Business owners who acquire equipment for their business such as machinery, computers and other tangible goods, usually prefer to deduct the cost in a single tax year rather than a little at a time over a number of years. This deduction is known as Section 179. With recent legislation, the Section 179 deduction is now $1,000,000.00. In addition, The Bonus Depreciation allows businesses to deduct 100% of capital acquisitions above the Section 179 amount up to $2,500,000.00. There is a gradual phase out above this amount.
Benefits of Capital Lease or Finance Agreement
The benefit of a capital lease or finance agreement is that the customer may deduct $1,000,000 in equipment purchases to offset taxable income. The Bonus Depreciation adds further benefit above this amount. Our Lease with the $1.00 purchase option and Equipment Finance Agreement would qualify under Section 179.
Each company should contact their tax advisor to learn about the specific impact to your business.
Contact Ryan Capital Leasing
Interested in learning more? Please feel free to contact your Ryan Capital Leasing representative for lease options, along with a tax savings estimate, on any possible transaction.