Technical Equipment: Why More Businesses Are Leasing
When the topic of equipment leasing is discussed, large pieces such as construction vehicles, manufacturing machines, and industrial appliances usually come to mind. However, as businesses across all industries are realizing the necessities of having fully-integrated IT, technical equipment is coming to the forefront.
The Argument For Leasing Technical Equipment
Technical equipment covers a wide range of items. Servers, data backup and storage, telephone systems, workstations, network switches, and more fall under the heading, along with items most businesses frequently overlook, such as desks, copiers, and fax machines. The pace of technological advancements is extremely fast, and businesses running on technical equipment that is three to five years old start to lose an edge over other competitors in the same industry. By leasing technical equipment, businesses have the option to trade up to the newest models as they become available. Compare this with businesses that purchase technical equipment, which depreciates at a very rapid rate. Purchasing such equipment means having to offload it at a very reduced cost, only to recoup a fraction of the amount needed to acquire newer versions. Financially speaking, purchasing computers for your business is extremely cost ineffective.
Leasing Versus Loans
Purchasing IT equipment comes with a very large initial cash outlay. Businesses often end up taking out loans to make up the difference, which translates to assuming additional debt. With faster development cycles in technical fields, repeating this process every three years or so can severely impact credit ratings, and force businesses to juggle multiple loans before the initial one is repaid in full. Leasing equipment, on the other hand, is not a loan. Instead of paying upfront, the overall cost if spread out over manageable monthly installments. Businesses preserve their credit ratings, and reduce the impact on finances.
As it stands, leasing technical equipment translates to big tax benefits. Itemized deductibles on computers and other technical equipment owned by a business are lower every year, due to depreciation. By leasing equipment, businesses can deduct the payments made to the leasing company, without having to figure out depreciation. Businesses can currently claim leasing deductibles up to $500,000 according to the IRS.
Get The Technical Equipment You Need
At BG Capital Funding Group, we offer the most comprehensive equipment leasing program. Whether your business needs vehicles, manufacturing machinery, medical equipment, servers, copiers, workstations, or anything in between, we’ve got you covered. Contact our offices today to get started.