January 11th, 2012  Posted at   Leases Leasing
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When small businesses are first starting out, a huge chunk of their starting capital usually winds up sunk into the equipment they will need to get up and running. If they had looked into obtaining that same equipment through a capital lease, they would have been able to get everything, under much better conditions financially, and would have more money to further invest in their business. And, because of special tax considerations, that lease would have also netted them a significant tax break at the end of the year.

Capital Lease vs. Outright Purchasing

Small businesses have limited funding starting out, that is an unfortunate fact of the business world. If they were to go the route of purchasing all the equipment they need to begin operating, from manufacturing equipment to office equipment, it will mean cutting those startup funds in half, if not more. Granted they might be able to get some warranties on what they purchase, but after that all maintenance or replacement is now their sole responsibility. At the end of the year, at tax time, it becomes part of their overhead, subject to taxation and depreciation.

In a capital lease, however, they can arrange to lease that same equipment, with the intent to purchase. Instead of laying out all that cash at once, they make smaller payments, over time during the length of the lease, with the option to purchase it fully for a very minimal amount. This makes it much easier on their operating budget, and maintenance is taken care of by the leasing company. Depreciation is not applied at year’s end, because ownership is still shared between them and the leasing agent. However, it is still considered to be a purchase, and counts towards the tax benefits that all businesses receive yearly under Section 179 of the tax code.

The Benefits of Section 179

Designed to benefit small business rather than larger concerns, Section 179 of the tax code was created to grant small business owners incentives to invest more capital through purchases for the business. It basically offers tax deductions for the purchase of equipment up to a maximum of $500,000 per year, rather than lose money by having to deduct the depreciation over time since its purchase. However, recent changes have even altered the practice of depreciation, allowing up to 100% of what would have been lost to be taken as a deduction instead. Read more… »

January 10th, 2012  Posted at   Leases Leasing
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You take on many expenses when moving. Putting a deposit down on your new place, paying start-up fees for electricity and phone services and paying movers to transport your items are just some of the fees you encounter during the moving process. Getting your security deposit back from the apartment you are vacating can be one way to mitigate your many moving expenses. However, sometimes this deposit is used up in full, leaving you without a reimbursement. To ensure you get your apartment security deposit back, you should be familiar with the policies described in your lease and work to meet all the requirements for getting your deposit back. Be sure to give appropriate notice about leaving in writing because not giving the right amount of notice can sometimes cause deposits to be rightfully retained.

In order to get your apartment security deposit back, you must leave your apartment in the condition you rented it in as nearly as possible. Some normal wear and tear is to be expected, but notable damage and dirt are common reasons that many apartment renters to not get their deposits back. To ensure you do, you must make repairs to any damages that occurred during your stay and clean your apartment thoroughly. Looking at your copy of your move-in checklist, in which the condition of each part of your apartment at the time you moved in is recorded, can help you determine if there are specific areas you need to address.

Don’t forget to tidy up the places you don’t clean regularly, such as the oven and the laundry room vent. Attention to detail, such as replacing the trays beneath the stove top burners and replacing any light bulbs that burned out, can be critical to getting your refund in full. Rental companies and homeowners can subtract even minor cleaning services and repairs from your deposit.

The first step to getting your deposit back is discovering or refreshing your memory as to what your rental office or landlord expects. Reviewing your lease and your move-in inspection can help you learn about lease refund requirements. If you don’t have these documents on hand, ask for copies. Asking how you can get your deposit back in person can also help you understand the requirements. Read more… »

January 3rd, 2012  Posted at   Leases Leasing
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Before we discuss the benefits of leasing for your businesses, let us first find out what an equipment lease actually is. An equipment lease is a long-term rental agreement for any type of equipment. The equipment has to be maintained well and it is often required that the lease term does not exceed the total life of your equipment. Once the lease term is over, you have the option of returning the equipment to the company that provided the lease or purchasing the equipment. Equipment leasing allows you to get the equipment you need at manageable monthly payments, often times with no down payment required, so your company can thrive.

In recent times, equipment leasing has become on of the most viable options for acquiring equipment for any businesses. Whether it is an established firm or a new business, everyone prefers to lease some or all of their business equipment. Business owners often find that they need to add new equipment and often choose the leasing option. Following are the ways equipment leasing benefits your business:

1. Leasing calls for a monthly payment lower than the periodic payments required when purchasing new equipment.
2. Down payments are often not required and the cash can be saved for your business expenses.
3. There is a fixed payment plan during the term of the lease unlike the variable interest rates of bank credit lines.
4. Lease payments are considered pre-tax expenses that reduce tax liability.

What has turned most business owners toward leasing is the fact that equipment leasing frees up the capital that can be used for business expenses required to complete larger projects. For new businesses it is increasingly difficult to get a bank loan when there is no credit history to support their loan application.

Equipment leasing also gives you the option of paying in installments for your new equipment. There are many equipment financing companies that offers flexible terms of repayment. These companies will suggest customized financial solutions from which you will choose the appropriate equipment lease option. Read more… »

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