Leasing Equipment: Tax Benefits and Lease-to-Own Options

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How to buy, rent or lease equipment the RIGHT WAY!

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What happens here

The presenter elaborates on leasing, explaining that it shares many tax benefits with renting, notably that 100% of lease payments can be tax-deductible (potentially a 33-50% savings depending on the state). However, leasing requires commitment to the product for the lease term (e.g., six months to a year) and responsibility for returning the equipment in good condition to avoid penalties. He differentiates between leasing a truck (which often has strict mileage limits) and leasing heavy equipment. He introduces the 'lease to own' option, a long-term lease with a buy-out at the end, making all payments tax-deductible while ultimately owning the equipment. He advises negotiating lease terms carefully, especially if an ownership goal exists.

Goal: Understand the tax advantages, responsibilities, and options like lease-to-own for equipment.

Tools and materials

ASV — Example of heavy equipment that can be leased
Diamond C Trailer Diamond C — Example of a trailer that can be leased
Ford F-250 Super Duty Truck Ford — Example of a vehicle that can be leased

What they say

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nothing all right all right we haven't covered leasing yet now think of leasing about the same as renting for tax benefits meaning that 100% of everything that you pay to rent a piece of equipment or lease a piece of equipment is 100% tax deductible that's a 33% savings unless you're in California then it's closer to like a 50% savings but there are some stipulations for one you got to know that you're going to be committed to this product whether that's 6 months or a year number two there's some responsibility that goes along with with leasing as well with rental I'm not saying run it like you rent it meaning beat the heck out of a piece of equipment there is a certain level of responsibility you want to return the equipment in the absolute best physical condition that you possibly can or you're going to get danged there is a difference between leasing a truck and leasing a piece of equipment now I've had an ASV like the one you see back here on lease for the last 3 years but I am also responsible to make sure that that piece of equipment doesn't get destroyed doesn't get bead up doesn't get used and abuse I've got to return that thing back the way I got it but here's the beauty part of it every time my lease is up I have the option to renegotiate that lease and get a different piece of equipment so if I want the latest greatest toy leasing is the way to go if I don't want to deal with the maintenance the headaches the hassles of repairing and running old junky equipment leasing is the way to go but if you want the benefits of owning a piece of equipment you want to have something that you can claim as your own there is something called the leaste to own option and this is beautiful this is absolutely beautiful and what that is is that is a long-term lease with a buyout at the end meaning you own it but every single payment you make is 100% tax deductible I cannot stress dress to you enough the advantages of having all of your payments tax deductible it's a humongous savings at the end of the year some companies very few very far between will lease with a $1 buyout at the end negotiate your lease accordingly if you know you want to own that piece of equipment negotiate it accordingly if you don't care about owning that piece of equipment well then you're going to have some more freedom more flexibility there's actually truck leases out there that automatically require you to turn the truck in as soon as you hit 12,000 mil they use your lease to to…

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