Leasing and Taxes: What to Understand
Before you lease or buy that next copier, you must understand the tax implications. Under tax code, leases have been classified as a business expense, but a purchase is treated as capital outlay. If you choose to buy, 40 percent of the copier’s purchase price can be deducted in the first year. Until you have repaid the loan, you can deduct 25 percent of the total each year. Each state may differ, so please check with your accountant to be sure.After you have paid the loan, the copier will belong to you. Leasing a copier does cost more over time, but many companies choose to lease because the expense is 100 percent deductible. If you choose to lease, your company’s tax liability could be lower than if you purchased it outright. Nevertheless, you should speak with a tax professional to help you evaluate the special circumstances of your company.
When the lease ends, you can choose to renew the agreement or to return the machine. Whether you decide to lease or purchase a copier, we have the expertise to make recommendations that will fit your budget and administrative tasks. Looking for a competitive quote on leasing? For further information, contact our company, and we can help you to receive the most value at the best price.