same analytical framework used in our work on Section 179 vs. bonus depreciation for equipment and equipment purchase tax benefits. Our guidance aligns your aircraft purchase with legitimate business use requirements and passive activity rules to protect your deductions.
The lease structure also determines how income from the aircraft is classified. Dry lease and wet lease arrangements carry different tax consequences, and the wrong choice can limit the ability to use losses against ordinary income. Lease structure selection is part of the ownership planning process, not a detail to resolve after closing.
Aircraft ownership decisions also connect to your asset protection strategy, estate planning structure, and, where applicable, your business succession plan. We address all of it as part of one coordinated engagement.
Whether an aircraft operates under FAA Part 91 or Part 135 is not only a regulatory question. The classification directly shapes ownership structure, income classification, and tax treatment.
Part 91 governs private, non-commercial operations. Under Part 91, the owner controls the flight crew, and federal excise tax does not apply to most operating structures. Part 91 does not permit compensation or reimbursement for flights, which limits revenue options but preserves simpler operational control.
Part 135 applies when an aircraft is used for commercial charter or revenue flights. Under Part 135, the charter operator holds operational control and assumes legal and safety responsibilities for commercial flights, reducing the owner's personal exposure while imposing stricter FAA requirements and higher insurance standards. Owners who place an aircraft on a Part 135 certificate can make it available for charter to offset ownership costs, but that income is classified and taxed differently than passive rental income.
The entity selected to hold the aircraft, the lease arrangement in place, and the intended operational use must all align from the start. Resolving a liability concern through one structure can create a tax problem in another, which is why operational intent is part of the initial planning conversation at Allegis Law.
Strategy and Transaction Review
We start with a focused consultation. We review your intended use of the aircraft, existing entities, tax profile, and long-term objectives. From there, we identify risks and planning opportunities before work begins.
Ownership Structure and Tax Design
We design a customized aircraft ownership structure that satisfies FAA eligibility rules and supports defensible tax treatment. Operating agreements and internal documentation are drafted to reflect documented business use and defined management authority. Where appropriate, we coordinate with your CPA to confirm reporting consistency.
Implementation and Ongoing Counsel
We finalize entity formation and assist with registration documentation. After closing, we remain available through our ongoing general counsel services to adjust structure as laws, business operations, or ownership change. When operational plans shift, including a transition from personal use to charter revenue, the ownership structure may require adjustment to remain compliant with FAA rules and to preserve the tax treatment the original structure was designed to support.
An aircraft can expand your business reach and personal flexibility. It can also create unnecessary exposure if structured improperly.
Allegis Law provides legal services for airplane ownership nationwide, built around entity design, tax strategy, and asset protection as one coordinated plan.
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