How to Buy a Private Jet in the USA: A Complete Buyer’s Guide
The United States is the world’s largest private aviation market by fleet size and transaction volume. The regulatory framework is well-established, financing options are extensive, and the supply of pre-owned aircraft is broader than in any other country. However, the US system has its own specific requirements — FAA registration, state-by-state sales tax variations, complex tax planning opportunities, and a structured escrow and pre-buy process — that buyers must understand before committing to a purchase.
This guide covers the complete process of buying a private jet in the USA, from initial specification through to FAA registration, tax planning, and operational setup. For available aircraft on the US market, see our private jets for sale in the USA. For general acquisition principles, the buyer’s guide to purchasing an aircraft provides a useful foundation. Our aircraft sales broker services cover the full US market.
Step-by-Step: The US Private Jet Buying Process
Step 1: Establish Your Mission and Budget
Define your primary routes, passenger requirements, range, and runway access. The US domestic market accommodates a wide range of aircraft categories, from turboprops and light jets suited to shorter routes and unimproved strips, through to ultra-long-range large-cabin aircraft for coast-to-coast and transatlantic operations. Budget should encompass not only acquisition cost but also pre-buy inspection costs, import costs (if applicable), initial maintenance, and first-year operating costs.
Step 2: Engage a Buyer’s Representative or Broker
A qualified aircraft broker with US market experience will source appropriate aircraft from FAA-registered inventory, the international market, and off-market sources. In the US, brokers are not licensed in the way that real estate agents are — there is no federal licensing requirement — which makes professional credentials, references, and track record all the more important to verify. Clarify upfront whether the broker represents the buyer exclusively or holds a dual agency arrangement.
Step 3: Letter of Intent and Deposit
A Letter of Intent (LOI) is submitted to the seller, outlining the proposed purchase price, pre-buy inspection scope and location, deposit amount, and exclusivity period. In the US, deposits are typically held in escrow by an independent aviation escrow company — Aircraft Closing Services, AVEMCO, and similar dedicated aviation escrow providers are commonly used. The deposit is fully refundable if the pre-buy inspection reveals material defects that cannot be resolved.
Step 4: Title Search
Before the pre-buy inspection begins, a title search should be conducted. In the US, this involves searching the FAA Aircraft Registry in Oklahoma City and the International Registry (Cape Town Convention). The title search will reveal any recorded liens, mortgages, or security interests against the airframe and engines. AOPA, aviation title companies, and specialist aviation law firms conduct these searches. A clean title report is a prerequisite to proceeding.
Step 5: Pre-Buy Inspection
The pre-buy inspection is the most critical stage of a US aircraft transaction. It must be conducted by an FAA-certificated repair station (Part-145 certified) or an FAA-authorised Inspection Authorisation (IA) holder, independent of the seller and the seller’s maintenance provider. The scope of a proper pre-buy includes a full airframe inspection, avionics functional check, engine and APU borescope, logbook and records review, and an operational test flight. Any discrepancies (squawks) found are used as a basis for price adjustment or pre-closing rectification. Do not accept a seller’s own maintenance records as a substitute for an independent inspection.
Step 6: Purchase Agreement and Closing
The Aircraft Purchase Agreement governs the transaction. US aircraft purchase agreements are typically governed by the law of a specific state (often New York or the state where the aircraft is based). The agreement will specify the closing date, the escrow process, conditions precedent, and representations and warranties. At closing, funds are released from escrow to the seller, and title transfers to the buyer simultaneously. The escrow company coordinates the exchange and files the FAA registration documents.
Step 7: FAA Registration and Entry into Service
Immediately after closing, the aircraft is registered with the FAA. AC Form 8050-1 (Aircraft Registration Application) is submitted to the FAA Airmen and Aircraft Registry in Oklahoma City. The FAA issues a Certificate of Aircraft Registration with the aircraft’s N-number. The aircraft can operate under a pink copy of the registration while the formal certificate is processed (typically 3–6 weeks). If the aircraft is to be operated commercially, an FAA Air Operator Certificate (AOC) or Part-135 certificate is required in addition to registration.
FAA Registration and Regulatory Requirements
FAA N-Number Registration
All aircraft based and operated in the United States must be registered with the Federal Aviation Administration and carry an N-number registration mark. The N-number consists of the letter N followed by a combination of up to four digits and one or two letters (e.g., N123AB). N-numbers can be reserved in advance for a fee, allowing buyers to select a preferred combination.
FAA registration eligibility requirements specify that the aircraft must be owned by a US citizen (including US-incorporated companies), a permanent resident alien, or in limited cases by a non-citizen corporation through an FAA-approved trust structure. Non-US buyers wishing to register aircraft on the FAA registry must use a qualifying trust arrangement.
