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IRELAND – A LESSOR'S DREAM
01 December 2005
The American Jobs Creation Act of 2004 created about 450 amendments to the Internal Revenue Code, but one change in particular has potentially far-reaching consequences for US aircraft lessors. Garry Burke, chief executive officer of Pembroke Capital, reports.
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aircraft leasing
Aviation
Airlines
airline
operating lease
How often does an opportunity arise to create a permanent deferral of US taxes? How would you feel about reducing your taxes on ongoing income by almost two-thirds? Add these opportunities to the possibility of writing back most of your deferred tax provision and you can see how powerful the application of the American Jobs Creation Act of 2004 can be for US lessors.
Explaining the Act
The World Trade Organization ruled in 2000 that the US extra territorial income regime (remember the FSC) represented an illegal subsidy to US exporters. There was little impetus for change until the EU began to impose duties on imports from the US. Initially, the 2004 American Jobs Creation Act was designed as a response to this ruling (and the EU levies) to create a new deduction for manufacturers. But what began as a bill to compensate exporters transformed into a 900-plus section, 450-plus amendment...
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