Purchasing new equipment is an important decision, and finding financing that fits your business needs is equally essential. Lease financing provides you the ability to buy the equipment you need today with a monthly payment schedule that fits your business needs. Here are five top reasons to choose leasing:

1. Protect against obsolescence

Leasing provides you the option to add-on or upgrade to newer equipment to ensure you’re always operating with the most up-to-date technology.

2. Take advantage of tax benefits*

You may be able to deduct lease payments from your corporate income because the IRS generally does not consider an operating lease to be a purchase. It is considered a tax deductible overhead expense, and they are generally treated as 100% tax deductible paid from pre-tax earnings rather than after-tax profits.

3. Manage your balance sheet

Since an operating lease is generally not considered a long-term debt or liability, it does not appear as debt on your financial statement. This makes you more attractive to traditional lenders when you need them, and it preserves your bank line of credit so you’re prepared for any emergencies or unexpected demands for cash.

4. Conserve capital

Leasing conserves your working capital by requiring only a minimum initial outlay of cash, usually just the first and the last payment. Working capital can be utilized for more productive operational uses and business opportunities.

5. Improve cash forecasting

When you lease equipment, you know the amount and number of lease payments there will be over the life of the lease. This enables you to forecast cash requirements for the equipment, and protect against inflation or stock market volatility.

*Any discussion of tax or accounting matters herein (including any attachments) should not and may not be relied on by any recipient or reader.  The recipient/reader should consult his/her tax adviser and/or accountant for a statement of tax and accounting rules applicable to his/her particular situation and for all other tax and accounting advice.