Podcast Summary: Tax Smart Real Estate Investors Podcast

Episode 365: Can You Really Write Off a Private Jet? What Actually Works with Preston Holland
Release Date: February 16, 2026
Host: Hall CPA (Thomas, Nate, and team)
Guest: Preston Holland, President & Founder of Prestige Aircraft Finance

Episode Overview

This episode dives deep into the allure—and reality—of writing off private jets as a tax strategy for real estate investors and entrepreneurs. Featuring aviation finance expert Preston Holland, the conversation candidly reveals who actually benefits from private jet ownership, how financing structures work, what the IRS is looking for when you try to “write off” your airplane, and why fractional ownership or chartering may often make more sense. The hosts and Preston bust common myths, highlight critical tax pitfalls, and share real-life stories from the high-flying world of private aviation.

Key Discussion Points & Insights

Preston Holland’s Background & Entry to Aviation Finance

• Preston’s aviation interest was sparked by his pilot father and a background in real estate (large REMAX franchise, “We Buy Ugly Houses,” various FL businesses).
• Began in aviation operations, then finance, founding Prestige Aircraft Finance—$150M in aircraft deals closed in the past year.
• Likes to post industry insights on X/Twitter (@PrivateJetGuy).

  “I got called at a party one time by a guy…he goes, yeah, you guys got to follow this private Jekyll on Twitter. And I was standing next to him, and I was like, oh hey, that's me.” (04:03)

Types of Private Jet Access

[04:40–07:34]

1. Charter (Part 135):

   • Call for one-off trips (Uber for jets).
   • Most expensive per hour, but no commitment.
   • Subject to 7.5% federal excise tax within the US.

2. Jet Card/Membership:

   • Prepaid hours at set rates, still uses Part 135 charters.
   • Predictable, pays 7.5% tax, less commitment than ownership.

3. Fractional Ownership:

   • Own a share (e.g., NetJets - “quarter share”), guarantees annual hours/fleet access.
   • “Picasso is like NetJets of houses.” (08:21)
   • No 7.5% excise tax, but other taxes possible.

4. Whole Aircraft Ownership:

   • Own outright (solo or with partners).
   • Avoids excise tax, but exposes owner to a vast web of other taxes and regulations.
   • Most clients are high-net-worth business owners using jets as business tools, not toys.

5. “Friend with a Jet:”

   • “Best way to fly private…you don’t have to pay for it.” (04:40)

The Role of an Aircraft Finance Broker

[09:38–13:40]

• Brokers step in when traditional or brand-name banks can’t/won’t finance planes (outside their box, not new, not $50M+).
• Preston’s firm manages relationships across 50+ lenders, builds bespoke financing structures, mediates between lenders, clients, and their professional teams.
• Aircraft deals nearly always require personal guarantees.

  “It's the MEZ layer that usually gets you in trouble from a real estate debt stack standpoint; where in aircraft it's first lien priority.” (12:25)

Who Should (Actually) Buy a Jet?

[13:56–16:43]

• Typical Owner:
  • $10M/year personal income (pre-tax planning)
  • $100M+ net worth (including operating companies w/realistic multiples)
  • Substantial business travel needs—51%+ bona fide business use needed for key tax benefits
• “There are levels in life…You do not have to be Elon Musk and you do not have to buy a G650 to fly private. There are a lot of different levels.” (14:14)
• Commonly, usage is a business necessity (site visits, client meetings), not a luxury.

Jet Write-Offs, Tax Loopholes & IRS Scrutiny

[17:10–27:35]

1. 100% Bonus Depreciation:

   • Used to allow full write-off in year one (if >51% business use).
   • Most clients structure for maximum year-one deduction, but must maintain business use in subsequent years to avoid recapture.

   “If you do the math, it's effectively a $0 transaction. And so you're just flying at operating cost and like your direct cost for the next, call it five years. Problem is recapture. Right? And no one wants to talk about recapture when they're talking about sexy business strategies.” (18:02)

2. Business Use Thresholds:

   • 51%+ business use is required for favorable tax treatment (for both bonus depreciation and ongoing expenses).
   • Personal use (family trips to Cabo, etc.) must be limited/documented.

