Tax Implications of Leasing vs. Buying

for any small business owner Chris so the rule of thumb I'm gonna say is make sure that you get into your accountant months ahead of time at the latest weeks ahead of time and then you're gonna be scrambling because you're gonna if you're you know running an okay business you're gonna have money to spend and we've spent a lot of money over the last 10 20 years just to avoid tax bills and that's how we buy all new equipment every single year correct I mean and so there's leasing equipment there's buying equipment there's different loopholes and advantages and so let's talk about let's talk about some of that stuff okay you want to cross-check that over a little bit sure so if you leave some there there are some different rules and that's why you do need to work with somebody you're not gonna be able to do all the research and stay up on everything when you're building a business and working long hours it's you know it's just like I wouldn't try to build my own deck or anything you have to have people that do those things for you but uh the back to your question you know you know if you lease something and it's for a hundred percent business item which I'll assume everything we're talking about is items that are gonna be used 100 percent for the business so all of your lease payments would be deductible then would be a hundred percent correct right that equipment correct now you wouldn't own that equipment you give that back five year leaves or whatever the terms of your lease are so one of the different rules I would mention that some people get confused on and that's my you know important to have a professional if you have a lease with like a one dollar purchase at the end i RS considers that a purchase upfront then that's not a lease then you'd appreciate it because who doesn't take it for a buck at the end of the lease they consider that purchase them so you know there's all sorts of different rules and things like so that's an IRS red flag if you don't want it yeah because you want to treat it the right way so you don't deduct all the payments you depreciate it and then otherwise you know if it's a legitimate lease option we know a regular a fair market value buy at the end you deduct all your lease payments along the way and then you purchase it for you know X amount and then depreciate that item but when it's a bargain-basement price like a dollar then that's just considered a purchase off from okay and I want these guys I really want us to break this…