Trust Structures for Non-US Owners
Non-US citizens and foreign companies cannot directly hold FAA registration. However, through a US-based owner trust (typically administered by a bank or trust company in Oklahoma), a foreign owner can achieve FAA registration while holding beneficial ownership. This is a well-established and legally sound structure used extensively in international aircraft transactions. The trustee (a US citizen entity) holds legal title, while the beneficial owner retains all economic rights. TVPX, Banc of America Leasing, and similar aviation trust companies provide this service.
FAA Airworthiness Certificate
A US-registered aircraft must hold a valid FAA Airworthiness Certificate. Standard Airworthiness Certificates are issued for certificated aircraft types and remain valid as long as the aircraft is maintained in accordance with FAA regulations and current airworthiness directives. Buyers of used aircraft should verify that the aircraft’s airworthiness certificate is current and that there are no outstanding airworthiness directives (ADs) requiring compliance.
Tax and Financial Considerations
State Sales Tax — A Critical Variable
Federal law does not impose a sales tax on aircraft purchases. However, US states do — and the variation between states is significant. State sales tax rates on aircraft purchases range from 0% to over 10%, and the rules for which state’s tax applies (based on where the aircraft is delivered, where it is registered, where it is based, or where it is used) are highly state-specific.
Several states impose no sales tax on aircraft at all, including Oregon, Montana, Delaware, and New Hampshire. Others, such as California, impose sales tax at the state rate (currently 7.25%) plus local add-ons, and enforce aggressive use-tax rules that apply to aircraft brought into the state even if purchased elsewhere. Engaging an aviation tax specialist before selecting the delivery state and the registration state is essential — the difference in tax liability between jurisdictions can amount to hundreds of thousands of dollars on a mid-market aircraft transaction.
Federal Bonus Depreciation
One of the most significant financial advantages available to US aircraft buyers is federal bonus depreciation under Section 168(k) of the Internal Revenue Code. When applicable, bonus depreciation allows buyers to deduct a substantial percentage of the aircraft’s purchase price in the year of acquisition, rather than depreciating the asset over its useful life. The specific percentage varies by tax year and is subject to legislative change. At 100% bonus depreciation, a buyer can fully deduct the aircraft’s cost against taxable income in year one. This benefit applies to both new and used aircraft that meet the qualifying criteria.
Qualification requirements include: the aircraft must be used in a qualifying business activity; it must be used by the taxpayer more than 50% for business purposes; and it must meet the placed-in-service requirements. Aircraft used predominantly for personal travel do not qualify. Aviation-specialist CPAs and tax attorneys should advise on structuring the purchase to maximise bonus depreciation eligibility.
Section 1031 Exchange (Like-Kind Exchange)
A Section 1031 exchange allows the seller of a business-use aircraft to defer capital gains tax by rolling the proceeds into the purchase of a replacement aircraft of equal or greater value. The rules are specific: the replacement aircraft must be identified within 45 days of the sale and acquired within 180 days. A qualified intermediary must hold the proceeds during the exchange period — the seller cannot receive the funds directly. 1031 exchanges are a valuable tool for operators upgrading aircraft, but they require careful planning and strict adherence to timelines.
Aircraft Finance in the US
The US has the most developed aircraft finance market in the world. Options available to buyers include:
- Traditional aircraft loans: Offered by banks, credit unions, and specialist aviation lenders (AOPA Finance, Dorr Aviation Credit, Stonebriar Commercial Finance, and others). Loan terms typically range from 5–15 years, with LTV ratios of 75–85% for well-qualified borrowers.
- Dry lease: The aircraft owner leases the aircraft to the operator without crew. Common for US Part-91 and Part-135 operations.
- Operating lease: Monthly payments without ownership, preserving capital and providing fleet flexibility.
- EXIM Bank financing: Available for the purchase of new US-manufactured aircraft (Boeing, Gulfstream, Cessna, Beechcraft). Export-Import Bank financing provides competitive rates for foreign buyers of US aircraft.
- Fractional ownership: Purchase of a share in an aircraft managed by a fractional provider (NetJets, Flexjet, Wheels Up). Not relevant to full ownership but worth understanding as a comparison point.
The Escrow Process
Aircraft escrow is standard practice in US transactions and protects both buyer and seller. An independent escrow company holds the buyer’s deposit and, at closing, the full purchase price. Funds are released simultaneously with the transfer of title documents and FAA registration filings. The escrow company also typically handles lien releases, coordination with the FAA, and confirmation of clear title before releasing funds to the seller. Aviation-specific escrow companies understand the documentation requirements that general financial escrow providers do not.
Where to Base Your Aircraft in the USA
Teterboro Airport, New Jersey (KTEB)
Teterboro is the primary business aviation gateway to the New York metropolitan area and one of the busiest business aviation airports in the world. It is served by multiple FBOs including Signature Flight Support, Jet Aviation, and Atlantic Aviation. Hangar space is in perpetual high demand. Teterboro is 12 miles from Midtown Manhattan and provides efficient access to the New York financial and corporate community.