3. IRS Audits:

   • The IRS has a new focus—a specific check-box for jet ownership (Form 4562).
   • 300+ pages of required documentation for deductions to stand up in audit.

   “...the IRS is always making ROI plays and they think they can win big time on the jet use.” (24:34)

Avoiding the Most Common Tax Pitfalls

[27:35–35:44]

1. Specialized Aviation Tax Consulting is a Must:

   • “If you're going to take this strategy…hire a specialist. Aviationtaxconsultants.com is one…I am friends with a couple of the principals there…They create all of the structure the IRS is looking for.” (25:39)

2. Fractional Ownership Clarified:

   • No federal excise tax on ownership shares, can still take depreciation on your share used for business.

3. Myths Debunked: Passive vs. Active Participation:

   • Leasing your jet (to flight schools, charters): almost always passive—cannot offset “active” income unless you’re truly materially participating.
   • “If you're buying a triple net lease Charterbird for $10 million, you've got passive tax problems. …it's these guys who own a business…and I'm like, I hate paying taxes so I'm going to do this questionably weird. …Those are the guys, I think, that get in trouble.” (32:12)

4. Real Estate Professional Status Does Not Help with Jets:

   • “Unfortunately the real estate professional status does not help when you're leasing aircraft. An aircraft is not real property. It's not real estate.” (35:03)

Economic Realities: Cost, Usage, and Sensible Alternatives

[36:10–39:20]

• Under 75 flying hours/year? You’re almost always better off chartering or fractional than owning.

  “If you take all your costs divided by 75, you're going to come out better chartering. … Even if you're like, oh, this is a great tax play, you're still losing because you're not using it enough.” (36:50)

• Even billionaires often prefer fractional for less hassle.

• “It's not just the money, it's the pain in the arse factor—he said, I want to call, show up, fly, pay my bill. Like that's all I want to do.” (39:20)

Rapid Fire & Memorable Moments

Best Jet for Beginners?

• Citation XLS/Excel or Citation Jet (CJ1, CJ2) for small teams/families.
• PC12 and King Air: turbo-props, cost-effective for “starter” private aviation. (41:21)

Wildest Deal?

• Closing a jet deal with a hotel owner—almost had to fly internationally just to get loan docs signed because client was “on the beach.” (41:55)

What Buyers Should Know Before Calling Preston:

• “It’s a lot more like buying a business than like buying a car…It's going to be a cavity check.” (43:17)

Unforgettable Quotes

• “You can quit crack cocaine. You can’t quit private aviation.” (19:12)
• “It is the only way in which you can buy your time back. And that I think is priceless.” (19:22)
• “It is not as simple as a quick…TikTok video on writing off a private jet. You need to be well-capitalized…have the ability to make a case to have the business use.” (36:10)
• “You have to work as hard as you possibly can until you can fly private…because it is the only thing that will change your life. …It's not just champagne and caviar.” (44:24)

Practical Takeaways

• Don’t buy a jet for the tax write-off alone: Only makes sense for truly high-usage, high-net-worth entrepreneurs with genuine business needs.
• Flying charter or fractional? Still plenty of write-offs and flexibility—often smarter and easier, especially for <150 hours/year.
• Engage specialized tax advisors: Compliance and documentation are everything. Failing on this will cost far more than you “save.”
• Partnership pitfalls: Partnerships complicate usage calculations and documentation—plan thoroughly and track everything.
• Depreciation ≠ Asset Value: Jets lose market value fast—don't expect to profit on resale.

Resources & Where to Find More

• Preston Holland: prestigefinance.com | prestonholland.com
• Newsletter: Private Jet Insider
• Specialized Aviation Tax Advisor: aviationtaxconsultants.com

Final Words

Private jets offer immense convenience and efficiency to top entrepreneurs and real estate moguls—but the financial, operational, and compliance stakes are sky-high. The “private jet write-off” story is nuanced: viable only for those with substantial business needs, airtight documentation, and the stomach for complexity. For most, charter or fractional programs will yield the luxury without the headache. Always call in a specialist before making moves—the IRS is watching now more than ever.