"Do the math and determine whether the Section 179 deduction and bonus depreciation will benefit your business or not," said Mike Lockwood, president of TEQlease Capital.
Calabasas, California (PRWEB) November 29, 2011
With just five weeks left of 2011, many businesses are determining whether to acquire new equipment now or to wait until 2012. Mike Lockwood, president of TEQlease Capital, a nationwide provider of equipment lease financing solutions, recommends that businesses carefully research equipment financing needs and determine an equipment lease financing strategy before finalizing any end of year equipment acquisitions.
Lockwood cautions that businesses should consider the following eight tips to ensure they don’t make any costly year-end financial mistakes on their equipment purchases:
1. Do the math and determine whether the Section 179 deduction and bonus depreciation will benefit your business or not. Section 179 depreciation deductions and bonus depreciation are scheduled to be scaled back after this year. Meet with your tax advisor now and determine whether deferring a purchase may have an adverse tax impact.
2. Don’t make an equipment acquisition decision based entirely on the availability of tax incentives.
3. Understand your credit and organize your financial information before contacting an equipment financing provider. Lease financing appears readily available for equipment acquisitions for the upper tier of creditworthy borrowers, and loan demand for these borrowers is strong. However, expect the equipment financing provider to require more financial information than in previous years. Explain in advance any negative results.
4. Describe to the equipment financing provider what this equipment acquisition will do for your business. Provide a projection of cost savings or incremental realizable margins.
5. Don’t assume your bank or the equipment manufacturer’s captive finance company will offer the best terms. Compare rates, lease terms, fees and options.
6. Consider bundling multiple equipment acquisitions from different vendors under one lease with an independent commercial equipment lessor. Rates tend to be higher for smaller transactions. Bundling generally results in lower rates, and also minimizes processing fees.
7. Don’t pay upfront “application” fees to an equipment financing provider. Do due diligence on your financing provider. Use only established providers.
8. Ask your equipment vendor for payment terms so you can defer a portion of the equipment cost, and coordinate deposits, progress payments, and performance retention payments.
TEQlease Capital is a nationwide provider of equipment lease financing solutions across all industries, including manufacturing, education, distribution, financial services, healthcare, and retail organizations. TEQlease Capital customers include Fortune 500, medium-sized, and small businesses. Founded in 2000, the company is based in Calabasas, California. For more information visit http://teqlease.com/, call 1-818-222-1006, or email sales(at)teqlease(dot)com.
TEQlease Capital and TEQlease are trademarks, registered trademarks,
or service marks of TEQlease, Inc. All other trademarks are the property of their registered owners.