Ken's Project Blog

July 19, 2011

Warren Buffett on Private Jet Deductions

Filed under: In The News,Politics,Taxation — Ken @ 5:28 pm

In this clip from CNBC, Warren Buffett, CEO of Berkshire Hathaway, discusses the source of the much-vilified “deductions for corporate jets” and explains his three situations regarding the deductiblity of his fractional jet ownership: he has a fraction of a jet for purely personal use, no deduction (not a business expense); his corporation has a fractional jet for purely business use, that is 100% deductible for 2011; and he has bought a fractional jet for use by his three children, for which he pays a very significant gift tax on (approaching 50%, as I understand it).

So where did this 100% deduction for corporate jets come from? The New York Times explained it pretty well back in September of 2010:

Stimulus measures enacted at the end of the Bush administration and continued in 2009 allowed businesses to depreciate 50 percent of qualified investments. A separate administration proposal to benefit small businesses with tax cuts and loans, which has been pending in Congress much of the year and remains blocked by Republicans in the Senate, would extend this smaller tax break through 2010.

Mr. Obama would expand this to 100 percent through 2011 and make it effective retroactive to this Wednesday, regardless of when Congress might approve the proposal. [emphasis added]

Source: nytimes.com

Did you notice that the “special deduction for corporate jets”, and almost every other capital investment expires at the end of 2011?

The most telling part of the discussion, after describing what is and is not deductible with regard to corporate jets, is this line at the end of the clip:

Buffett: “I don’t really see where a business aircraft is different than a business locomotive.”

I think Mr. Buffett is failing to take into account the class warfare aspect of this issue – and did

Sources:

YouTube.com: Warren Buffett disagrees with Obama’s rhetoric about jets

mrctv.org: Warren Buffett Not a Fan of Obama’s Corporate Jet Rhetoric

nytimes.com: Obama to Propose Tax Write-Off for Business

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2 Comments »

  1. […] exactly are those special tax breaks that oil companies and corporate jet owners get? As Warren Buffett pointed out earlier this week, only corporate jets that are used for business purposes are deductible, same as […]

    Pingback by President Obama’s Op-Ed in USA Today « Ken's Project Blog — July 22, 2011 @ 12:11 pm | Reply

  2. .Another view of SSA headquarters…The Social Security Administration SSA is an of the United States that administers a program consisting of disability and survivors benefits. To qualify for these benefits most American workers pay Social Security taxes on their earnings future benefits are based on the employees contributions..The Social Security Administration was established by a law currently codified at .

    Comment by hemp — August 15, 2011 @ 7:48 am | Reply


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