diff --git a/tmt/bug-soft-reboot.md b/tmt/bug-soft-reboot.md
new file mode 100644
index 00000000..eaef1df3
--- /dev/null
+++ b/tmt/bug-soft-reboot.md
@@ -0,0 +1,35 @@
+# TMT soft-reboot limitation
+
+TMT does not currently support systemd soft-reboots. It detects reboots by checking
+if the `/proc/stat` btime (boot time) field changes, which does not happen during
+a systemd soft-reboot.
+
+See: <https://github.com/teemtee/tmt/issues/3143>
+
+Note: This same issue affects Testing Farm as documented in `plans/integration.fmf`
+where `test-27-custom-selinux-policy` is disabled for Packit (AWS) testing.
+
+## Impact on bootc testing
+
+This means that when testing `bootc switch --soft-reboot=auto` or `bootc upgrade --soft-reboot=auto`:
+
+1. The bootc commands will correctly prepare for a soft-reboot (staging the deployment in `/run/nextroot`)
+2. However, TMT cannot detect or properly handle the soft-reboot
+3. Tests must explicitly reset the soft-reboot preparation before calling `tmt-reboot`
+
+## Workaround
+
+After calling bootc with `--soft-reboot=auto`, use:
+
+```nushell
+ostree admin prepare-soft-reboot --reset
+tmt-reboot
+```
+
+This forces a full reboot instead of a soft-reboot, which TMT can properly detect.
+
+## Testing environments
+
+- **testcloud**: Accidentally worked because libvirt forced a full VM power cycle, overriding systemd's soft-reboot attempt
+- **bcvk**: Exposes the real issue because it allows actual systemd soft-reboots
+- **Production (AWS, bare metal, etc.)**: Not affected - TMT is purely a testing framework; soft-reboots work correctly in production
diff --git a/tmt/plans/integration.fmf b/tmt/plans/integration.fmf
index bca4bbe4..fe74cc73 100644
--- a/tmt/plans/integration.fmf
+++ b/tmt/plans/integration.fmf
@@ -104,7 +104,7 @@ execute:
   adjust:
     - when: running_env != image_mode
       enabled: false
-      because: tmt-reboot does not work with systemd reboot in testing farm environment
+      because: tmt-reboot does not work with systemd reboot in testing farm environment (see bug-soft-reboot.md)
 
 /test-28-factory-reset:
   summary: Factory reset
diff --git a/tmt/tests/booted/test-custom-selinux-policy.nu b/tmt/tests/booted/test-custom-selinux-policy.nu
index 75c786c3..b484a129 100644
--- a/tmt/tests/booted/test-custom-selinux-policy.nu
+++ b/tmt/tests/booted/test-custom-selinux-policy.nu
@@ -22,10 +22,11 @@ RUN mkdir /opt123; echo \"/opt123 /opt\" >> /etc/selinux/targeted/contexts/files
     # Build it
     podman build -t localhost/bootc-derived .
 
-    bootc switch --soft-reboot=auto --transport containers-storage localhost/bootc-derived
+    bootc switch --transport containers-storage localhost/bootc-derived
 
     assert (not ("/opt123" | path exists))
 
+    # See ../bug-soft-reboot.md - TMT cannot handle systemd soft-reboots
     # https://tmt.readthedocs.io/en/stable/stories/features.html#reboot-during-test
     tmt-reboot
 }
diff --git a/tmt/tests/booted/test-soft-reboot.nu b/tmt/tests/booted/test-soft-reboot.nu
index ee372149..e131dd71 100644
--- a/tmt/tests/booted/test-soft-reboot.nu
+++ b/tmt/tests/booted/test-soft-reboot.nu
@@ -36,7 +36,7 @@ RUN echo test content > /usr/share/testfile-for-soft-reboot.txt
 
     assert ("/run/nextroot" | path exists)
 
-    #Let's reset the soft-reboot as we still can't correctly soft-reboot with tmt
+    # See ../bug-soft-reboot.md - TMT cannot handle systemd soft-reboots
     ostree admin prepare-soft-reboot --reset
     # https://tmt.readthedocs.io/en/stable/stories/features.html#reboot-during-test
     tmt-reboot
@@ -45,9 +45,7 @@ RUN echo test content > /usr/share/testfile-for-soft-reboot.txt
 # The second boot; verify we're in the derived image
 def second_boot [] {
     assert ("/usr/share/testfile-for-soft-reboot.txt" | path exists)
-    #tmt-reboot seems not to be using systemd soft-reboot 
-    # and tmt-reboot -c "systemctl soft-reboot" is not connecting back
-    # let's comment this check.
+    # See ../bug-soft-reboot.md - we can't verify SoftRebootsCount due to TMT limitation
     #assert equal (systemctl show -P SoftRebootsCount) "1"
 
     # A new derived with new kargs which should stop the soft reboot.