"Equipment finance is one of several options available to businesses seeking start up or growth capital. It is a highly attractive finance option because it can provide exactly what a business needs in order to survive. This could include machinery, software, computers, or even office furniture. Businesses will also find that equipment financing tends to not tie up cash, receivables, or credit cards. Overall it can reduce the amount of cash a business will need, and the best part is that it can be written off at tax time.
One particular form of equipment finance is a general equipment loan. This option can be valuable because the majority of equipment that is acquired is not likely to become obsolete as fast. The technology and medical industries would have to worry about the equipment becoming outdated. In general an equipment loan is a wise choice because there is low obsolescence. Ownership and equity are other reasons why equipment loans are a good choice. You get the same benefits as if you owned the piece of equipment, and it also allows you to use equity to go after more working capital down the road if needed. The main benefit to an equipment loan is that a business can expense up to $25,000 worth of new equipment for the first year it is purchased. This adds up to decrease the final purchase cost. Any amount of equipment loaned over $25,000 would be depreciated over the next several years for an ongoing tax deduction.
Equipment leasing allows a business to get the most tax benefits possible while saving cash at the same time when compared to other forms of equipment finance which are available. The lease of course must be returned at the end, but often times the lessor will give a business the opportunity to buy the item for "Fair Market Value" at the end of the lease. That final total is often determined after the lease has already expired. The monthly rental payments can be tax deductible, but it is advised to speak with your accountant before taking out an equipment lease. With the lease you are simply paying a straight rental payment with no interest on the item. It can be difficult to locate equipment leasing companies, but researching the top search engine results from the phrase "funding directory" will return a valuable, free option for getting in touch with equipment leasing companies."
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Creative financing is how US businesses are going to survive in 2009. If you need a proposal, email me: apaladino@allmediacapital.com
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