Van Nuys Airport, California (KVNY)
Van Nuys is the largest general aviation airport in the world by operations and serves as the principal business aviation hub for Los Angeles. It offers extensive FBO facilities, MRO capability, and ready access to the entertainment, media, and technology industries of Southern California. Note that California’s sales and use tax regime requires careful planning for aircraft based in the state.
Miami Executive Airport, Florida (KTMB) / Fort Lauderdale Executive (KFXE)
Florida imposes no state income tax and has historically been an attractive jurisdiction for aircraft ownership. Fort Lauderdale Executive and Miami Executive serve the South Florida business aviation market with good FBO infrastructure and proximity to Latin American routes. Florida does impose sales tax on aircraft purchases, though with an exemption cap that limits maximum liability.
Scottsdale Airport, Arizona (KSDL) / Henderson Executive, Nevada (KHND)
The Southwest offers attractive tax environments. Nevada imposes no sales tax on aircraft, making Henderson Executive and Las Vegas airports popular for aircraft delivery and basing. Arizona and Texas (Dallas Love Field area) also offer strong business aviation infrastructure and no state income tax.
Operating Costs Overview (USD)
US operating costs are broadly lower than equivalent European costs due to lower fuel prices, competitive MRO market, and generally lower airport fees outside the major urban FBOs. The following are indicative annual costs:
- Light jets (Citation CJ3+, Phenom 300E): Annual fixed costs $200,000–$400,000; variable costs $1,800–$3,200 per flight hour.
- Midsize jets (Citation XLS+, Hawker 900XP): Annual fixed costs $350,000–$600,000; variable costs $2,800–$4,500 per flight hour.
- Super-midsize jets (Challenger 350, Citation Longitude): Annual fixed costs $600,000–$950,000; variable costs $4,000–$6,500 per flight hour.
- Large-cabin jets (Gulfstream G650, Global 7500): Annual fixed costs $1,200,000–$2,500,000+; variable costs $6,000–$12,000 per flight hour.
Jet-A fuel in the US is priced in USD per gallon and varies significantly by location and volume. Large-volume purchasers can negotiate fuel programmes through major FBO chains. Costs at metropolitan area FBOs (Teterboro, Van Nuys) are typically 20–40% higher than at secondary market airports.
Frequently Asked Questions: Buying a Private Jet in the USA
Can a non-US citizen register an aircraft on the FAA registry?
Not directly. Non-US citizens must use an FAA-approved owner trust structure, where a qualifying US trustee holds legal title on behalf of the foreign beneficial owner. This is a well-established structure and does not affect operational control or economics. Trust fees are typically $2,000–$5,000 per year.
What is the difference between Part 91 and Part 135 operations?
FAR Part 91 governs private operations — flying for your own purposes without compensation. Part 135 governs commercial charter operations — flying paying passengers for hire. If you intend to offset ownership costs by chartering your aircraft when not in use, you must operate under a Part 135 certificate or place your aircraft with a Part 135 operator. This affects maintenance requirements, crew qualifications, and insurance minimums.
How does bonus depreciation affect my aircraft purchase decision?
Bonus depreciation can dramatically reduce the after-tax cost of aircraft ownership for US taxpayers with business use. The ability to deduct a large portion of the purchase price in year one creates an effective discount on acquisition cost. However, the benefit comes with strings — the aircraft must be used more than 50% for business, and recapture rules apply if the aircraft is sold before the end of its depreciable life. Aviation tax counsel is essential before structuring the purchase.
Do I have to pay sales tax if I buy a jet in Oregon or Montana?
Oregon and Montana impose no state sales tax, and purchasing (taking delivery) in those states can lawfully avoid sales tax at the point of sale. However, if the aircraft is subsequently based or regularly used in a state with sales or use tax, that state may assert a use tax liability. States like California are aggressive in pursuing use tax on aircraft that enter the state regularly. The aircraft’s base of operations and usage pattern determine overall tax exposure.
What is the typical timeline for a US private jet transaction?
A straightforward US transaction from signed LOI to aircraft delivery typically takes 3–6 weeks. This covers title search (2–3 days), pre-buy inspection (3–5 days), legal review and purchase agreement negotiation (1–2 weeks), and closing/FAA filing (1–3 days). Transactions involving complex tax structures, 1031 exchanges, or aircraft requiring maintenance rectification take longer.
Work With a US-Market Aircraft Broker
The US aircraft market rewards buyers who have specialist representation. Aviator Aircraft Sales provides full aircraft brokerage services covering the US market, with access to aircraft listed on AMSTAT, JETNET, and off-market sources. We coordinate pre-buy inspections, escrow, title, and legal requirements on behalf of buyers. Browse our current US private jet listings or the full aircraft inventory. To discuss your requirements, contact our team. You may also find it useful to compare the US market with European aircraft for sale.