The ‘One Big Beautiful’ Tax Bill’s Effects on the Agricultural Aviation Industry

On July 4, 2025, President Trump signed H.R. 1—dubbed the One Big Beautiful Bill Act (OBBBA)—enacting significant modifications to the United States tax code ranging from increasing bonus depreciation amounts to scaling back clean‑energy credits—both of which affect the agricultural aviation industry. One provision that might benefit aerial application businesses is an increase in the state and local taxes, or SALT deduction. Starting this year through tax year 2029 individuals earning less than $500,000 will be able to deduct $40,000 of SALT increasing 1% annually through 2029, then reverts to $10,000. Owners of pass-through businesses like S corporations and partnerships, whose business income passes through to their individual returns, will still be able to use workarounds available to effectively get unlimited SALT deductions. A business owner who has $1 million in business income and pays $60,000 in state income taxes could deduct that full amount, for a tax savings of about $22,000.

H.R. 1 also alters clean‑energy tax incentives for solar and wind power under the Inflation Reduction Act of 2022 (IRA). Currently, a production tax credit of 0.3 ¢ per kWh exists for electricity generated by zero‑emitting facilities for ten years after they’re placed in service. Under H.R. 1, wind and solar projects must be placed in service by December 31, 2027 to claim this credit. Wind and solar projects starting on January 1, 2025, until July 4, 2025 (i.e., the date of enactment) will also receive credits at the full rate.

Regarding the estate and gift tax, the bill institutes a permanent (and inflation-adjusted) exemption level of $15 million beginning in 2026 for single filers and $30 million for joint filers.

The bill also provides a permanently higher threshold for expensing certain equipment for smaller businesses (Section 179 expensing). In other words, bonus depreciation is back to 100%, but only for assets placed in service in 2025 through 2030. H.R. 1 expands the expensing cap to $2.5 million under Section 179 with phaseout beginning at $4 million and permanently restores 100% bonus depreciation for short-lived assets, including immediate expensing for domestic R&D; retroactive to 2021 for small businesses.

Be sure to contact your accountant for exact details on the changes in tax law as a result of H.R. 1 OBBA.