UNDERSTAND the benefits of EQUIPMENT leasing
Enjoy all the benefits of ownership with optimum flexibility and the potential to enhance your profits for business growth and success. Leasing allows you to respond quickly to new opportunities with minimal financial difficulty so you can get your Roland DG machine up and running and making you money.
Did you know 80% of all businesses lease and 30% of all assets acquired in the United States is through leasing?
- Up to 100% financing with minimal or no costs upfront
- Financing for media, inks, and training up to 25% over the machine’s purchase price
- Tax and accounting benefits to enhance your profitability
- Flexible payment and end-of-lease options to support your financial goals
- Technology upgrade options to keep your business on the cutting edge
What is a Lease?
A lease is an agreement in which the lessee has the right to use the equipment for a specific period of time. The contract obligates the lessee to make periodic payments to the lessor for the use of the equipment. At the end of the lease term, the lessee may have the option to purchase the equipment based on the purchase option.
Tax Lease versus Non-Tax Lease
For IRS purposes, a lease falls into one of two categories: A non-Tax Lease or a Tax Lease – each has different types of end-of-lease purchase options.
Non-Tax/Capital Lease
The benefit of this lease type is the ability to take advantage of IRC Section 179 and expense up to the amount allowed for the year that the equipment is installed. You may depreciate any excess on the depreciation schedule for that particular asset. Examples of this type of lease include $1.00 Buyout, and 10% Purchase Upon Termination (PUT) leases.
$1 Buyout or Lease to Own
This lease allows the lessee to own the equipment for $1 at the end of the lease. The following options are available at the end of the lease:
Purchase the equipment for $1
Upgrade the lease
10% Purchase Upon Termination (PUT)
Under this lease type, the lessee must purchase the equipment at the end of the lease term at 10% of the original equipment cost, so the following options are available at the end of the lease:
Purchase the equipment for 10% of the original cost
Upgrade or renew the lease
Tax Lease/ True Lease
This lease type allows the lessor to retain ownership at the end of the lease. Many rental contracts qualify as a true lease including a 10% Option and a Fair Market Value lease. Lease payments paid by the lessee are deductible for federal tax purposes. The following are tax leases:
10% Option
The 10% Option guarantees a 10% residual on the equipment and allows the lessee the option of purchasing the equipment for 10%. This lease offers the following end-of-lease options:
Purchase the equipment for 10% of the original cost
Return the equipment
Upgrade the equipment or renew the lease
Fair Market Value (FMV)
This is a good lease option for companies that upgrade to new equipment every few years. This lease provides the lowest monthly payment as well as three options at the end of the lease term:
Purchase the equipment for fair market value
Return the equipment
Upgrade the equipment or renew the lease
Please consult your accountant or tax advisor to evaluate the best tax solution for your company.
