Why Lease?
1. Conservation of capital: Leasing provides the vital equipment you need
today at a fixed monthly rate. In some instances leasing can be an expensed item on
the operating budget, leaving the capital budget intact for more productive uses that will
produce a Return on Investment.
2. Preserve borrowing capacity: Companies
and Professionals utilizing their short term credit lines to acquire equipment will in
essence be stealing from their future growth. Credit lines are an invaluable asset
for meeting seasonal borrowing requirements or to take advantage of unforseen business
opportunities. A company that has committed the bulk of its line to equipment
purchases might lack the financial flexibility it needs if called upon.
3. 100% Financing: Leasing offers
100% financing without any downpayments, trade-ins or gimmicks.
4. Off balance sheet financing: Lease expenses if structured
and documented correctly do not necessarily have to show on the balance sheet as a
liability.
5. Tax Advantages: The Wall Street Journal recently printed that
"Leasing" offers one of the only loopholes left open in the new "Tax Reform
Package". For example, if properly documented a piece of equipment that
purchased outright must, according to new depreciation schedules be depreciated over 5-7
years can instead be expensed in anywhere from 2-5 years, thus providing a much faster
write-off period and more of a Tax Shelter for your hard earned profits.
Furthermore, accelerated depreciation is an Alternative Minimum Tax preference item
(A.M.T.) and operating expenses are not. (Please consult your accountant or
financial professionals for further details.)
6. Overcomes obsolescense: The lessee has the ability to return the
equipment at the end of the lease term and can contine to lease state of the art
equipment.
7. Leasing offers: Creative flexibility with regards to term, payment
amount, purchase options, etc...
8. Leasing is: Less expensive than outright purchase of equipment when the
loss of return on your hard earned Investment Capital is factored in. Use other
peoples money to acquire the use of depreciating assets
and use your money to buy and own appreciating assets.
By following this simple time honored rule you will always be receiving a maximum
return on your capital. |