The One Big Beautiful Bill Act of 2025: What It Means For Yacht Buyers And Why Now Is The Time To Act

Understanding the One Big Beautiful Bill Act of 2025

Enacted for vessels purchased between January 20, 2025, and December 21, 2029, OBBBA provides generous bonus depreciation to U.S. taxpayers who purchase yachts and use them primarily for business, specifically, for active third-party charter operations in U.S. waters.

Key qualifications include:

• The yacht must be used more than 50% for charter (business) vs. personal use.
   
• The vessel must spend over 50% of its time in U.S. waters.
   
• Owners must maintain thorough, contemporaneous documentation, including charter contracts, advertising, expense records, and passenger logs.

• Both new and used yachts placed into business service after January 20, 2025, are eligible for the deduction, provided they haven’t been previously used by the taxpayer.  As IYC Sales Consultant, Mark Elliott notes, “a lot of people don’t realize that any yacht that can do charters can qualify.  If foreign-flagged, from the time of purchase, the yacht has to remain in US territorial waters ( including Puerto Rico and the US Virgin Islands) for 51% of the time before Jan 1st and do at least one paying charter.  If US-flagged, the yacht can be located anywhere.”

   

• If used 100% for business, 100% of the yacht’s purchase price may be depreciated in the first year.
   
• If personal use occurs, the depreciation deduction is proportional to the business-use percentage.
   

As IYC Sales Consultant Kerry Iler notes, “the yacht needs to be a ‘business entity’ for the owner and held/utilized as such. It needs to spend the majority of its time chartering and being used as a business, so it makes sense for the depreciation and US tax benefits.”

However, if the vessel’s business use falls below 50% after the first year, tax recapture applies, meaning the deduction must be paid back and converted to standard depreciation. Proper operation, compliance with U.S. maritime law, and a documented track record of charter activity are therefore vital.

Why Now Is The Time To Buy

If you are a U.S. taxpayer considering yacht ownership, the 2025–2029 window offered by OBBBA is not just an opportunity; it’s a strategic advantage. Here's why:

1. Immediate Financial Incentive

You can write off up to 100% of the yacht's purchase price via bonus depreciation in year one. This represents an unprecedented advantage that dramatically offsets the cost of acquisition.

2. Build a Revenue-Generating Asset

Unlike personal-use-only vessels, a charter yacht creates revenue and builds equity while you're enjoying your time onboard. In a thriving U.S. charter market, this can yield strong annual returns.

3. The U.S. Charter Market Is Competitive—and Lucrative

From the Hamptons to the Florida Keys, the demand for charter yachts in U.S. waters continues to rise. With IYC’s established footprint across Fort Lauderdale, Palm Beach, Newport, Nantucket, and San Diego, you gain immediate access to one of the most dynamic charter markets in the world.

“The buyer must be a U.S. taxpayer in order to utilize the write-off. The vessel must stay in American waters for 51% of the time, and usage must be at or over 51% for business use. Actively advertising the vessel for charter and being able to demonstrate that to the IRS is necessary.” — IYC Sales Consultant, Kerry Iler

How Charter Management Supports Your Business

Turning your yacht into a successful charter business and staying fully compliant with OBBBA requires more than a simple listing. It requires expert oversight, meticulous documentation, and continuous marketing. That’s where IYC Charter Management comes in.

“While our guidance during the acquisition is an integral part of the process, it's crucial to remember that you are starting a business… That’s why our services are comprehensive; we support our clients from start to finish.” — IYC California Managing Partner, Matthew Stone

Demonstrating Your Vessel As A Charter Business

As a central charter agency, IYC provides everything necessary to present and manage your yacht as a serious, professionally run business:

• Yachtfolio Listings (the #1 charter database worldwide)
   
• Global charter fleet of over 160 superyachts
   
• Full charter documentation, including:
   
  • Charter agreements
     
  • Broker correspondence
     
  • Manifests and itineraries
     
  • Per-charter revenue and expense tracking
     
• Dedicated charter managers, working with your captain, legal, and tax advisors
   
• Custom accounting for real-time tracking of revenue and costs
   
• Regional charter show participation to increase visibility
   
• Access to vetted photographers and videographers
   
• Coordinated U.S. and global marketing campaigns from a 10-person marketing team
   

Peace of Mind with Full Yacht Management

Beyond charter bookings, IYC’s Yacht Management Division provides ongoing support to protect your investment and reduce operational stress.

Our services include:

• Budgeting and financial oversight
   
• Crew placement and payroll
   
• Safety and compliance monitoring
   
• Maintenance planning
   
• Coordination with flag states and classification societies
   

With our global infrastructure, 24/7 support network, and proprietary tools, every detail is accounted for, ensuring your yacht runs efficiently, remains compliant, and generates consistent charter income.

Next Steps: Building Your Charter Business

The One Big Beautiful Bill Act is a rare and time-sensitive opportunity that turns yacht ownership into a viable, strategic business investment. With the right team, structure, and strategy, your yacht can provide both financial benefits and unforgettable experiences.

No matter where you’re at with your yachting journey, IYC serves as a long-term partner in ownership.

Ready to get started? Get in touch to discuss your next yacht and how we can help you leverage the OBBBA to its fullest. Contact our experts for a personalized assessment of how the OBBBA can benefit your yacht investment strategy in conjunction with the advice from your professional CPA or tax and legal advisors.