Why Lease Equipment?

Leasing is a great solution for all of your business equipment needs, and on all types of day spa and physical therapy equipment, as well as tanning systems etc. Whether you are a sole proprietorship, part of a partnership, leasing equipment is a very intelligent choice. Leasing provides your company with the quality equipment you require to successfully operate your business, coupled with the flexibility of monthly payments. Your business can realize significant tax savings by leasing equipment, since monthly payments on leases are typically viewed as operating expenses. Consult with your financial advisor to determine the most tax-beneficial lease for your company. Is It Easy to Lease? LeaseProcess is committed to leasing the equipment you need without the hassle. Our one-page application can get you approved fast for all of your equipment leasing needs.

HOW TO START?

Contact Goodspa for an invoice total on your desired equipment, products and shipping. We will put you in touch with our leasing agency and you can apply through the link below.

~ See the Easy Application Sample by clicking here ~

Types of Leases

Choose the right lease.

Many companies lease or finance equipment without considering the differences in expense deduction methods between a true lease or loan. It's only after year-end when tax time arrives that they find out the type of lease or financing they chose did not maximize their possible deductions for that and future years.

The end of lease residual or purchase option is the primary factor that determines the tax handling of your lease. Every for-profit company in the U.S. has an amount of capital equipment they can purchase each year that can be fully expensed under I.R.S. Section 179. If your company has not exceeded the annual limit, then a finance lease with a $1.00 residual may be the choice for you.

On the other hand, if you have met your maximum capital purchase deduction for the year or regularly do so, you may want to choose a true lease with a fair market value residual or purchase option not less than 10% of the original equipment price.

Since the total monthly payments of a true lease are normally expensed each year, you may be able to accelerate your equipment depreciation if the lease term is less than the term required to depreciate the asset under it's classification. You will also save in the accounting costs associated with creating and managing depreciation schedules.

Another important factor in choosing your lease is weighing the benefits versus disadvantages between longer and shorter terms.

Longer terms can provide for lower monthly payments and increased annual cash flow for revenue producing assets. The main disadvantage to longer lease terms is the higher balance you will have to pay off if you want to trade out of the equipment or buy-out the lease early for any other reason. If the equipment you are getting does not retain it's value, depreciates in value quickly, or regularly becomes obsolete, it may be wise to choose a shorter term.

The two primary benefits to a fair market value lease, which may or may not qualify as an operating lease (off balance sheet financing), are that you may be offered below market rates and you have the power to negotiate the end of lease purchase price. Best of all, you can use the equipment at a low rate, just turn it back to the leasing company at the end, and lease new state of the art equipment with up-to-date technology.

If you are acquiring equipment that you are planning to keep for longer than the lease term and it has high value retention, you may not want to utilize this type of lease.

Disclaimer: This information is provided for your review and should be discussed with a qualified accountant. We are not a business consulting or financial accounting firm and shall not be liable for any choices you make based on the information provided herein.