About Equipment Financing
Equipment financing helps businesses acquire necessary equipment through loans or leases. Understanding the differences between these options can help you make the best financial decision for your business.
Financing Options
Equipment Loans
- Full equipment ownership
- Tax benefits from depreciation
- Build equity in the equipment
- Longer repayment terms available
- Higher upfront costs
Equipment Leases
- Lower upfront costs
- Fixed monthly payments
- Easier equipment upgrades
- Maintenance may be included
- No ownership (unless buyout)
Key Considerations
Financial Impact
Consider total cost of ownership, including maintenance, tax implications, and potential resale value when comparing options.
Business Needs
Evaluate equipment lifespan, technological obsolescence, and your long-term business requirements.
Tax Implications
Loan Tax Benefits
Deduct interest payments and depreciation, potentially reducing your tax liability over time.
Lease Tax Benefits
Lease payments may be fully deductible as business expenses, simplifying tax calculations.