Ahead of the Competition!
Leasing enables your small business to acquire more sophisticated technology such as a VoIP, which you may otherwise be unable to afford. You receive the same advantage as your larger competitors without having to drain your finances to keep their pace. In the office technology industry, computers and copiers often become obsolete, but with a lease, you bypass the financial burden, and you can update without making a financial commitment. For example, you have a three-year lease for a copy machine, but when that lease ends, you can lease newer, faster and more advanced equipment.
Leasing: Understanding the Negatives
While leasing has its share of benefits, you will ultimately pay more in the long term. A $4,000 computer costs $5,760 when leased for three years at $160 a month. In addition, the contract will force you to continue paying even if you no longer need the equipment. Before ending a lease, be certain you contact the lease company well in advance to avoid automatic renewal of your lease.
However, while it has a couple negatives, a lease becomes a tax deduction under Section 179 of the IRS code, and it guarantees you keep the latest equipment at your business. Computer technology becomes outdated quickly, and a lease gives business owners a method of keeping the latest equipment.