If you have purchased equipment recently, or plan to in the future, you should check out this update. RightChoice Equipment Leasing is committed to researching and communicating equipment financing information that will benefit our present and future clients. Let us know if we can be of service and in the meantime, please enjoy this article.

WITHOUT A DOUBT IT IS THE RIGHTCHOICE...Did you know 80% of businesses lease equipment.

More than 30% of a businesses assets are acquired through leasing.

More companies acquire equipment through leases than through loans.

WHY?????

First, what actually is a lease?
It is an agreement between a lessee, who pays the equipment owner, the lessor, to use the equipment for a specific amount of time.
Secondly, loans have rates--a lease has rental payments made to a lessor for the use of the equipment/asset. Companies benefit from the use of the equipment, not the ownership.

UTILIZE ASSET BASED FINANCING...
Most companies utilize leasing, because they find it to be more cost effective than using cash flow, or other financing methods.

HOLD ON TO YOUR CASH...YOU WILL NEED IT...
You only pay for the use of the asset, not for the ownership. It's important, not to tie up capital in highly depreciating assets. You need your cash to support working capital requirements to fuel growth, or maintain liquidity for seasonal, cyclical, or investment needs.

FINANCIAL REPORTING PROFILE...

LEASE VS. BANK LOAN

Lease: No Blanket liens on business. Bank: Requires blanket liens on
company as well as personal
property.
Lease: Low up front cost- keep Working
Capital in the business. Bank: Usually require 20% down.

Every small, medium and large American business is waiting to see what the "lame duck" congress will be doing about extending the Bush tax cuts, and in particular the AMT which is of concern, because of its potential for double taxation.

*** Important Update for Autumn / Winter 2010 ***

Effective as of 09/28/2010, H.R. 5297 (the Small Business Jobs and Credit Act of 2010) had a substantial (and welcome) impact on Section 179. The biggest impact is that it increased Section 179's limits (almost doubling them).

This should mean a substantial boost to your bottom line this year. But to get the deduction for tax year 2010, you have to act now, as once the clock strikes midnight on 12/31/2010, Section 179 can't affect your 2010 profits anymore.

Leasing and Section 179