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Tax Benefits of Leasing
EverGreen offers the ability to write both finance/capital leases and true tax leases. Simply inquire about the benefits with one of our representatives.
Benefits by Lease Type
Finance Lease:
The benefit of this lease type is that you can take advantage of IRS Section 179 and expense up to the amount allowed for the year the equipment is installed. You may depreciate any excess on the depreciation schedule for that particular asset. Typically, a finance lease is a full pay out, non-cancelable agreement. You are responsible for maintenance, taxes and insurance.
Example of Tax Benefit: The equipment is installed this year and the cost is $100,000. Using IRS Section 179 and using a 33% tax bracket, your tax savings by leasing, versus buying, would be $100,000 x .33 = $33,000, plus the depreciation value on the remainder of $67,000.
Tax Lease/True Lease:
The benefit of a True Lease is that the lessee may be allowed to claim the entire amount of the monthly investment as a tax deduction. Many lease rental contracts qualify as a true lease. A tax lease or true lease is one in which the lessor retains ownership.
Example of Tax Benefit: Monthly investment/payment is $10,000. Term is 36 months. Assuming a 33% tax bracket, your monthly tax savings would be $10,000 x .33 = $3300. The total tax savings over the term of the contract would be $118,800.
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